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We are currently upside down in our home. We have a VA loan. We are wanting to sell. How do we handle the loss?

by amandathorn from Blue Springs, Missouri. Jan 28th 2013 Reply


Steven Ceceri (CreativeFinancingOptionsGroup)
#37 ranked lender in Massachusetts - 723 contributions

Have you considered holding the property as a rental? If you can qualify with the new property's debt, you current non housing debt and your existing housing debt, you may be eligible to purchase a new home. You would need to consider another loan program such as FHA with 3.5% down. I can help you go over this on the phone or offline via a direct email message. Thank you and good luck!

Jan 28th 2013
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William J Acres (William_Acres)
#73 ranked lender in Arizona - 8,414 contributions

You cannot add your negative equity from a sold home into a new home.. no way!!.. if your upside down, you can sell the property and bring cash to the table to handle the negative, or you can short sell the home, however with a short sale, you won't be able to get another mortgage for at least 2 to 3 years after.. If you attempt to rent the home, then the lenders have some pretty strict guidelines in place to be sure you're not attempting to "buy and bail"... so unless you have a verifiable history of rental experience, or enough income to service all your debt including both mortgage payments, then the lender isn't going to allow possible rental income to be considered.. You can also sit tight and wait for the value to rise before selling..!! I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Jan 28th 2013
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We are wanting to purchase a more expensive loan, and do not qualify for the VA short sale.

Jan 28th 2013
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Wanting to know if it needs to be covered in cash at closing, or if it can be carried onto another loan. Thanks.

Jan 28th 2013
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Ryan Romero (REFIryan)
#453 ranked lender in California - 26 contributions

Try to get a non occupying co borrower for you new purchase. You cannot transfer old debt to the new loan.

Jan 28th 2013
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Michelle Curtis Loan Originator NMLS 401173 (EmbassyFundingLLC)
#28 ranked lender in New York - 2,238 contributions

You will have to pay the difference if you want to sell it, and yes in cash at closing.

Jan 28th 2013
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Steve Azarch (sazarch)
#18 ranked lender in Tennessee - 93 contributions

You might want to consider renting the house until the the value comes back up enough to cover your payoff or just a small loss.

Jan 28th 2013
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Joe Shamie (Joe Shamie)
#4 ranked lender in New Jersey - 1,412 contributions

you will need to come up with the cash at closing or get your bank to take a short sale.

Jan 28th 2013
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Thank you. We cannot use as a rental, you can only have one VA loan out.

Jan 28th 2013
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John Schweer (johnschweer)
#9 ranked lender in Missouri - 162 contributions

Actually that is not correct, you can have more than one VA loan depending on your remaining entitlement and the computation of the old home and new home.... i have been a VA lender for 14 years and am Located in Kansas City.... call me to discuss your situation to see if you could qualify.... John 816-412-3568

Feb 1st 2013
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