With all of our years being homebuyers in Texas, we’ve encountered many reasons why people find alternative real estate solutions, including not being able to afford their house.
There are reasons why this can happen, and it is nothing to be embarrassed about. Maybe it’s time to downsize and you don’t have enough equity, or maybe you’ve had health problems that prevent you from working for a prolonged period of time and some of your savings were depleted.
Whatever the reason, you might be going through financial hardship and realizing that you can’t afford your monthly mortgage payments anymore or perhaps, you’re already behind. The good news is that there are options and solutions for your situation.
5 Options if you can’t afford your house payments
Refinancing your loan means that you would take on another loan to replace the current one that you have. This is an action that you would have to take immediately after realizing that you won’t be able to afford your monthly mortgage payments. The longer you wait, the harder it will be to get approved for refinancing.
Refinancing has several potential outcomes that may include:
Getting a forbearance agreement means getting a temporary reduction or suspension of your mortgage payments. This only applies if you know your economic hardship will be temporary, though. If this is the option that best fits your situation, it means that you’ll eventually have to pay the mortgage payments that you skipped or the total amount that you got reduced on top of your regular payments. You might be eligible for forbearance if:
Renting your home is always a good option if you have some other place to move to. Perhaps you have a relative that can take you in or you can find a cheaper place to live in, such as an inexpensive apartment. If this is the case, then this would be a good option. The extra income that would come from renting your house out should be able to help you keep up with mortgage payments and maybe allow you to save some of it! And if you are not profiting from the rental income, at least the tenant is paying your mortgage expenses while you are saving money, living in a more affordable residence.
If you decide to short sale your home, you would sell your home for less than the amount that you owe on your mortgage. This will affect your credit report, but in most cases, it looks better on your credit than a foreclosure (this is different for everyone, however). Short sales can also take a long time to close, so if you are in a hurry, this is not the best option.
Many people who can’t afford their house anymore choose to call a home buyer. If you are looking to sell your home fast in order to avoid foreclosure or short sale, you can sell your home to a wholesaler such as We Teach Houses. This means that you could sell your home in a short period of time! We pay cash for your house, regardless of its condition and can often work with your lender to help stop or postpone foreclosure long enough to close on your home.
If you are falling behind on payments and can’t afford house payments anymore, you have plenty of options! The longer you wait, the more limited your options can become!