After months on the market, your home is just not attracting the buyers you’d hoped for. An impending PCS date is creeping up, and the need to sell is becoming more urgent. Although you thought you did everything right to prepare and advertise the house the first time, there are likely some improvements you could make if you dug a little deeper and adjusted the marketing plan.
If you've determined you’ve done all you can to ensure a successful sale and the house remains on the market, know that you have options to move forward. However, alternative selling scenarios need thoughtful consideration because they aren’t ideal, but some choices are less drastic than others.
Stressed military homeowners wondering, “How can I sell my home fast?” and working on a tight timeline, especially when the house is undervalued, will feel that their choices are even more limited.
Here's some guidance for revamping your home selling strategy and determining the best alternative if you cannot sell your house.
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Evaluate Your Home Selling Strategy
Before upending your sale tactics, review a selling your home checklist and ask yourself these questions.
Have you:
- Determined the correct asking price for your home? Houses linger when the price is too high.
- Created and executed the best marketing plan possible? Remember that clear photos are everything to buyers.
- Decluttered, cleaned, and freshened the exterior curb appeal? Poor showings lead to zero offers.
- Considered an expert home stager? They're well worth an initial consultation.
If you’ve answered yes to all of the questions and feel the only way to achieve a sale is to make major changes, then read on. There are more options to consider.
There’s more to learn about home selling strategies, even as a home buyer. Read Have an Exit Strategy for information about what to consider when buying a home with a future sale in mind.
Look for a New Real Estate Agent
Maybe you were initially pressured into using your cousin’s brother’s daughter as representation. This time, invest energy into finding a real estate professional who's at the top of their game and comes highly recommended by friends and family multiple times.
As you look for a new agent, be aware that some might be interested in telling you only what you want to hear because they recognize your desperation to sell. The best agents will be honest and may suggest that your marketing plan is lacking, offering to show you how they could improve it or help revamp your timeline.
Wait for a Better Selling Season
There are dozens of reasons why a house doesn’t sell, but selling at the wrong time is a hard reason to swallow if a military relocation is dictating the move. Weather, selling your home during the holidays, too much inventory, interest rates, and buyer demands are just a few explanations. Homeowners can’t always predict when their market is hot.
Sometimes, it makes sense to wait and sell. Your agent can also help devise a new strategy for waiting, which could include becoming a landlord or finding tenants interested in a rent-to-own situation.
Become a Landlord
As a military homeowner, you probably tried to sell because PCS orders called for a long-distance move. This is an added challenge because geography transforms you into a long-distance landlord, with the inherent difficulties that come with it. Or, the relocation puts you in the market to hire a reputable property manager, thereby increasing the costs of renting your home. Either way, as a first-time landlord, there is much to learn.
Becoming a landlord is common and often a likely scenario for military homeowners. The lack of a home sale revolving around a PCS date is a significant factor, but some service members consider real estate part of their overall investment strategy.
Although taking on renters is a popular option, landlords shouldn’t be hands-off during the process. Landlords must be prepared financially and legally in the event of circumstances caused by neglectful tenants or other factors, such as pest infestations or faulty appliances.
Start with our free guide for military landlords:
Alternatives to Selling Your Home
Hiring a new real estate agent, waiting to sell your home, and becoming a landlord are three possibilities to remedy a stalled home sale. Other options are less than ideal, but these choices can stop financial bleeding and help avoid foreclosure. When considering these last-resort options, it's best to get professional financial and real estate guidance.
Sell for Less than Market Value
You might believe you've set the best price already, but it’s time to scrutinize the money trail once again. At this point, breaking even is the best option, but getting close to that number is also a good place to be. Selling for less than market value is never the best choice, but sometimes it’s the only solution that works in a constrained time frame or a stressed financial situation.
There will always be bargain hunters, so be prepared for the transaction to happen quickly. Individual buyers aren’t the only ones interested in a great deal. Real estate investors and companies that buy distressed homes are also ready to make an offer.
Take out Another Mortgage
Although an additional mortgage may seem counterintuitive, a second mortgage could generate cash for homeowners who are trying to sell due to financial difficulties. Home equity loans or refinancing your mortgage are options, but it's best to talk to a financial advisor. View a second mortgage as a short-term fix, not a solution for long-term problems.
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Consider a Short Sale with Support from Federal Programs
When your home is worth less than the mortgage and buyers are nowhere in sight, a cautiously considered short sale could be the answer. A "short sale" occurs when a home is sold for less than the amount due on the mortgage, often with the property sold as is.
Although it's usually recommended to avoid a short sale, there are advantages to it compared to going through a foreclosure, especially for a military member concerned about maintaining a security clearance. The homeowner’s credit report will document a successful short sale as a pre-foreclosure redemption. A short sale can negatively impact a credit score, but the status will change to "discharged" after the sale. The homeowner may apply for another mortgage in about 18 months if all goes well.
Federal Housing Finance Agency
The Federal Housing Finance Agency (FHFA) helps military homeowners with mortgages owned by Fannie Mae or Freddie Mac. To address hardships from PCS, changes were implemented in 2012.
Service members who have PCS orders are:
- Eligible for a short sale immediately, regardless of whether current or past due on their existing mortgage.
- Exempt from deficiency judgments from Fannie Mae and Freddie Mac if they receive permission for a short sale from the FHFA.
- Relieved of any request or requirement for a cash contribution or promissory note so long as the property was purchased on or before June 30, 2012 (to apply personal assets to cover the shortfall after outstanding unpaid principal balance and sales price).
Additional information and alternate military member programs are available at 1-877-MIL-4566 or 1-800-FREDDIE.
Homeowners Assistance Program
In 1966, Congress enacted the conventional version of the Homeowners Assistance Program (HAP) to mitigate the adverse effects that base realignments and closures (BRAC) had on service members' ability to sell their homes for market value. The HAP relieved those who experienced a financial loss while selling their primary residence during a BRAC process. At this time, HAP applications are only accepted from wounded, injured, or ill applicants and surviving spouses.
Ultimately, there are options for selling your home if the traditional methods are unsuccessful. Before deciding to investigate a short sale or become a landlord, review tried-and-true standards for selling your home quickly and lucratively.
