The kids were fine. All 4 were squealing with delight as they shot each other with Nerf Guns. While the kids, all on the autism spectrum, were having fun destroying the bedrooms, we talked real estate. Everyone wants to know how the market is doing.
I usually get asked about this twice a week and some people really want the stats, but others just want advice and to tell their story.
She was the latter of the two.
She bought in Virginia Beach in 2006 at the height of our market. But, she did well. The house appraised for 20k more than what she paid. So she was stoked. Built-in equity is always good. As time went on, she noticed things about the house that needed work and wanted to re-fi.
We’ll, go figure. Now the darn thing is worth what she owes on it, which is significantly less that what she paid. Not a happy camper. She is like many of us in Virginia Beach. And, now she just wants out.
She can rent it out instead. Her mortgage is very low. She is one of the lucky ones to have a good return on her investment. She had thought about renting it out before, because she asked about having to have reserves in the bank. Yep, you need reserves.
Without hesitation, I quickly texted my wonderful lender at 6:30 on a Saturday night, no less. Whitney said confirmed.
You do have to have reserves : 3-6 months of your current home AND 3-6 months of our purchase.
Lucky for her, she has time to think about renting it out vs. selling it.