Mortgage Lemons to Mortgage Lemonade We have met with many people over the past few years that are “under water” on their homes, or are behind in their mortgage and need to short sell. We always get the short sales done, but they can be very problematic and stressful for everyone involved. You definitely have to think outside the box when your client has a short sale to sell.
Recently, we met with a young couple who live locally. They came in talk with us about their home and helping them to develop a plan on either getting them out of their home or keeping them in their home. They had already approached their bank and had a forbearance agreement in place. Basically, the bank allowed them to take the winter mortgage payments and put off paying them until April 1st. April 1st was quickly coming and those mortgage payments were coming due. These folks were getting nervous. They felt that they would be able to pay all the mortgage payments to their bank on time, but then what? They have no equity in their home, and the payment is kind of steep for them – especially now that they have children.
We counseled with these folks for several hours. We talked to them about possibly short selling their home or in the worse case, letting the bank foreclose on their home. We talked about how each alternative affects their credit and that they’d need a place to live once they were done with this home. We all developed a plan and they were on board … albeit, not happily on board.
As they were getting ready to leave, we had one more suggestion for them – give a call to a mortgage banker that we know and see if they could refinance the house. We all felt it was a long shot – at best.
A week or so later, we called to follow up and see how things were going. They were thrilled! The mortgage banker said that they could refinance! They had a Fannie Mae loan and it could be refinanced without an appraisal. They were going to save over $350 per month on their mortgage payment and be able to stay in their home.
It’s not often, but sometimes, mortgage lemons can be turned into mortgage lemonade!
Bob & Richelle Ward, Realtors, ABR
Prudential Connecticut Realty
Cell - (203) 470-9818