Philadelphia Weekly

REAL ESTATE

3 considerations before abandoning underwater home

REThink Real Estate

By Inman News Feed

Add Comment | Comments: 0 | Posted Jan. 26, 2012

Whether you decide to hold, sell, or try to make some other changes to your situation then sell as a backup plan, it's important that each action step you build into your plan be set in service of some higher life aim, goal or value.

3. Your priorities. Once you do a deep dive into your values and even list them out in writing, one essential truth will quickly become very evident: You can't (likely) have them all. Early on in this decision process, you'll need to rank your values and objectives in order of importance, and communicate that to the professionals you look to for advice.

There are trade-offs involved in virtually every real estate decision. For example, you might have to give up some tax benefits of property ownership to cut your costs and save your financial acorns for the winter of retirement.

You might have to sacrifice free time and get a side job to make your real estate obligations if you decide to keep the triplex after the mortgage adjusts (if you're currently paying only interest, a mortgage adjustment that happens in January might involve a decrease in interest rate but still increase the overall payment if you have to begin paying toward principal).

Only you can know what's important to you, in your finances and your life, to make the critical decisions you now face. So get clear on your full range of options and the implications thereof, build out a strong sense of your own values and life vision, then prioritize and rank the things that are important to you. Once you have these inputs, your action plan should soon become clear.

Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com.