With the current decrease in Myrtle Beach Real Estate property values, many clients that we have recently met with are left speechless when we share with them a comparitive market analysis on their property. The reason for their shock is that only two years ago they re-financed their property to get a lower interest rate.
During the process of refinancing, they also were given an option to do a cash out refi and collect several thousands of dollars for all sorts of things. Some used the money to pay off other bills,do renovations on their home, or take a wonderful Caribbean Cruise, finally purchase that fantastic 50" plasma TV, or the shiny new red convertible sportscar. Ah yes, those were the good times. Nobody worried about the higher loan on their house because property values were rising and the market was strong. So we didn't care if we had a higher mortgage payment, if an emergency came, we could quickly sell our home, and still have some money left over.
Then, the market took a swift swing from this strong sellers market to a strong buyers market. And, all of the additional equity that we had left on our homes dissapeared instantly.
Here we are now, in 2008 and that job transfer has come in, or the family has added another little one and you need to sell the current property. The problem is that home values have decreased and you are what we would call "upside down" in your property. That means the value of your property is less than the amount owed. Or, maybe you are lucky to break even. Either way, when you are given the current value of your property, please remember that you are not losing thousands on your property. What has actually happened is that you have already spent the equity in your home to do other things. There is nothing bad about that. It is your money to do with what you please.
When you begin to become upset about how you have "lost" so much and can't sell your home now, remember the wonderful trip you took to the Bahamas...Maybe sit back and watch your home videos of the trip on your big screen tv! Also, remember you originally purchased your property for much less than it is still worth now.
Jeremy Blanton- Myrtle Beach Real Estate Expert
Jeremy Blanton Myrtle Beach Real Estate
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Jeremy I understand I have seen too many homes that are being foreclosed on and a common theme when digging into the background for my buyers is that the sellers had either just refinaced the year before or had maxed out their equity by taking out a 2nd mortgage on the property the year before.