Friday, September 20, 2013

Renting Your Home Might Be Best Option

Homeowners have a few options open to them if they are underwater. That means homeowners have a higher mortgage on their home than the appraised value. Two options combined may be your best solution.

Recently, 2.5 million Americans returned to a profitable status leaving only 4.5 million that remain underwater on their home, according to CoreLogic September 2013. Great news unless you are still underwater. The DU Refi-Plus for Fannie Mae-backed loans and the Freddie Mac open access programs are the programs available from lenders like me to lower the mortgage rate even if you owe more than the appraisal value of the property. Even if you have been told you don’t qualify, recent changes to the program may have changed your status.

Homeowners who are underwater but have to move for some reason might be unsure of what they can do. For example, homeowners might have to find a bigger space or have a new job in another location. Homeowners in this situation might believe that the only option to them is to put the home up for a short sale. The problem is that after the short sale the homeowner will need to wait one to four years before they can qualify to purchase a home.

It may be possible to find a reputable tenant and rent the home. This option may lower or even eliminate the debt of the current mortgage payment. The money acquired in rent will change the debt-to-income ratio, probably allowing a new purchase. As a loan officer, I can work with real estate agents or property management companies to assure everything is done to recognized underwriting standards.

The new lower mortgage payment combined with the income of the tenant will make it easier to purchase a new home. While this idea is not new, the way I approach the problem is uncommon. I believe in helping my customers as much as possible. I want to help them move on with their life and possibly create a source of income for them.

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