While this may not be your favorite subject, it’s something to consider when debt is something you have to worry about.
If you have ever thought about selling your home in Central Florida to pay off your debt, let’s talk about what that looks like in actuality. While our initial answer to selling your home to pay off debt would probably be no, there are a few instances when it’s something you could consider.
Should I sell my home to pay off my debt?
Here are three reasons you might consider selling your home to pay off your debt:
Your house is too expensive.
When you buy a house you can’t afford, debt is going to add up quickly. Sending half of your monthly income to the bank to make your house payment means you have way too much house, and that is something that will cause you added stress in the long run. Overextending yourself is not a wise decision to make and something you should get yourself out of if that is the case.
Your house is too big.
A house can be too big without being too expensive (like mentioned above). Although you may be well within what you can afford, your current house may offer more space than what you really need. Bigger houses mean more furniture, more heating or cooling costs, more repairs, and so on. This translates to more expenses all around. If you’re looking to downsize, you will save money in more ways than one, allowing you to put more money towards your current debt.
You really don’t like your house or your neighborhood (or some other similar reason).
Maybe you’ve never really loved the layout of your home, or your neighborhood is just not what it used to be. While these are things that may have made you consider the idea of selling your home in the past, they usually aren’t deal breakers when it comes to actually biting the bullet and putting your home up for sale. Factor in your debt, though, and it may be time to look for a new (more affordable) home that will help reduce the debt you have incurred.
While these may be reasons you’re considering a sale of your home, your house is probably not the actual problem when it comes to debt. Credit cards, car payments, and student loans often make up the bulk of your debt. Selling your car with the attached $600 car payment may be a better option to consider than selling the house you and your family call “home.” Remember, cars depreciate quickly and really aren’t an “investment,” but, historically, homes are an appreciating asset and greatly contribute to your net worth and overall retirement plans.
In the end, whatever your goal or concern may be, it is important you receive sound advice, know all the facts, and make an informed decision. We know the real estate market is performing well now, but understanding what rising home prices and low interest rates mean to you is vital to helping you make the best financial decision. The good news is you’re not alone – Dream Builders Realty is known for our expertise, and we always stand ready to listen, understand, and guide you.