What should you do, when your mortgage is under water, in this video today, i’ll discuss a few option with you.

A shout out today to our best friend the Journeyman Investor!

Link to TheJourneymanInvestor Channel: https://www.youtube.com/channel/UCWLO…

00:00 Rising house prices
Lets go a few years back. Back to 2008. Back than banks were very willing to lend you money, for almost anything. Here in the Netherlands, you could take a mortgage and on top of your mortgage you could borrow like 50k extra if you wanted to. Nobody would ask you any question, even if you didn’t have a job. Until the housing bubble popped. And that lasted about 5 years. And if I look at it, we going down the same path again.

03:01 The concept of your mortgage being underwater
The definition of an mortgage being underwater is not really being underwater of course. It’s When you bought your home at the peak of the housing market, and after that, the housing prices dropped, causing your home to be valued lower than the amount of money you loaned from the bank.

05:06 Second point: what to do when your mortgage is underwater?
You have 3 options that you can do:

05:07 Option 1: stay in your home, and grow the equity of your home.
Renovate your home! Build an modern kitchen, bathroom or floor heating instead of standard radiators. You could also expend you living room or kitchen so you have more cubic meters in your home to sell.

06:16 Option 2: you just hate the fact you have an underwater mortgage
Pay off the excessive mortgage by paying off extra wherever you can.

08:45 Option 3: When you want to sell off your home:
You have 3 choices you could make on have to get rid of the mortgage:

09:05 Choice 1: you will have an extra debt that you still need to pay off.

10:08 Choice 2: use your savings money to pay off the residual mortgage straight off, so you’ll be debt-less.

10:25 Choice 3: you will buy a new home, and finance this ‘amount’ of debt into the new mortgage of your home.

11:05 Bonus option: Talk to a real estate agent
Sometimes waiting a few years, and then having a real estate agent, who you trust. appraise your home again. And in most cases, the prices will grow over time. My advice is: if you don’t have to leave the current home, don’t. Never choose the shortest way out, most likely, there is a better way out for you.

16:00 Help me grow
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