If you can’t afford your mortgage, you should try to sell your home in a short sale.

Q: I live in Georgia and have a house that I bought last year. Unfortunately, I can’t afford the house any longer. I’m not sure what to do. Should I do a short sale or should I just let the bank foreclose. I am trying to do the best I can by not losing too much money.

A: We’re sorry that you’ve experienced a reversal of fortunes. You didn’t disclose why you can’t afford your home, but we’re guessing you must have had some hardship that has caused this change, perhaps divorce, loss of a job, illness or loss of a loved one. Since the change has been in the past twelve months, whatever happened to you must have been unexpected.

It’s clear to us that you should certainly try to sell the home. If you’re underwater with your home, then you’ll wind up with a short sale, if you can’t make up the difference between what you owe and what your home is worth.

Since you bought your home last year, it’s possible that it is worth slightly more than you paid (depending on the neighborhood). Hopefully, the value has risen enough to cover your closing costs.

Depending on how much money you put down to buy the home, you’ll have to expect that most of that money may be lost. But it certainly will depend on the circumstances surrounding your purchase, your sale and the current state of the real estate market.

Start this process by finding a good real estate broker who can list your home for sale. Then get an estimate of all of the closing costs for your sale. Once you have that information, you can make an assumption as to what you will get from the sale and what it will take to sell the home. It will be at this point that you will know if your sale will be a short sale or not.

A short sale is where you sell the home and the proceeds from the sale aren’t enough to cover the costs of the sale and the payoff to the lender. Once you know it’s a short sale, you should contact your lender and find out if the company has a process for allowing you to provide all of your information in advance for them to accelerate the short sale process.

Just so you know, you’re not asking for anything out of the box with this request. Lenders that work with their borrowers in advance assist them, which can accelerate the short sale process.

We hope that whatever personal troubles have sent you into this financial tailspin will soon reverse, and you’ll get back on your feet quickly.

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