Your Houston home is damaged. You’re facing foreclosure. These are the realities and now you must come to terms with what to do next.
Selling any home is a major decision. Selling a flood-damaged home in order to avoid foreclosure adds new dimensions to an already challenging process. No homeowner expects to see the wind and rain turn their real estate investment to ruins. It’s time to weigh your options and make decisions. Here’s what you need to consider…
If you’re unwilling to settle for anything less than a certain amount from the home sale, you have a long, uphill battle ahead of you. The fact that you bought your Houston home for thousands more than homes selling in your neighborhood doesn’t matter anymore.
Many factors affect the value of your flood-damaged Houston home. Appraisal values are closely linked to how well your neighbors’ homes weathered the storms. You might consider yourself lucky if your home is the last one still standing in an otherwise devastated cul-de-sac. Unfortunately, its value is likely to plummet because of those circumstances.
Getting the highest valuation for a water damaged house requires a thorough inspection. A professional estimate is non-negotiable and will be advantageous if you decide to sell the home in the traditional market.
Foreclosure is a long and difficult process that can haunt you financially for years to come. Your lender can start the process if you’ve been consecutively delinquent on your mortgage payments. You may sell your home to pay off what you owe, which can be 80% or less of last year’s market value. That’s all to say your home is habitable. A severely distressed or flood-damaged property is going widen the gap between what it’s worth and what you need to break even with your mortgage lender.
Inaction is common. You’re scared. You’re trying to put your life back together and you have a thousand other concerns on top of dealing with your living situation. Nobody wants that seven-year black stain on their credit report. No matter what, taking control of your situation is the only way you’re going to avoid foreclosure and its crippling long-term consequences.
Transparency and communication are key. Let your lender know your situation and ask for advice or suggestions. Ask if a public foreclosure has been scheduled and how much time you have to stop the sale.
Whatever equity you may still have in your flood-damaged home means having more options. You might qualify for a home equity loan to pay for repairs. On the other hand, if your flood-damaged home is worth less than what you owe, your home is underwater. An economically sound (and emotionally soundproof) choice may be to give up the home and move on.
There are several ways to cut your losses and minimize financial and emotional burdens on you and your family.
Initiate a short sale…
Similar to a traditional sale, a short sale usually requires working with a real estate agent to sell the home. The difference is, you’ll need to involve the mortgage lender when it comes to setting a price, negotiating offers and agreeing to the final sale. Just because your home is damaged doesn’t mean it won’t appeal to traditional buyers. If the price is right, you’ll generate interest among buyers and have enough to settle the score with your lender.
Deed in lieu of foreclosure…
This should be a last-ditch option. It means transferring ownership of your home in exchange for the cancellation of your loan. You’ll avoid the time, money and stress involved in the process of enforcing the mortgage or other attempts to rescue the home from being taken away. Pretty much though, it means walking away with nothing to show for the property. Homeowners with no equity may end up choosing this option if only to avoid foreclosure.
Sell to a Houston cash buyer…
If time is running out, selling to a professional home buyer in your area is always an option. They can make a cash offer on your flood-damaged property and close quickly, sometimes in a matter of days. Selling to a cash buyer is a clear-cut choice if you’re unwilling to get the home inspected and fork over money for repairs. You’ll also sidestep having to pay agent fees and commissions.
Move on with confidence
Life is unpredictable and unfortunate situations can seem hopeless but you will get through it! A flood-damaged home isn’t a total loss when you consider the assets that may have been spared: your car, precious jewelry or your life-insurance policy, for example. These valuables can be liquidated to cash to contribute to the cash needed to avoid foreclosure.
Tough times may mean recruiting family members to help. Especially if you’re doing all you can to sell the home in the meantime. Can someone take an extra job to bring in some extra income? Do you have relatives that can give you a loan? Offer to sign an agreement ensuring your commitment to paying them back at a reasonable date.
Seek help, take action and don’t wait until it’s too late!
We help homeowners like you. Whether you’re facing foreclosure, need to sell a flood-damaged home, or both, we can help! Get in touch with us to discuss your options about a cash offer on your Houston home. We close fast on homes in any condition!