When does it make financial sense to just dump your house???

[23109VC]

I bought a home a couple years ago – shouldn’t have done it. I failed to listen to many of you here – shame on m e..live and learn.

I paid $380k for a 1900 sq ft home. the house was purchased with 100% financing. 80/20.

I managed to accomplish a loan mod with my first mortage, they changed my 30 yr note to a 40 year note and dropped my rate to 4.8% permanently. that knocked my montly down a good $600. the second is resisting any mods and just recently indicated they woudl drop the rate, but nothign else, and it saves me $100/month.

the latest “comp” that I saw had a house identical to mine selling at about $230k.

so I’m essentially $150k upside down.

my montly “nut” including all PITI, homeowners, etc is about 2500-2600.

a comparable home would like rent for $1800.

I could rent a home twice the size of mine for $2200-2300, but i would not have the tax writeoff.

I earn about $120k/year.

my credit got hosed when I did the loan mod, I’m down in the range where I can’t get a loan.

I can dump the house, rent for the new few years, fix my credit, and then reasses the market and my finances – the upsdie is that I”m out of this negative asset and would likely be living in a nicer / bigger house for the next several years.

i can just stay in this house, make my payments, and see what happens in a few years.

i like my house – but we ended up having another child, unexpectedly. 🙂 and so we know in a few years, when they are all bigger – the house will be too small.

please don’t fire all the “we told you so” emails. I already got those a whlie back when I posted something else… my wife reminds me a lot that we should’ve waited..and nothign you all hurl at me will outweigh her commments..

part of what is so annoying is seeing people buy such better/nicedr houses for hundreds of thousands less…. and realizing that i’d likely have to stayin myhouse and pay on it for a decade or more – just to break even.

i ask myself – over that time period – all that money that I am spending on a monthly basis – i very well may be spending FAR more on the house than I would if i just rented.

at my income bracket, given the typical deductions I see – I”m guessing that I coudl dump my house, and rent something for around 2100-2200 and have the same effective “net” montly housing costs..i lose the tax writeoff, but don’t pay Taxes and various other costs.

other consierations I then worry about – you rent..you get settled in another nice house, and THAT houses owner goes under, house goes back ot hte bank and you get kickd out and the move/dislocation occurs again… but, if I”m saving TONS of money, maybe it’s worth it.

i’m open to any suggestions, ideas, etc.

[CA renter]

Sorry to hear about your dilema, 23109VC, but (and you know this was coming)…you made your bed.

It sounds like your lenders have been very nice about lowering your monthly costs, so you really can’t say you haven’t been helped already.

Also, with a hit to your credit, you will have a more difficult time finding a rental than someone with a good credit score.

Not sure how many kids you have, but our kids share a room, and most of us probably grew up sharing a room with siblings. It might not be optimal, but it’s not bad, either. Some kids really prefer to share a room with their sibling(s).

There are many stories from posters here who have been forced out of their homes because idiot landlords were foreclosed on.

IMHO, it’s best to just stay where you are, be grateful that everyone else is in the same “foreclosure crisis” boat with you; otherwise, you would have been foreclosed on too, instead of getting a very generous loan mod that lowers your payments by $600-$700/month.

I’m really not trying to sound mean-spirited, but people such as yourself were the reason behind the surge in prices that caused all the foreclosures. The collective actions of impatient buyers and foolish lenders are the reason behind all the totally unaffordable and irresponsible bailouts of these same borrowers/lenders…all at the expense of those who tried to do the right thing by waiting and renting.

[CA renter]

Sorry to hear about your dilema, 23109VC, but (and you know this was coming)…you made your bed.

It sounds like your lenders have been very nice about lowering your monthly costs, so you really can’t say you haven’t been helped already.

Also, with a hit to your credit, you will have a more difficult time finding a rental than someone with a good credit score.

Not sure how many kids you have, but our kids share a room, and most of us probably grew up sharing a room with siblings. It might not be optimal, but it’s not bad, either. Some kids really prefer to share a room with their sibling(s).

There are many stories from posters here who have been forced out of their homes because idiot landlords were foreclosed on.

IMHO, it’s best to just stay where you are, be grateful that everyone else is in the same “foreclosure crisis” boat with you; otherwise, you would have been foreclosed on too, instead of getting a very generous loan mod that lowers your payments by $600-$700/month.

I’m really not trying to sound mean-spirited, but people such as yourself were the reason behind the surge in prices that caused all the foreclosures. The collective actions of impatient buyers and foolish lenders are the reason behind all the totally unaffordable and irresponsible bailouts of these same borrowers/lenders…all at the expense of those who tried to do the right thing by waiting and renting.

[CA renter]

Sorry to hear about your dilema, 23109VC, but (and you know this was coming)…you made your bed.

