Upside Down Mortgage, Short Sale and Loan Modification
An upside down mortgage is simply a mortgage that has a balance that is greater than what the actual current value of the home. This is also referred to as a mortgage with negative equity.
More often than not a person with an upside down mortgage will face some serious challenges if a need arises.
It’s common for homeowners who are upside down to consider selling their home in a short sale. In a short sale a homeowner will work with their current lender to agree upon a value to sell the home and the balance of the mortgage which is always higher in a short sale, is written off by the bank. There are some very common pitfalls to this situation so it’s best to consult a professional.
Others facing this situation will seek out an upside down mortgage refinance. There are several option these days so it’s best to talk to your current lender or approach a local broker or bank for refinancing options.
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