Housing Down 17% in December 2009, Largest Monthly Drop in 40 Years
What Happens When the Bank Threatens Foreclosure While Your House Is On the Market?
What was once the housing bubble has long since popped. Unfortunately, it continues to leave a viscous film for homeowners.The month of December was a startling example, as it was the sharpest monthly decline in home sales in 40 years. Albeit, winter is a down-season for home-buying. Still, Congress had hoped that pinning an extra 9 months on the $8,000 tax credit offer for first-time homebuyers (expires August 30th 2010) would improve the number.
Such a record-breaking swift decline is alarming, but the numbers aren’t hopeless. In its most swollen state, during the era of short-lived “bubble” prosperity, sales were 25% higher than present. Right after the bubble’s alarming deflation a year ago, sales were 20% lower than where they are now—a huge improvement over a single year.
Those who’ve lost their jobs and begin to miss mortgage payments are immediately threatened, as just a few missed mortgage payments can commence foreclosure proceedings in this down economy. One of the only ways to combat foreclosure is to sell one’s home, or file for bankruptcy. Still, if your ultimate goal is to sell your home and move, you might wonder whether filling for bankruptcy when you’re still hosting Open Houses—in a market with stagnant sales chances—is your best option.
Bankruptcy Now or Bankruptcy Later?
The government is stepping forward and attempting to make up for your undersold home by providing a $6,500 tax credit for families that move to a new residence. In a perfectly ideal scenario, you and your family could use that tax credit to make a down payment on a home with more affordable monthly mortgage bills—solid ground until the old house sells. Still, if your credit is good it’s wise to seek out a home loan for your new, more affordable home before you file for bankruptcy. You will need the bankruptcy to keep your more expensive home from foreclosing, but bankruptcy can significantly deter you from gaining a desirable loan rate for a future property.
Filing for bankruptcy to avoid foreclosure is not your only immediate choice. If you’ve maintained a decent credit score, you could potentially refinance the terms of your current home mortgage for a lower, more manageable monthly payment.
If you find that bankruptcy is your best option, it’s vital to adjust your mortgage or get a mortgage on a new home before your credit is affected by the bankruptcy. In cramped times, unemployed first-time homebuyers with zero equity are hurting the most—they don’t have the option of a second mortgage. You can avoid their plight. Plot your bankruptcy strategically around home buying, call a bankruptcy expert today at 1-800-260-1402.
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