Tips & Advice
Could you owe more than your home is worth?
When people owe more than their home is worth, some say they are “upside down” or “underwater.” Banks and real estate professionals might use more formal terms like “negative equity,” but everyone’s describing the same problem.
But very few discuss the problem of being right on the edge, even if your house is worth slightly more than you owe. In this case, you’re not truly underwater or upside down, but you might still run into problems if you decide to sell.
In general property values increase over time and many homeowners see their equity grow as two things happen: they pay down their mortgage and the house appreciates. But, this isn’t always the case. In some cases, your house debt can grow or your property can decrease in value. If properties fall into disrepair, additional debt (or liens) can stack up on a property, eating up equity.
If you’re really close to a break-even point - owing close to your home’s value - you might not have enough equity to go through a traditional sale. It’s possible to have equity and not have enough room to sell. In this situation, you have a few options:
Don’t let uncertainty make you anxious or keep you from taking action. You may still have options, even if you think you might be upside down or you’re not sure if you have enough equity to sell.
The decision to sell your home isn’t always simple. You can read more in posts like these.
If you still have questions or want to talk through options with a real person, we have folks ready to help. Forget the robots and message apps, it’s as easy as picking up the phone.
