Hooray, I’m $38,000 Upside Down In My Home Mortgage

upside down home loanLike many states, Michigan took a huge hit in the housing market and the mortgage industry. As of December 2010, according to my local township, I’m $38 thousand dollars upside down in my home loan. In other words, I owe that much more for the loan than the home is worth.

What To Do With Your Home Mortgage

What should I do? Nothing! Did you notice the ‘hooray’ in the blog title? I have no plans to sell or refinance the house so what’s the big deal? The big deal is that my taxes went down two times in a row over the last two years. The house still has the ‘living value’ as it always did to me.

We keep hearing about short sales and people just walking away from their homes because they’re so far in the red. Why? If the home was worth (fill in the blank) $___ each month ‘to you’ before the home value crashed, and you plan on staying there for a long while, what does it really matter?

But I’m In The Red With My Home Loan

Psychologically we tend to think, “I can buy a house twice as big for the same money”. Admittedly your net worth is taking a hit but, again, if you’re not seeking a loan what does it matter? If you simply can no longer afford the house for whatever reason, that’s one thing but we are still obligated to pay the debt even though the home decreased in value. There are no guarantees when it comes to investments and that’s what buying a home is. We’ve just been pretty spoiled with home values for years and reality is sometimes a hard pill to swallow.

The Future Housing Market?

As far as I’m concerned, I hope my home value, and taxes, continue to drop. Let the government squirm and struggle for a change. I’ll find somewhere more deserving to put that money.

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