If you have lost your equity or even lost your home in the housing market crash, now is a great time to start fresh and climb back out of the mess.  Right now the housing market is starting to pick up and mortgage interest rates are still historically low which gives homeowners several options.

Many people are still underwater on their mortgages and can’t afford to pay their current mortgage.  If this is your scenario, now is a great time to sell your home as a short sale! Buyers are out in droves, and the income tax deduction for debt forgiveness is still good through 2012.

If you had a short sale or foreclosure and ended up with a second lien judgement against you, settle that account. Talk to the lien holder about a settlement plan or in the worst case, perhaps a lawyer to find out about bankruptcy options.

Make sure you go over your credit report to see if all the bad debts that should have been expunged have really been expunged and all the information is current and correct.

Lastly, if you are underwater and are having trouble paying your mortgage but are gainfully employed, talk to a loan officer about refinancing your home.  You may be surprised at the decrease in your payment with the current low interest rates.