So, ask yourself... how much money could you save up in a year, if you tried your hardest and weren't making your mortgage payment?  If your mortgage payment is $2,000 a month, that would be $24,000, but don't forget to add in the property taxes, and then how much more could you put in savings if it was your goal?  Do the math and you may find that you can save more than you ever thought... $25,000?  $30,000?  Or even more in some cases, I'm sure.


Now, stop to consider that most servicers will be willing to make a deal known as cash for keys that will put some amount of money into your hands in exchange for either the short sale or Deed in Lieu of your home.  That amount could be a few thousand dollars, or it could be significantly more, but the point is that if you add it to your savings balance, you might be able to move into a rental home or condo and pay your rent for the entire year to come.


During that year your renting, you won't have to pay property taxes or maintenance as you did as a homeowner, so you should be able to save quite a bit since you will have already pre-paid the year's rent.  So, by the end of the second year, you could expect to have saved more than enough for a down payment on your next home, which you'll be buying at or near the bottom of the market, so you'll have equity again, and have the chance to build more as your property appreciates from its market low price.


The real point is, don't think that you'll never be able to buy a home again because you decided to short sale or Deed in Lieu the one you have now that's underwater by too much to wait around for its recovery. A few years passes quickly, and you can have equity and be rebuilding your credit before you know it.

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