We’re growing out of our house and need help! After getting married my wife and I bought a small 3 bedroom, 1 bathroom home in Shawnee, Kansas for $165,000 in 2003. Now we have 3 kids and we're outgrowing our home. We just had a REALTOR do a CMA for us on our home and we're surprised that comparable homes were selling for $145,000. Ouch!We need help in moving . . .

Question: We’re growing out of our house and need help! After getting married my wife and I bought a small 3 bedroom, 1 bathroom home in Shawnee, Kansas for $165,000 in 2003. Now we have 3 kids and we're outgrowing our home. We just had a REALTOR do a CMA for us on our home and we're surprised that comparable homes were selling for $145,000. Ouch!

We came into the house as a couple and are now a family of five. We still love the house but it needs some work (probably $7000) and would be better with an addition and an extra bathroom.

Are we stuck here? Is there a way to get out of this house and into a bigger home without forking over thousands just to get out of our home? We have been looking in Olathe and feel that we'll need to spend at least $225,000 to get what we want. Are there industry inside tips that could help? I know several people who have moved and rented out their house. Is this an option?

Thanks for your time.

Kendra S. from Shawnee, Kansas

Answer: Dear Kendra,

Renting is strong in Shawnee so if the rental payment is lower than your mortgage payment to your lender, it may indeed make sense to rent your home in Shawnee until the economy recovers. Rents are strong in Shawnee and rental properties are in demand. When the economy recovers, you could sell your home.

The other option is applying for a Loan Modification through your lender. I have had clients modify their  home loans and now have a fixed rate loans below 3% for the remainder of their mortgage loan period. Mortgage lenders offer their own modification programs and government HAMP Modifications. I suggest contacting your mortgage company to ask for a modification application and visiting the HUD website for government loan modification information, including free HUD counselors.

You may still be able to move out after a loan modification, which would make it easier to cover the cost of your mortgage using the rental income. You would also benefit by writing off the cost of maintaining the house when it is an income property.

If you successfully modify your home loan AND turn it into an income property that produces positive cash flow, and move into a rental property for your family, then you might want to look into qualifying for a home loan to purchase a new home in Olathe. You may find that you can buy a larger home at a lower price than you paid for your current home. Many of my clients are pleasantly surprised at their new mortgage loan payments with the incredibly low interest rates.

Bottom line, homeowners who are not successful in selling their homes have been successful in either a loan modification or renting the home out. You might also get a second opinion on the value of your home. The first REALTOR may have underestimated the value.

Hope this helps, Kendra.

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