Dave Ramsey helps Bankrate readers

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Six months ago I was transferred from Tennessee to Virginia. I’ve been unable to sell my home in Tennessee. The asking price now is $10,000 below what I owe on it. I’m renting in Virginia and the Tennessee house payments plus rent have drained all savings. Each month now I’m going deeper in debt. I do not want to declare bankruptcy. I see no way out. Please help!! I’ll do whatever you advise me to do.

Richmond, Va.


Make sure you understand the true value of your house. A local real estate agent can help you get a list of what other houses in the area have been selling for. You definitely want to do what it takes to avoid bankruptcy — it’s a gut-wrenching experience. Your best option is, of course, to just find a buyer for the house, but that isn’t happening fast enough.

You may need to talk to your mortgage company about the possibility of a short sale. That’s where you sell the house for less than you owe and the mortgage company agrees to take that amount without coming after you for the difference. Make sure you get it in writing. Another alternative to foreclosure is a deed in lieu (of foreclosure) where you turn over the deed to the mortgage company; they sell the house at auction and agree not to come after you for the difference. Again, make sure you get it in writing. These will make a mark on your credit history, but nothing as bad as a foreclosure or bankruptcy.

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