Barbara Posted October 2, 2009 Share Posted October 2, 2009 My husband and I are so close emotionally to all these facts, we've decided we need a more objective opinion. We're a one-income family (not a great income either!) of four with two mortgages right now. We originally lived in a small house with a small mortgage (75,000) then decided to build to be closer to my mom in her eighties. New construction went over budget and current home mortgage is 179,000. When we realized the new house was going over budget, we decided to keep the older home and rent it. An okay decision for a year, but even renting the home for $200 more than the payment and both husband and I working part-time in addition to his full-time, we were barely making it. In the meantime, our renters moved out in February, we had a traumatic death in family in March, another death in June, and we're exhausted both physically and emotionally. Finally, I had to stop working since my children needed me due to all the ongoing stresses in our lives. Being objective and only thinking of the money, it seems wise to sell the more expensive house and move back to less expensive...if we can even sell in this market. But new construction is on family land near my mom, etc...a lot of emotion there. We did meet with a realtor at the older home and she felt like the home would not sell for much more than our current mortgage so it's not like we could make a lot of money to help pay for the newer home. We had a couple of interested people for a lease/purchase, but they basically wanted to move in with no down payment, etc. Again, not very helpful for our situation. We are paralyzed in this situation but need to help ourselves soon before it gets worse. I would welcome any advice on how to think through this decision. ~ b Quote Link to comment Share on other sites More sharing options...
chaik76 Posted October 2, 2009 Share Posted October 2, 2009 Would it be possible to sell both homes and buy or rent something closer to your mother, rather than struggle with a too-big mortgage? Quote Link to comment Share on other sites More sharing options...
Mandamom Posted October 2, 2009 Share Posted October 2, 2009 Before you make a decision can you meet with a Realtor about the newest home to see what the market is like for it? At least then you'll have more info regarding your choices. Quote Link to comment Share on other sites More sharing options...
Cera Posted October 2, 2009 Share Posted October 2, 2009 Would it be possible to rent the newer home and live in the older? Quote Link to comment Share on other sites More sharing options...
FO4UR Posted October 2, 2009 Share Posted October 2, 2009 I understand not wanting to let go of family land....do you have a family member who would buy it from you? Quote Link to comment Share on other sites More sharing options...
Denisemomof4 Posted October 2, 2009 Share Posted October 2, 2009 oh, what a tough, tough situation. I'm so very sorry for you and your family. Our family, too, has had a very, very rough few years with death and loss, and that alone is overwhelming to deal with. Perhaps it's a possibility to rent the new home and it would make things easier? It sounds like selling the old home would add more debt, especially after paying for realtor fees, closing costs, etc. If you move to your new home, can your mother move in with you so you can help her out, and perhaps she can help some with expenses? Quote Link to comment Share on other sites More sharing options...
Dayle in Guatemala Posted October 2, 2009 Share Posted October 2, 2009 I guess I would think more long-term. If you sell or lease your newer home, in the long term would it be better for your family? I don't think so. It has a better re-sale value later on when the market bounces back--eventually. I would look at either selling your older home (you won't make a lot of money, but, you'll be essentially bringing money into your family by not paying the extra mortgage) or leasing it. If you lease it to people who don't want to pay a security deposit, I guess I would then up the rent per month and make sure your lease is very specific about what they will pay for in terms of damages. Keep an eye on the property, as in go there to collect the rent so you can see if it is being taken care of. In the long-run it seems wiser to hold on to the new home and figure out something with the older home. I'm so sorry you are going through so much. :grouphug: Quote Link to comment Share on other sites More sharing options...
Scarlett Posted October 2, 2009 Share Posted October 2, 2009 I guess I would think more long-term. If you sell or lease your newer home, in the long term would it be better for your family? I don't think so. It has a better re-sale value later on when the market bounces back--eventually. I would look at either selling your older home (you won't make a lot of money, but, you'll be essentially bringing money into your family by not paying the extra mortgage) or leasing it. If you lease it to people who don't want to pay a security deposit, I guess I would then up the rent per month and make sure your lease is very specific about what they will pay for in terms of damages. Keep an eye on the property, as in go there to collect the rent so you can see if it is being taken care of. In the long-run it seems wiser to hold on to the new home and figure out something with the older home. I'm so sorry you are going through so much. :grouphug: I agree with this. Think long term. Getting rid of the older home will help you in more ways than financially---emotionally you will be free to concentrate on solving the problem of keeping the one house that you do want. Also, much of what has weighed you down this summer is temporary and not ongoing. Once things settle down, and the other house is sold you will be in a position to think of ways to bring in some income to help with the larger mortgage. Quote Link to comment Share on other sites More sharing options...
Harriet Vane Posted October 2, 2009 Share Posted October 2, 2009 :iagree: I think Dayle and Scarlett have offered wise advise. Quote Link to comment Share on other sites More sharing options...
st_claire Posted October 2, 2009 Share Posted October 2, 2009 Can you rent out the older home to multiple family and part of the new home, like the basement? I know the more units in a building the more it brings in. Otherwise I would sell the old home, just to get that off your plate, and live in the new one. You don't need to extra stress of trying to keep both. And what a shame it would be to sell the home you just built. I would also look at raising your income. Can you work part time or can your dh take a second job? Quote Link to comment Share on other sites More sharing options...
