How can I sell my home when I owe more than the home is worth?
We don't all get to time the market! Sometimes you have to sell when it's not exactly profitable to do so. This is often the case when you bought a home during the peak of a market cycle and need to sell soon after, or when the market has turned downward. This is very common in Florida currently as the market has shifted downwards. If you need to relocate and lack the equity to sell, you have a few options:
Pay the Difference
This may be possible if you have some additional cash and wish to have the cleanest break. To figure out exactly what the shortfall would be, you will want to talk to a local experienced Realtor to get an idea of what the home would sell for and to also estimate the cost of sale (commissions, title fees, legal, taxes, prorations etc. Make sure you have an accurate assessment of what the amount will truly be.
Rent the Home
Renting is always an option, but you should carefully consider whether it makes sense for you. Who will maintain the property and make repairs? What will the expenses be? Are you ready to be a landlord? And most importantly - will you make a profit. Market cycles can take 10-20 years at times. You may end up holding the property longer than expected, so weigh the pros and cons carefully.
Consider a Short Sale
Lenders understand that sometimes a homes value may be less than it's market value and have a solution for owners who lack the funds to make up the difference. This is called a short sale. A short sale is documentation and negotiation process performed by a qualified short sale real estate professional. If approved for a short sale, the lender agrees to settle the loan for less than is owed so that everyone can avoid foreclosure.
Let the Home Foreclose
You may be tempted to simply walk away from the home, or "give the house back to the bank" Unfortunately giving it back is not a real option, and walking away leads to foreclosure. The Florida foreclosure process can take years to complete, and even when the foreclosure is complete, you may face additional problems. Florida is a deficiency judgment state, giving the lender the legal option to pursue you for their losses after the foreclosure.
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Minna has been a fantastic partner in selling our home. She was patient with us in explaining the differences between a short sale and conventional sale and helped us think through the pros and cons of each. During the process of the sale she was strategic and got us the best price for our sale. The process was painless and quick and every step of the way she managed each and every detail flawlessly.
D.L.
Last Updated on September 17, 2025 by Minna Reid