For those following DR...I need advice on housing!

[Tabrett]

Having moved from an area that loaned $305,000 to 2 people that picked strawberries for a living and had no down payment, i very much feel that this contributed to the the crisis at hand. That was my best friends house - ours was $378,000.... even I couldn't afford to buy it (well, someone would have given me a loan for it - i never would have taken it).

 

:grouphug:

 

Wow! I can't even imagine a person buying a house that cost that much if they were "picking strawberries" for a living. I could probably get a loan for that amount, but wouldn't. What causes people to think they can afford loans way over their means? Do they not realize that when the arm is gone the payment goes way up?

[TraceyS/FL]

Wow! I can't even imagine a person buying a house that cost that much if they were "picking strawberries" for a living. I could probably get a loan for that amount, but wouldn't. What causes people to think they can afford loans way over their means? Do they not realize that when the arm is gone the payment goes way up?

 

Well, welcome to the "mortgage/foreclosure" crisis on the Central Coast of CA. I said it then, 5 years ago, that it was going to happen if they kept making these kind of loans. It would IMPLODE on them and the foreclosure rate would be insane.

 

And they did keep making them. And other areas started doing it. And here we sit.

 

Mind you, that $305k house was an 1100, 1950's track home with some minor upgrades that was bought 6 years prior for $104k.

 

It was insane to watch happen and the time, and I HATE being right now.

[Sara R]

I think a mobile home is fine in a situation like yours: i.e. you can buy it for cash; it is an acceptable neighborhood; it is far cheaper than renting an acceptable living situation; it is used so it has already taken the big depreciation hit; it is not on a rented lot.

 

Dave Ramsey would say it is not okay in a situation like this. I've been listening to him for a year, and he is very consistent with his rules. I agree with the main parts of Dave Ramsey's message: get out of debt. But I disagree with him on the mobile home issue, on his specific investment advice in this specific economic situation, and on his advice to start saving for retirement before paying off a mortgage. And we use a credit card but we have paid it off every month for 13 years. So I guess we're not dyed-in-the-wool Dave Ramsey followers, but that's fine because we are not his primary audience (people who need to get out of excessive debt).

Edited October 13, 2008 by Sara R

[Paula in MS]

Let me give you another way to look at this and a specific example. When my dd6 was born, we sold our house in the city and took our $17M in equity and purchased a mobile home outright. We put it on land that we owned (but had a loan on.) Our goal was to have our debts paid off so that I could quit my job and stay at home. Moving also put us closer to family who would keep dd in the mean-time. Having no rent payment allowed us to pay off all debts (except land payment) and me to quit my job when dd was 2. It was also a blessing when my dh unexpectedly died the following year. I could live on SS and be with dd because of the no rent factor.

 

When I sold the property and mobile home last year (I re-married :D), the mobile home had depreciated in value (which I expected) by half. So, I paid $8,500 for 5 years. I came out much better than renting. In my case, the land appreciated by double so I came out really good.

 

My recommendation is that you look at rents in your area. If you can buy a mobile for what it would cost you for 2 years of rent, buy it. You will recoup some of this when you sell. I would look at 2 years because anything beyond that would be long term and you would probably not be renting beyond that. I listen to Dave Ramsey as well and I am not sure what he would recommend in this particular case, but I do have an MBA in finance and am very conservative financially (debt free except the house).

 

You do need a small emergency fund, though. It will not be much because you will not need to cover a house payment.:001_smile:

 

Paula

[Scarlett]

Let me give you another way to look at this and a specific example. When my dd6 was born, we sold our house in the city and took our $17M in equity and purchased a mobile home outright. We put it on land that we owned (but had a loan on.) Our goal was to have our debts paid off so that I could quit my job and stay at home. Moving also put us closer to family who would keep dd in the mean-time. Having no rent payment allowed us to pay off all debts (except land payment) and me to quit my job when dd was 2. It was also a blessing when my dh unexpectedly died the following year. I could live on SS and be with dd because of the no rent factor.

 

When I sold the property and mobile home last year (I re-married :D), the mobile home had depreciated in value (which I expected) by half. So, I paid $8,500 for 5 years. I came out much better than renting. In my case, the land appreciated by double so I came out really good.

 

My recommendation is that you look at rents in your area. If you can buy a mobile for what it would cost you for 2 years of rent, buy it. You will recoup some of this when you sell. I would look at 2 years because anything beyond that would be long term and you would probably not be renting beyond that. I listen to Dave Ramsey as well and I am not sure what he would recommend in this particular case, but I do have an MBA in finance and am very conservative financially (debt free except the house).

 

You do need a small emergency fund, though. It will not be much because you will not need to cover a house payment.:001_smile:

 

Paula

 

Paula that is a good point about the land issue...if you own the land outright it certainly would not be as bad...the OP says it is family land so don't know if that means it is just being offered temporarily or if they are giving them the land.

 

I also agree with what you are saying about this being a temp situation. If they go into it with that in mind, then they will be fine either way they go. They aren't going to be jobless forever and life will get easier. Just keep moving forward and all will be fine.

[bettyandbob]

OK I haven't read all of the responses, but I interpret your original post to mean that you own a double wide and the place where you live has no good job prospects for you dh. You are considering selling your double wide trailer to a family member and moving somewhere with the hope dh will get a better job.

 

That doesn't sound good to me. I think dh with his MBA should go look for a job elsewhere, find it, and start working. He should rent a room or find other ultra cheap housing until he is established and you can move with him to larger cheap housing. At that time sell the double wide.

 

You have housing, without rent. Why would you give that up while dh looks for a job? It seems to me you'd rack up debt while waiting for the job to come through.

 

What cities look more promising? Do you have friends/family, dh can stay with while he interviews and possibly while he starts a new position?

 

Maybe I didn't understand your post, but it sounded like you were comtemplating being both unemployed and have no place to live. I know being separated from spouse and children is no picnic, but sometimes you have to struggle through that to get to a better place.

[Renai]

OK I haven't read all of the responses, but I interpret your original post to mean that you own a double wide and the place where you live has no good job prospects for you dh. You are considering selling your double wide trailer to a family member and moving somewhere with the hope dh will get a better job.

 

That doesn't sound good to me. I think dh with his MBA should go look for a job elsewhere, find it, and start working. He should rent a room or find other ultra cheap housing until he is established and you can move with him to larger cheap housing. At that time sell the double wide.

 

You have housing, without rent. Why would you give that up while dh looks for a job? It seems to me you'd rack up debt while waiting for the job to come through.

 

What cities look more promising? Do you have friends/family, dh can stay with while he interviews and possibly while he starts a new position?

 

Maybe I didn't understand your post, but it sounded like you were comtemplating being both unemployed and have no place to live. I know being separated from spouse and children is no picnic, but sometimes you have to struggle through that to get to a better place.

 

Hello Betty,

The above scenario does sound bad- but she clarified it (somewhere in this thread), so it's a little better than you described it. They would sell the doublewide, buy another in the city where they want to live (with better job prospects), and have the out-right purchased trailer on family land where they do not have to pay rent (in the same city). So, there'll be no housing payment while he continues the job search. Hope that helps :).