It sounds like your lenders have been very nice about lowering your monthly costs, so you really can’t say you haven’t been helped already.

Also, with a hit to your credit, you will have a more difficult time finding a rental than someone with a good credit score.

Not sure how many kids you have, but our kids share a room, and most of us probably grew up sharing a room with siblings. It might not be optimal, but it’s not bad, either. Some kids really prefer to share a room with their sibling(s).

There are many stories from posters here who have been forced out of their homes because idiot landlords were foreclosed on.

IMHO, it’s best to just stay where you are, be grateful that everyone else is in the same “foreclosure crisis” boat with you; otherwise, you would have been foreclosed on too, instead of getting a very generous loan mod that lowers your payments by $600-$700/month.

I’m really not trying to sound mean-spirited, but people such as yourself were the reason behind the surge in prices that caused all the foreclosures. The collective actions of impatient buyers and foolish lenders are the reason behind all the totally unaffordable and irresponsible bailouts of these same borrowers/lenders…all at the expense of those who tried to do the right thing by waiting and renting.

[CA renter]

Sorry to hear about your dilema, 23109VC, but (and you know this was coming)…you made your bed.

It sounds like your lenders have been very nice about lowering your monthly costs, so you really can’t say you haven’t been helped already.

Also, with a hit to your credit, you will have a more difficult time finding a rental than someone with a good credit score.

Not sure how many kids you have, but our kids share a room, and most of us probably grew up sharing a room with siblings. It might not be optimal, but it’s not bad, either. Some kids really prefer to share a room with their sibling(s).

There are many stories from posters here who have been forced out of their homes because idiot landlords were foreclosed on.

IMHO, it’s best to just stay where you are, be grateful that everyone else is in the same “foreclosure crisis” boat with you; otherwise, you would have been foreclosed on too, instead of getting a very generous loan mod that lowers your payments by $600-$700/month.

I’m really not trying to sound mean-spirited, but people such as yourself were the reason behind the surge in prices that caused all the foreclosures. The collective actions of impatient buyers and foolish lenders are the reason behind all the totally unaffordable and irresponsible bailouts of these same borrowers/lenders…all at the expense of those who tried to do the right thing by waiting and renting.

[CA renter]

Sorry to hear about your dilema, 23109VC, but (and you know this was coming)…you made your bed.

It sounds like your lenders have been very nice about lowering your monthly costs, so you really can’t say you haven’t been helped already.

Also, with a hit to your credit, you will have a more difficult time finding a rental than someone with a good credit score.

Not sure how many kids you have, but our kids share a room, and most of us probably grew up sharing a room with siblings. It might not be optimal, but it’s not bad, either. Some kids really prefer to share a room with their sibling(s).

There are many stories from posters here who have been forced out of their homes because idiot landlords were foreclosed on.

IMHO, it’s best to just stay where you are, be grateful that everyone else is in the same “foreclosure crisis” boat with you; otherwise, you would have been foreclosed on too, instead of getting a very generous loan mod that lowers your payments by $600-$700/month.

I’m really not trying to sound mean-spirited, but people such as yourself were the reason behind the surge in prices that caused all the foreclosures. The collective actions of impatient buyers and foolish lenders are the reason behind all the totally unaffordable and irresponsible bailouts of these same borrowers/lenders…all at the expense of those who tried to do the right thing by waiting and renting.

[pemeliza]

Many factors to consider. I would consider proximity to work for example. If you have a long commute that would be something that you could improve by renting.

Sounds like to me you are looking to a strategic default. Good thing you didn’t put any money down.

I would check with an attorney and see if there are any ramifications of doing the loan mod on your ability to walk away from the loans non-recourse. I know purchase loans are non-recourse but the mod might be viewed as a re-fi.

[pemeliza]

Many factors to consider. I would consider proximity to work for example. If you have a long commute that would be something that you could improve by renting.

Sounds like to me you are looking to a strategic default. Good thing you didn’t put any money down.

I would check with an attorney and see if there are any ramifications of doing the loan mod on your ability to walk away from the loans non-recourse. I know purchase loans are non-recourse but the mod might be viewed as a re-fi.

[pemeliza]

Many factors to consider. I would consider proximity to work for example. If you have a long commute that would be something that you could improve by renting.

Sounds like to me you are looking to a strategic default. Good thing you didn’t put any money down.

I would check with an attorney and see if there are any ramifications of doing the loan mod on your ability to walk away from the loans non-recourse. I know purchase loans are non-recourse but the mod might be viewed as a re-fi.

[pemeliza]

Many factors to consider. I would consider proximity to work for example. If you have a long commute that would be something that you could improve by renting.

Sounds like to me you are looking to a strategic default. Good thing you didn’t put any money down.

I would check with an attorney and see if there are any ramifications of doing the loan mod on your ability to walk away from the loans non-recourse. I know purchase loans are non-recourse but the mod might be viewed as a re-fi.

