Your emotional connection to a house begins the moment you walk onto the property for the first time and begin imagining your life there. You start mentally arranging the furniture, imagining the parties you’ll host, and seeing your future life staged in that space. From that moment on, a huge part of your life is connected to that property, and that can cause many of us to lose sight of what a house really is: probably the largest financial asset you’ll ever own.
That can be problematic if your finances start trending in the wrong direction because you might not be as objective about the home’s value as you need to be. That emotional connection often inspires people to go to extremes to “save” the house. You might win that bet, of course. But you might not—and you have more options than you think. Sometimes selling it before everything goes to hell is the only way to retain control of your life.
First: Don’t panic if finances suddenly become tight
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Panic is the first emotion most of us experience when we lose a job or experience some other kind of financial disaster. If you suffer a lost job, an expensive illness, or another big loss of some kind and find yourself unable to cover all your bills, there’s also often a pride issue—no one wants to admit they can’t pay their bills.
But your first step shouldn’t be reshuffling everything to prioritize paying the mortgage. That can eat up your savings super fast and leave you little room to maneuver. Instead, take a deep breath and look into your options: Find out if you qualify for the Homeowner Assistance Fund Program in your state or other relief programs. Then contact your lender. You may be able to negotiate a revised payment plan or secure a Forbearance Agreement. If you have equity in the house, you might also be able to secure a cash-out refinance that lowers your mortgage payments enough to give you some breathing room.
If these options aren’t viable for you, or if they don’t alter the math enough to keep the house, the time has come to sell—because hanging on until the bitter end just because you love the place is almost always a huge mistake.
When you have to either default on your home or detach from it
Fighting to save a house you can no longer afford can drain your bank accounts pretty fast. And once you’ve burned through those savings, you might become delinquent on your mortgage and your lender may begin foreclosure proceedings. At that point, you have lost control of the narrative: You have no say in how much the house is sold for, who it sells to, or what happens to the proceeds—you may get surplus funds if the home sells for more than you owe, or you might wind up with a deficiency judgment for the remaining balance. This means you just let your house be sold by someone else and you still owe money. And on top of that, your credit score probably takes a dive because of the missed payments.
By listing the house for sale as soon as the cold, hard math tells you that hanging onto it is a long shot, you can maximize the sale price, control the process, and maybe preserve your savings to them stretch further while you figure out the rest of your financial life. Of course, detaching yourself emotionally from a house can be a challenge, but there are a few things you can do:
- Depersonalize. If you’ve reached the difficult decision to sell the house, you should probably declutter and make the home as neutral as possible anyway. Leaning into this process and removing all those photos, knick-knacks, souvenirs, and other memorabilia will help make the space impersonal.
- Behave as if it’s already sold. Saying you’ve decided to sell the house is one thing—behaving like it’s really happening is something else. Taking practical steps can force your subconscious to accept the reality: Downsize your possessions, make whatever DIY repairs and cosmetic changes to the house are recommended by a real estate agent, start seriously looking for a new place to live, and start telling friends and neighbors you’re moving. The more steps you take, the easier it will be to view your home as The Past.
- Focus on negatives. No house is perfect, and yours most likely has a long list of irritations you’ve learned to ignore or tolerate. Now, take Emperor Palpatine’s advice and let your hate make you powerful: Remind yourself about that leaky roof, the squeaky floors, the sauna-like third-floor bedroom, or the freezing bathroom floor.
- Focus on finances. Tell yourself you’re not losing a treasured house, you’re conducting a financial transaction. Focus on what you’re getting out of the transaction—peace of mind, more financial runway—instead of what you’re losing.
Only you know your financial situation, and only you know if the struggle to keep a house is worth it. The key is to try and remove your emotional attachment to the property from the equation and make smart financial decisions around your house before circumstances step in and make those decisions for you.