Should I Sell my House to Get Out of Debt?

Posted on August 26, 2017 | Back to blog

Dallas Real Estate

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Getting out of debt is one the best ways to avoid future financial issues while establishing more security for you and your family. Recent economic challenges have caused Texas homeowners to consider selling their houses to pay off debts.

Although the economy has slowly recovered from the devastating 2008 housing crisis, low wages and a weak job market continue to put Dallas homeowners at risk of higher levels of debt. Some Dallas residents seek out new loans as a way to obtain financial assistance to meet their debt obligations. But today’s lenders are cautious when approving these loans.

Debt-Relief for Dallas Homeowners

For most Dallas homeowners, their mortgage may be the largest form of debt they have. As a result, when looking to reduce their monthly expenses, they may consider getting out of their mortgages as a first option. Your monthly mortgage payment may leave you with just enough to get by. But in order to eliminate existing debt, you need to ensure that you have enough financial resources to apply to your outstanding balances.

Your monthly mortgage payment shouldn’t exceed 25 percent of your monthly income. But the loss of employment and other factors can cause this percentage to suddenly increase. Homeowners have to consider other necessary expenses such as utilities and taxes when determining their budget needs.

Can Selling a House Eliminate Your Debt?

Selling a house to get out of debt is one of the most effective ways to prevent issues that have lasting impacts on your financial future. Many homeowners downsize to a more affordable home. This reduces their monthly payments, leaving them with more money each month to apply to their debt. Dallas homeowners should consider the consequences of defaulting on mortgages and other loans. Poor credit ratings limit your ability to secure a future home, automobile loan, or even rental property.

Why Sell a Home to Get Out of Debt?

There are many benefits to selling a home for debt relief purposes. Getting out of a mortgage agreement gives you a significant amount of financial freedom in little time. It allows you to move forward towards your financial goals and can provide tax benefits that may not be obtained by simply refinancing your mortgage.

The real estate market has a wide range of opportunities for securing a more affordable home after you sell your existing one. An affordable home reduces your debt burden and may provide a greater return on your investment in the long run.

Homeowners should be careful when selling through a traditional realtor. Commissions and other fees can quickly add up, taking away a significant portion of the purchase price.

Selling your Dallas home “as is” for cash can be the fastest way to get out of your mortgage and move on to the beginning of a new financial future. HomeVestors buys Dallas homes and gives their owners a chance to gain a high return on their investment. This provides them with the financial resources they need to eliminate debt.

Selling your home to HomeVestors also allows you to protect your credit score and avoid the consequences of defaulting on your loans. Choosing to sell your home as- is can be the right way to create a more stable financial future for your entire family.