Before You Fire-Sale Your Arizona Home: Make Sure You Know Where You’ll Live Next

Selling a Arizona home quickly can solve mortgage arrears but create a new housing problem. Understand rent, credit and equity before you fire-sale.

Solving the mortgage problem is only half of the decision

When foreclosure pressure is building, a quick sale can feel like instant relief. But the day after closing, you still need somewhere to live. That question should be answered before you sign away a home containing substantial equity.

Renting usually requires more than the first month’s payment

A move can involve a security deposit, application or screening costs, utility deposits, movers, storage and other expenses. Even when a sale produces cash, those costs reduce what remains of the equity.

Price your next housing before you sell

Before accepting a distressed-sale price, check current rents in the Arizona area where you would actually live. Add the likely security deposit, moving costs, utility deposits and other transition expenses so you understand the real cost of the move.

Your credit may be weakest when you need it most

Several missed mortgage payments may affect credit at the same time you are applying for a rental. Landlords commonly use tenant screening and credit information, and negative information can lead to denial, a cosigner requirement or a larger deposit.

Do not trade $200,000 of equity for a $20,000 emergency without comparing the alternatives

If the house contains substantial equity and the arrears are a much smaller number, selling the whole property is a major response to a smaller immediate shortage. Sometimes it is necessary. Sometimes it is not.

A low cash offer can compound the problem

If an investor offer is below realistic market value, you may give up equity at the same time you are taking on moving expenses and higher housing costs. Understand the net proceeds, not just the headline cash price.

Sometimes selling really is the right answer

If the mortgage is permanently unaffordable, you want to relocate, the property no longer fits your needs or there is not enough time or equity for another solution, a sale can be sensible. The point is to choose it with the full housing picture in view.

Do not solve a mortgage emergency by accidentally creating a housing emergency

Before accepting a fire-sale price, determine the cure amount, property value, total liens, available equity, expected sale proceeds and where you will live next. If you have approximately $100,000 or more in available equity and want to keep the home, submit the property for review before assuming a sale is your only path.

Request a private property review

If you want to keep your Arizona home and have substantial equity, send us the approximate property value, mortgage balances, amount you are behind and any foreclosure sale date. Situations with approximately $100,000 or more in available equity are generally the best fit for the type of assistance we provide.