OfflineI was recently asked a question about what I thought of properties where the mortgage is higher than the value of the property and the payment on the mortgage is too high to rent.
Really, this does not matter much to me. When I see situations like this I immediately think about short sale. Houses that do not have equity and have too high of payment need to be short sold to make any sense for us to purchase them. If the seller of the property or the bank that will need to accept the short sale do not comply there really is not much for us to do and make the incomes that we are hoping for.
If you are not familiar with short sales if is basically when the bank accepts less than what they are due. For instance if the home is worth $100,000 and the bank is suppose to receive $130,000 but the bank accepts an offer for $70,000 the bank will sell short of their $130,000 payoff mark.
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Thank you for answering my post. I don't usually get my questions answered. That was exactly my situation above. Mortgage too high and monthly payments was too high for rentals. But the sellers didn't want to do a short sale bc they didn't have any problem paying for the place and they wanted to get a loan for another house they like. They just wanted to move. I end up not being able to help so I moved on.
Thanks again. I love this site!!