Quick Answer: Homeowners can potentially keep their homes while eliminating debt through debt settlement strategies like using a HELOC to pay off creditors at reduced amounts. The expert suggests a $20,000 HELOC could potentially settle $40,000 in debt, allowing homeowners to avoid selling appreciated properties in today’s expensive rental market.
Question:
Dear Steve,
I purchased a beautiful home two years ago, in June of 2020. The real estate market just recently boomed, and I discovered I could sell my house and make nearly $100,000 to get myself out of debt. However, I do not wish to sell the beautiful home that I purchased.
Every weekday I read the enforcement actions, filings and fine print the outlets skip, and turn them into the one or two moves that actually improve your position — a rate worth moving for, a fee you can refuse, a deadline to beat before it costs you.
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I would love to keep my house and get out of debt without selling it.
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How do I keep selling the home I love and get out of debt?
Cherlyn
Answer:
Dear Cherlyn,
Home prices did explode, but rental prices exploded as well. So if you sold your house I’m guessing you’d consider renting after selling. So many people are finding rents are higher than mortgage payments.
From what you’ve shared, this sounds like a situation I’d start exploring debt settlement. For example, let’s say you had $40,000 worth of debt. It is plausible that with some expert assistance, you could get a $20,000 HELOC and retire that debt without selling your lovely home.
But I’m making a lot of assumptions here. And debt settlement has factors to consider. See “Debt Settlement Pros and Cons. My No BS Guide to Settling Your Debt.”
Since the numbers are big and the consequences for doing things wrong can be severe, this is one of those situations that would be best discussed with my Debt Coach friend Damon Day. Talking to an expert guide about your specific situation is the most logical and commonsense step to take first.
He can help you create an overall strategic plan of action to implement a solution that allows you to keep the home you love and kick the debt to the curb.
Before You Sign Anything: Run any debt relief contract through the free Contract Decoder to spot hidden fees and unfair terms. Check the company’s complaint history with the Scam-O-Meter.
Compare Your Real Options: Most debt relief companies won’t tell you about all your options — especially the ones they can’t profit from. Credit counseling has a 21-27% completion rate. Settlement resolves about 1% of enrolled debts fully. Bankruptcy has a 95% discharge rate — and protects your retirement. Take the Find Your Path quiz for a recommendation based on your actual numbers.
Can I accomplish both eliminating my debt and keeping my beautiful home?
Yes, you can. I just posted my answer.