We're Trapped In An Interest-Only

Shauna wanted to get her home mortgage refinanced but her credit is miserable and she's having a hard time.

QUESTION: Shauna can’t get a refinance of her interest-only adjustable rate mortgage. They owe more on the house than it’s worth and can’t sell it, but want to do a short-sale. How do they negotiate that, and would they have to sell by owner?

ANSWER: You can use a real estate agent for that. They won’t get paid a full commission, but they’ll work with you. You need to get the companies that turned you down for a loan to write you a letter saying you’ve been turned down. Then gather statistics in your area as to how long it’s taking houses to sell and what one like yours is selling for. Then when you get a real estate agent who brings you an offer, you put out these statistics that show the market stinks in your area. That gives the mortgage company a reason to be willing to accept less.