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Hello. I see similar posts to this one and am hoping for some advice. We are mid-40s, no kids. Annual income $160k. Total debt $70k. This includes student loans, car payments, and mortgage. Our credit card is paid off regularly, right now has $3k which we plan on paying off shortly.
We owe $320k on the home but have been told we can sell for $420k which puts $80k in our pocket.
I was just let go from my job - but can probably find a similar salary job fairly soon. I did apply for unemployment just in case and put our student loans on a 3-month deferment to help.
We live in a city that has a relatively high cost of living, and are really tired of it. We've been here for about 30 years.
Here is our rough plan:
- Embark on Dave Ramsey's debt free plan, including strict budget
- Sell the home, pocket $80k
- Downsize, move to apt.
- Scope out new city, with much lower cost of living
- Rent in new city, then eventually buy
By moving into an apartment in our current city, we estimate a savings of approximately $1k. We could then take that savings and put onto debt, or take some of the $80k profit and pay down debt. Not sure on that.
The market is slowing, and personally I think we are going to keep going down with an incoming housing bubble.
So question is this - should we sell for $80k profit? The $1k savings gives us $12k savings per year. The new city we are looking at moving to is 7 x less cost of living. And we definitely want to move - that's our real end goal.
I think I'm struggling with the $80k profit, initially we thought it be much more than that, like $100k. I'm so unsure of what to do. Thanks.
We live in a city that has a relatively high cost of living, and are really tired of it.
We've been here for about 30 years.
We owe $320k on the home but have been told we can sell for $420k...
I was just let go from my job...
By moving into an apartment in our current city...
You just postpone the move to some other city.
a) look for a good solid job offer. ANYWHERE (well almost).
move there by yourself if you have to. rent a get by apt. dive into the new job.
As the dust settles look for more/better but keep the costs down.
b) sell the current home ASAP for the best price you can get.
Put the net proceeds into something safe like CD's or T-bills
simply selling at 420k (if sold at 100% of listing price) and owing 320k will not net 100k as you mentioned. however, 80k is very high too
how would selling for 420k and still owing 320k put 80k in your pocket?
as real estate commission alone is roughly 6% or 26k of 420k.
then factor in additional closing fees, any inspection repairs or credits, any buyer covered closing costs, etc
I mentioned profiting $100k as profit as we initially thought we could sell for more. Now, we know we will sell for less, which puts less in our pocket.
I estimate a sale price of $420k and $80k in our pocket (roughly) by simply deducting 6% commission and about $1500 listing costs. I understand that closing fees are customarily paid for by the buyer.
a) look for a good solid job offer. ANYWHERE (well almost).
move there by yourself if you have to. rent a get by apt. dive into the new job.
As the dust settles look for more/better but keep the costs down.
b) sell the current home ASAP for the best price you can get.
Put the net proceeds into something safe like CD's or T-bills
c) after a year or two... re-evaluate.
This is pretty much the plan - but I'm confused by your response. What do you mean "You just postpone the move to some other city"? Are you saying that we should sell? We will take that profit, tuck it away or put some of it on debt, move to an apt. here, then move to an apt. in new city.
The reason for this portion of the plan is that we are moving from a 3,000 sq. ft. home into a 1,000 sq. ft. apt. With this major downsizing, we figure that renting in our current city will be beneficial two ways:
1. Savings of approx. $1000
2. Get us acclimated to smaller housing and out and under from a mortgage, i.e. easier to give notice and just leave a city vs. having to selling a home.
I guess we are down to a choice here - sell or stay put?
If we stay put, it would be with the idea of selling next spring. But since no one has a crystal ball on the housing market, this is a risky gamble. We can either make $80k now or gamble on the market next spring.
...and I ignored that aspect of things almost entirely.
You either HAVE TO sell and you WANT to relocate or you HAVE TO relocate and you HAVE to sell.
Do the best deal you can as soon as you can...
so you can move on unencumbered by the mortgage obligation. ASAP.
But until after you have sold you can only guess at what the net proceeds MIGHT be.
Don't plan on any specific number until then... just getting loose from the house and town.
Hello. I see similar posts to this one and am hoping for some advice. We are mid-40s, no kids. Annual income $160k. Total debt $70k. This includes student loans, car payments, and mortgage. Our credit card is paid off regularly, right now has $3k which we plan on paying off shortly.
You might want to post a budget. If your wife makes $160k and you will be getting another job soon you can clean up on the debt. Since your total debt is only $70k including your mortgage I assume most of that is the mortgage? Keep in mind once paid off the cost to keep the house is just property taxes plus insurance. Plus a minor mtc retainer. Not sure where you live but the $1,000 apartment would probably more expensive.
If your goal is to leave anyway then sell the house and move.
Hello. I see similar posts to this one and am hoping for some advice. We are mid-40s, no kids. Annual income $160k. Total debt $70k. This includes student loans, car payments, and mortgage. Our credit card is paid off regularly, right now has $3k which we plan on paying off shortly.
We owe $320k on the home but have been told we can sell for $420k which puts $80k in our pocket.
I was just let go from my job - but can probably find a similar salary job fairly soon. I did apply for unemployment just in case and put our student loans on a 3-month deferment to help.
We live in a city that has a relatively high cost of living, and are really tired of it. We've been here for about 30 years.
Here is our rough plan:
- Embark on Dave Ramsey's debt free plan, including strict budget
- Sell the home, pocket $80k
- Downsize, move to apt.
- Scope out new city, with much lower cost of living
- Rent in new city, then eventually buy
By moving into an apartment in our current city, we estimate a savings of approximately $1k. We could then take that savings and put onto debt, or take some of the $80k profit and pay down debt. Not sure on that.
The market is slowing, and personally I think we are going to keep going down with an incoming housing bubble.
So question is this - should we sell for $80k profit? The $1k savings gives us $12k savings per year. The new city we are looking at moving to is 7 x less cost of living. And we definitely want to move - that's our real end goal.
I think I'm struggling with the $80k profit, initially we thought it be much more than that, like $100k. I'm so unsure of what to do. Thanks.
So the $70k does not include the mortgage, correct? The $70k is inclusive of student loans, car loans, and CC debt?
With moving as your end goal, when do you see that happening? If it's 1-2 years, you'll be saving $24k in mortgage payments but you'll be paying $24k+ in selling fees so it's not really a savings.
I would stay put - keep building equity, keep paying down debt - until you're ready to move to the new city.
So the $70k does not include the mortgage, correct? The $70k is inclusive of student loans, car loans, and CC debt?
With moving as your end goal, when do you see that happening? If it's 1-2 years, you'll be saving $24k in mortgage payments but you'll be paying $24k+ in selling fees so it's not really a savings.
I would stay put - keep building equity, keep paying down debt - until you're ready to move to the new city.
Yeah I don't understand his post at all. We can help but we need a line item budget and asset/liability breakdown.
I'm also confused on how someone with no kids in their mid 40's has student loans.
I mentioned profiting $100k as profit as we initially thought we could sell for more. Now, we know we will sell for less, which puts less in our pocket.
I estimate a sale price of $420k and $80k in our pocket (roughly) by simply deducting 6% commission and about $1500 listing costs. I understand that closing fees are customarily paid for by the buyer.
You’re correct. I don’t know what podunk agents or horrible places people on this forum seem to live but they love to tell you that somehow sellers pay closing costs. I’ve sold 5 homes, I’ve never paid buyers closing costs nor would I ever do that even during the recession. And I paid my agent 5% not 6%, it’s negotiable. I would do the same again especially selling above average priced homes in desirable areas.
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