[pemeliza]

Many factors to consider. I would consider proximity to work for example. If you have a long commute that would be something that you could improve by renting.

Sounds like to me you are looking to a strategic default. Good thing you didn’t put any money down.

I would check with an attorney and see if there are any ramifications of doing the loan mod on your ability to walk away from the loans non-recourse. I know purchase loans are non-recourse but the mod might be viewed as a re-fi.

[UCGal]

I have a few questions for you.

If the house had kept it’s value – market stayed flat rather than declining – would you be anxious to move out of your house? Or would you be content to stay and make the house home?

It sounds like you can comfortably afford the payments on your income. Especially since you were able to do the loan mods. So the only factor is that your neighbors are buying similar houses for less – or paying the same amount to get bigger houses… It doesn’t sound like it’s an issue of you not being able to afford the house you bought.

I’m old school – I really dislike the notion of treating your primary residence as an investment – I think you should buy the house you plan to live in because it meets your shelter needs, your school district needs, your nesting needs. And you buy long term…

My advice – filtered through the thought process of buying a house for shelter, not as an investment, is that you should stay, pay your mortgage, and be grateful for a nice home to live in.

As far as the crowded kids… Like CA Renter, my kids share a bedroom – it’s by choice. Our house is similar in size (2k sf) and is plenty large enough to raise a family in. You’d be surprised how little space you need to raise a family. My husband grew up one of 6 kids in a 1200 sf house with 1 bathroom. He didn’t suffer psychic harm.

[UCGal]

I have a few questions for you.

If the house had kept it’s value – market stayed flat rather than declining – would you be anxious to move out of your house? Or would you be content to stay and make the house home?

It sounds like you can comfortably afford the payments on your income. Especially since you were able to do the loan mods. So the only factor is that your neighbors are buying similar houses for less – or paying the same amount to get bigger houses… It doesn’t sound like it’s an issue of you not being able to afford the house you bought.

I’m old school – I really dislike the notion of treating your primary residence as an investment – I think you should buy the house you plan to live in because it meets your shelter needs, your school district needs, your nesting needs. And you buy long term…

My advice – filtered through the thought process of buying a house for shelter, not as an investment, is that you should stay, pay your mortgage, and be grateful for a nice home to live in.

As far as the crowded kids… Like CA Renter, my kids share a bedroom – it’s by choice. Our house is similar in size (2k sf) and is plenty large enough to raise a family in. You’d be surprised how little space you need to raise a family. My husband grew up one of 6 kids in a 1200 sf house with 1 bathroom. He didn’t suffer psychic harm.

[UCGal]

I have a few questions for you.

If the house had kept it’s value – market stayed flat rather than declining – would you be anxious to move out of your house? Or would you be content to stay and make the house home?

It sounds like you can comfortably afford the payments on your income. Especially since you were able to do the loan mods. So the only factor is that your neighbors are buying similar houses for less – or paying the same amount to get bigger houses… It doesn’t sound like it’s an issue of you not being able to afford the house you bought.

I’m old school – I really dislike the notion of treating your primary residence as an investment – I think you should buy the house you plan to live in because it meets your shelter needs, your school district needs, your nesting needs. And you buy long term…

My advice – filtered through the thought process of buying a house for shelter, not as an investment, is that you should stay, pay your mortgage, and be grateful for a nice home to live in.

As far as the crowded kids… Like CA Renter, my kids share a bedroom – it’s by choice. Our house is similar in size (2k sf) and is plenty large enough to raise a family in. You’d be surprised how little space you need to raise a family. My husband grew up one of 6 kids in a 1200 sf house with 1 bathroom. He didn’t suffer psychic harm.

[UCGal]

I have a few questions for you.

If the house had kept it’s value – market stayed flat rather than declining – would you be anxious to move out of your house? Or would you be content to stay and make the house home?

It sounds like you can comfortably afford the payments on your income. Especially since you were able to do the loan mods. So the only factor is that your neighbors are buying similar houses for less – or paying the same amount to get bigger houses… It doesn’t sound like it’s an issue of you not being able to afford the house you bought.

I’m old school – I really dislike the notion of treating your primary residence as an investment – I think you should buy the house you plan to live in because it meets your shelter needs, your school district needs, your nesting needs. And you buy long term…

My advice – filtered through the thought process of buying a house for shelter, not as an investment, is that you should stay, pay your mortgage, and be grateful for a nice home to live in.

As far as the crowded kids… Like CA Renter, my kids share a bedroom – it’s by choice. Our house is similar in size (2k sf) and is plenty large enough to raise a family in. You’d be surprised how little space you need to raise a family. My husband grew up one of 6 kids in a 1200 sf house with 1 bathroom. He didn’t suffer psychic harm.

[Author]

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