Wish you could just trade in your keys for a cheaper more affordable home? A lot of troubled homeowners probably wish they could. When the economy went south seven years ago, many desperate homeowners dreamed of trading in their house keys for a more affordable home. When home values ​​tanked, reality set in. While certain areas of the economic sector have greatly benefited from the economic collapse, (investor carry back financing with above average returns) Many homeowners who may or may not have been the victim's of predatory lending practices, now face the challenge of trying to pick up the pieces and start over.

Loan configurations are becoming increasingly more difficult to qualify for regardless of what new “program” is rolled out. Refinancing is probably not an option because of the higher credit standards imposed after the crash. A short sale, an option for some, will still show up on your credit bureau as a foreclosure but it will also cut the amount of time you have to wait to buy a home down the road.

Selling your home at a discount in order to avoid pending litigation and negative reporting to the credit bureau is an option many troubled homeowners are taking. Eliminating a delinquent mortgage from one's credit looks a whole lot better that a foreclosure which is some cases, could lead to the lender seeking a deficiency jurisdiction from the borrower. While this is rare, it has been known to happen. Other factors such as divorce, reduction in wages from your employer or bankruptcy can lead to a must sell situation for homeowners.

If you're faced with a similar situation, do not stick your head in the sand and do nothing. Fire selling your home and living to fight another day is far better than a long slow foreclosure meltdown which could potentially leave you mired in legal mess with your lender for years to come. Do not become a victim, Taking action now and facing the problem head on, will pay big dividends when you go to purchase another home in years to come. Lenders are more likely to work with someone who has shown a commitment to re establishing and maintaining their credit rating than someone who has a foreclosure and historically filed for bankruptcy and never tried to clean up their credit. Character is just one of the five c's banks look at when determining whether to finance a home. You can bet that selling to head off foreclosure will look better than a deficiency judgment on your credit bureau!