I met with a recently retired couple who were struggling to make ends meet, most debt, including the home and mortgage were in the husband’s name.
They had their home listed for sale for over a year and despite dropping the asking price, they still did not have any offers. Their debt seemed to just be getting higher and higher and their home kept costing more and more for them to maintain. After taking a look at their finances, it became clear. Their income was from government pensions, they had few assets and there was no equity in the home. In fact he owed more on the mortgage than the value of the house.
They were trying to sell the property so they could move to BC, where their daughter lives with her children. They could stay with her until they found something affordable to rent.
I went over their options and together they decided to just walk away from their home. They knew that there was no equity in the house.
He would still owe on the mortgage after any sale, plus other debt, would put them in the same, if not a worst situation than they are already in.
It was a tough decision for them to do, but in the end, they gave up their home, the husband did a bankruptcy and the couple headed out west and with no stress of collection calls or bills owing, and started the next chapter of their life.