Amy in NH Posted October 2, 2009 Share Posted October 2, 2009 I think OP is getting $200/mo income from older home. I think leasing out the new home and living in the old home makes the most sense. Quote Link to comment Share on other sites More sharing options...
Impish Posted October 2, 2009 Share Posted October 2, 2009 I agree with getting rid of the older home, and then refinancing the new (if possible). I wouldn't sell the new home for a few reasons. One, you need a larger home for your family, be it now or a year from now. Two, its family land. Three, closer to your mom. Better to unload the smaller home. Too bad you're not in my area...my rent was just boosted, I might be interested in renting a new place! :lol: Quote Link to comment Share on other sites More sharing options...
Barbara Posted October 3, 2009 Author Share Posted October 3, 2009 I appreciate everyone's thoughtful responses. Here are a few other details if anyone has time to wade through the info....I didn't have much time to post this morning since I had a doctor's appt. We do have debt on top of the mortgages all related to the house expenses...not furniture or anything like that...but building debt on top of the construction mortgage. Originally, the plan was we would be reimbursed for our expenses when the construction loan was closed, but everything was too high already. So, we were left with the debt as well as the high mortgage. As you can tell, building was not a good experience for us! We knew it would be hard, but we thought we could keep it reasonable. I did try working part-time at a job with flexible hours even. The pay was terrible and we were basically using my money for convenience foods because I wasn't home to cook! Plus, after the deaths in our family, my kids just needed me at home since Dad was already working full-time and part-time. The other situation is our homeschool does most of it's activities/classes near the older home. To make it harder, one of my children likes it okay here, but the other wants to move back. Of course, they won't have the final say in what we do, but I do want to listen to them. They're teens now and the social things are much more important. I don't know what we were thinking sometimes when we decided to move?? I know we were thinking of my mom and being closer to the rest of my family, but sometimes I feel like I'm giving up my own family to do that. Where to find balance? I know my mom will be heartbroken if we leave, but I have two other siblings here and other nieces and nephews in their 20's so she's not totally alone. Although she does live alone in her home. I can walk to her house from mine though. The other situation is neither house is really terrible....true, the older home is old and smaller, but on nice property and does have potential to fix up. The new home is a bit bigger (but not much) and nice also. It would be easier if one were horrible!! The other thing we're wondering is if we can really maintain the newer home in good condition. We're unable to do much landscaping, etc. due to expense. Even when we have missed a payment on the older home, we realize we still don't have enough to make it at the newer house. Basically, no buying anything that is not food or house related. The payment is just high compared to our income. Since we've been here, it's actually gone up over $100 due to readjustment of escrow. Thanks for listening to my rambling thoughts...we appreciate it. Quote Link to comment Share on other sites More sharing options...
gingersmom Posted October 3, 2009 Share Posted October 3, 2009 I would put both houses up for sale and hope that either one sells in this market. Quote Link to comment Share on other sites More sharing options...
PollyOR Posted October 3, 2009 Share Posted October 3, 2009 A couple of random thoughts... We own a rental. Tenants can be rough on a new house. I would not rent a house without a contract and at least a first month's deposit. Our experience has been rather poor with dogs. If you do allow dogs limit it to one! Your teens will be gone soon. Where do you and DH want to be in the long run once the kids have moved out and started their own families? We currently rent the other half of our duplex to my parents (3-4 summers). I would love to move to a newer home, but it would mean not being by my parents. My kids have loved getting to know my parents. My parents are from FL and a few days every year or two wasn't enough to really get to know them. Good luck with making the best decision for your family. Quote Link to comment Share on other sites More sharing options...
Dayle in Guatemala Posted October 3, 2009 Share Posted October 3, 2009 I was thinking again about what you asked and I wanted to add one more thing. Your dc are teenagers, and they will be leaving home soon. But, one thing my parents figured out--they don't usually return home alone! They come with college friends, significant others, spouses, children--maybe holding on to the bigger house in the long run will also save money because you won't have to think about adding on too soon. This was my parent's experience! Quote Link to comment Share on other sites More sharing options...
silvermine Posted October 3, 2009 Share Posted October 3, 2009 If you sell the older home, even if you do not profit, at least you don't have an empty house with no renters to worry about. Maintainance, property tax (f they have it in your state), etc.. It would be one thing off your mind -- it may not help you financially, but it's less to think about, no renters to worry about, and no money sink if something breaks! Quote Link to comment Share on other sites More sharing options...
Scuff Posted October 3, 2009 Share Posted October 3, 2009 I'd put both on the market. Whichever sells first for a reasonable amount, sell, live in the other. But your last post kinda makes me think that you should definately sell the new one. It's too much and you can't afford it. Period. I know it's family land and close to your mom, ect. But you can't afford it. You're stressed and drowning and if the taxes or insurance ever go up even a little you're screwed. Let it go. It sucks, but let it go. Then you can decide to move into the old or sell it and rent or buy something cheaper close to your mom, but this option isn't working. One thing Dave Ramsey says a lot on his show is that if you didn't have ____ would you go out and buy one now? Would you want this house if you didn't already have it? I'm guessing no, all things considered. ETA- Another thought, if you can hold out until spring, you might be able to get more for it. Real Estate tends to do better in the warmer months, does it not? Quote Link to comment Share on other sites More sharing options...
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