What If I Owe More On My House Than The House Is Actually Worth?

Perhaps the scariest situation for any homeowner is to be behind on payments, trying to sell your house, and owing more than the house is worth.

Falling behind on your mortgage payments can quickly make you feel like you’re drowning, so it’s no surprise that they call it an “underwater mortgage” when someone owes more on their home than its current market value.

Fortunately, you do have options, even if your mortgage is underwater. Underwater mortgages are more common than you might think. You’re not alone. Millions of Americans have been in this position, and — most importantly — they’ve made it through.

Before we go into options, let me assure you that the very WORST option is to do NOTHING and let the bank take back the property via foreclosure.

A foreclosure on your record will absolutely destroy your credit score, affect other ancillary expenses (like insurance), will negatively impact your ability to get a nice apartment or rental in the future, and even affect your ability to get a job!

What Are My Options?

What can a homeowner who owes more than the house is worth, can’t afford to fix the property, and is behind on payment do to avoid bank lawsuits, tax problems, and credit damage?

The very best solutions for an upside down house is to turn it right side again.  The most obvious solutions is to catch up the payments, but most likely, if that were doable, it would have already been done.

So what are some other options?


Did I mention foreclosure may be the worst option?  Actually, bankruptcy is probably even worse!  Bankruptcy will only pause a foreclosure, not eliminate it.  Most mortgage agreements state that if the property goes into default, the bank will take back the property through foreclosure. Then, you will have both a bankruptcy and foreclosure on your credit history for the next 10 years! Plus, you may still be required to work out a repayment plan for the house.

Loan Modification

Loan modifications occur when the bank agrees to reduce principal, interest, and/or payments. Unless you have experience with the Loss Mitigation Dept. at banks, I would recommend working with a legitimate, experienced loan modification company who can prepare an effective argument for the banks because loan modifications do not have a high success rate.  For delinquent borrowers – – a loan modification resulted in an INCREASED payment amount more than half of the time!

Short Sale

A short sale occurs when a third party (like Clean Slate Homes) negotiates with the mortgage company to accept a discount on what is owned and release their interest in a property in exchange for a cash payment. This works well because Clean Slate Homes will agree to purchase the house, providing the bank with a signed Purchase Agreement (which significantly increases the likelihood of a bank accepting a discount).

Here, at Clean Slate Homes, we are happy to offer you a helping hand any time you need to sell your house. If you are behind on payments and owe more than the house is worth, most likely the short sale solution will be your best option.  We can help!  Contact us below and we can walk you through your options.

Don't Pay Commissions to sell your house.


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Ready to take the 1st step towards selling your house?
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Sell Your House

Why work with us here at Ray Owens Group Realty?

Here are some of the reasons so many home sellers contact us to buy their house. We are here to help and offer a fast closing so that you can move on with your life.


We buy so many houses that we save money on closing fees and the contractor fees. This allows us to offer you more.


We pay cash which allows us to buy your house no matter what condition it is in. Don't even think about fixing anything!


We don't charge any fees for our service. We simply just want to buy your house.


Avoid paying thousands of dollars to a real estate agent. They're not needed. We are your buyer. You don't need anyone to help you find a buyer.


Paying cash allows us to close super fast. If you want to close within a week, that's usually possible. If you need some time, no problem!


Paying cash is important. This allows us to skip the hoops banks make buyers go through. This is how we keep things simple.

What client say about us

Jeremy A.
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I had been working two jobs to try to make ends meet, but I was still falling behind on my mortgage payments. I tried to work with my lender to modify my loan, but they refused. I was starting to lose hope. One day, I saw a flyer for . I called them and they were able to help me right away. This allowed me to sell my home for less than what I owed on the mortgage. I was able to keep some of the proceeds from the sale, and I didn't have to go through the foreclosure process. I'm so grateful for. They helped me to save my home and avoid foreclosure!!! I highly recommend to any property owner who is facing foreclosure.
Jessica L.
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After inheriting a run-down rental from my grandma, I was overwhelmed by nightmare tenants and endless repairs. That's when stepped in. They bought the property, handling all the issues swiftly. made selling easy, offering a fair price and taking care of everything. Now, I'm free from the stress of property management. For any owner with property troubles, I can't recommend enough—they're lifesavers!

Frequently Asked Questions

We’ll take a look at the information that you provided and may contact you by phone to get additional details about your situation and the property that you want to sell. Then, after considering all of the specifics of your home, we’ll usually be able to come up with a fair and honest all-cash offer on your property that’s a win-win for both of us. And once you have an offer from our company, there’s no obligation whatsoever for you to accept it. We promise that the decision of whether or not to sell your home will always be totally left up to you. If you do decide to sell your home to us, the process will go fast and you even get to pick a closing date that fits your schedule!

Our fast house buying process is not complicated. We analyze the most recent comparable home sales in the area where your property is located to get an estimate of its current value. Then we make adjustments to the price we can offer on your property based on its condition and any needed repairs. This is the best way to come up with a fair price to offer for your property, since home values constantly fluctuate based on local real estate market conditions.

Real estate brokers and real estate agents make money off of property listings. They market your home, while locking you into an exclusive seller’s agent contract for 6-12 months in most cases, which is the average time that it takes to sell a home in many areas today. Their only goal is to make a total or partial commission on your home when and if it eventually sells, based on which agent finds a buyer for your property. With agent commissions averaging around 5%-6% of a home’s sales price, owners can easily lose thousands of dollars in the process of selling a home, when using an agent. But what’s worse is the prospect of a home that doesn’t sell.


Owners really take a hit, when they’re locked in a home selling contract, losing money on a property every month, that’s often located in a depressed housing market which is also probably worth much less than what they owe to the bank. Homeowners in dire situations like this really can’t afford to wait on a real estate agent to find a buyer for their home. That’s where professional property buyers like us come in. Our company can make an all-cash offer on your property and you can close the deal, pay off your mortgage and even possibly walk away with some much needed cash in your hand in a little as 7 days, instead of waiting months on end to get rid of your unwanted property. We’re not like traditional buyers who comb over a foot-long checklist when buying a property. We’re not looking for a home in a certain neighborhood, a certain school district or a certain location close to our job. We’re looking for properties with only one thing in mind: is it a good investment that we can quickly buy, repair and sell (or rent) for a profit?

If a house is not in need of extensive repairs we can make offers that are near full retail, but if the home has a lot of differed repairs we would need to receive a fair discount.  This allows us to fix up the property at our own expense and resell the property to new owners, while making a modest profit. We work with people in all kinds of situations who see the value in selling their property fast without commissions or costly repairs. Our company purchases real estate in a wide range of prices and helps owners get much needed cash out of their homes in the shortest amount of time, with no out-of-pocket expenses, which they commonly face when selling a house using an agent. The convenience and simplicity of selling your home to professional house buyers can’t be matched, when compared to the alternative of slowly going broke on a property while waiting for a buyer, possibly ruining your credit or getting sued, while being constantly stressed out by calls from bill collectors. We offer a winning solution for many property owners with limited options to otherwise liquidate the value in their homes. There’s never any pressure to accept our offer, so you can just walk away if the numbers don’t match up to your needs.

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