How do I unload my house?

[PenelopeJune]

We have to sell our house, the payment is killing us. DH's hours have been cut nearly in half since we bought the house, and the payment is roughly 50% of our take home income. He's going to get a second job, but it probably won't pay much and we don't want to have to work, work, work forever just to be house poor.

Anyway, how do we get rid of it? We owe exactly what the agent said we could ask for. If it's easier to talk in real numbers, we owe $89,000 and he said we could ask $89,900. (We live in a LCOL area.) So how can we do this? We'd clearly have to sell it ourselves, because there is no way we could squeeze an agent fee out of it. And then you have to figure at least some closing costs, and the fact that there is literally no wiggle room for people to talk us down on.

Any suggestions? We would like to sell and just rent for awhile. In our area we could get a smaller and probably not as nice house for about half per month what we pay now, which would give us a bit of breathing room.

[PenelopeJune]

Thirty four views and no one can help me yet?

Please don't tell me I'm asking the impossible!

[holidaymama]

89K? That can't be a very high monthly payment can it? maybe 5-600?

What if you just got an extra job until you did sell it...or take the extra job and save that income so if you have to end up selling it for less, you could maybe have the difference saved up?

For that small of a loan, I don't think you want to reck your credit over a forclosure...I would suck it up until it sold...not trying to sound harsh, but even making minimum wage you could pay that, that's a pretty good house payment even in a low col area.

How many hours does hubby work? with 40 hours/week, you should not have too much trouble paying.

Do you qualify for any assistance so that more of your income could go towards the house?

Good Luck mama!

[josybear]

can you refinance with a better interest rate? recast the mortgage to lower the payment?

[PenelopeJune]

It's around $720 a month. DH brings home about $1600 a month. I know it doesn't sound like a lot of money to someone in a HCOL area, but it's a ton to us. We would NEVER let foreclosure happen. By get rid of, I meant sell it so we wouldn't lose any money.

Edit: We can't refinance because we can't afford the closing costs. We got totally screwed in closing, and ended up having to close three different times and pay closing costs twice. It's a big confusing hassle so I won't explain it all here, but suffice it to say I regret ever buying this house.

[holidaymama]

Can't you work? Does he work full time? you didn't answer that one...

Maybe you could post the rest of your bills so that we could see how this is hurting you so badly...and try to help you come up with a plan.

There are a lot of one income families on here that probably have half of their take home going towards a mortgage...whether it be a larger or smaller mortgage...

[KariM]

We sold a house at higher than what the real estate agents told us it could sell at (but that was 7 years ago when the market was a bit better). We bought at 89K and sold for 94K only 18 months after we bought the house.

If you've had that many views and no offers, you might consider changing something about the house.

For us the key was to have new carpeting installed. People feared the 1960s carpeting that was original to the house!

[Ironica]

Talk to a different lender. How long have you been in the mortgage? Have all your payments been on time? Find a good lender who wants your business, and WON'T screw you over on closing costs. You can often roll those into the loan. Of course, don't sign anything unless the payment is lower.

What are your loan terms? 30-year fixed? What interest rate? Maybe we can give you an idea if you might be able to do better than what you've got.

DH and I opted for a loan that's interest-only for the first 10 years. Yes, more expensive in the long run (we pay more, total), but it means that for the first 10 years, our payments are lower, and by the time they go up, inflation and demographic changes have raised our earnings potential by a lot more. (Or if something weird happens and that isn't the case, we can see it coming and have lots of time to change plans.)

Meanwhile, there's no rule we *can't* pay down principal, so we put $10 toward it early on, and our payment then ends up paying a penny or two toward the principal each month. ;-) If we get a windfall, we can always put that toward the principal, and then either pay a lower interest-only payment, or keep our payment the same and get things paid off faster.

We're with Countrywide, btw, and like the way they've treated us.

[PenelopeJune]

Okay...answering questions. Holy moly this is going to be long!

He does work full time, but it's only 3 days a week. He's supposed to get in 40 hours during those 3 days, but they have been cutting back hours (Walmart ) so it hasn't been near that many. His plan is to go and get a second job for the other 4 days. I want that to be temporary though, because I don't want him to work 7 days a week forever just to keep a house. KWIM?

Yes, I could get a job, and I'd really, REALLY like to get out of the house. However I have no skills, so it would be minimum wage. I'd like to wait until DH gets a second job (he can make more money than me) and then try to work around his hours. We only have one car, and daycares are non-existant (except for 2 home daycares, all full) around here so I have to work opposite him. I do have a small internet job I do that brings in a bit of money, but things have been slow lately and there hasn't been any work for me. This has added to my panicky feeling. That money was always used for our car payment.

Once we make some more money, I will feel a lot better and feel like we have more time to plan. The house isn't up for sale at all yet, it's still just in discussions. Oh, I should mention that I really hate the town we live in, and want to move somewhere else, so that is one more reason why I want to sell. So selling and moving won't be a sad thing for us.

BTW, nearly everything in the house is brand new, so there isn't anything for us to improve to up the value. The house was newly remodeled when we bought it 2 years ago.

Rest of the bills:
Mortgage - $720
Car payment - $170
Car insurance - $87
Home phone - $90 (Includes internet needed for my job)
Credit cards - $90 (We have about $2000 on the cards. This is paying just over minimum)
Water/sewer/electricity/trash service - $120 (all on one bill)
Gas - $30 through the summer, about $120 in winter
DirecTV - $60 (has been cancelled today)

Those bills total $1367. That leaves $233 for gasoline, groceries and any other expenses that pop up during the month. Now that we'll free up $60 from DTV, that makes $293. I also owe $130 to the dentist, and they are getting cranky for their money.

We have a pay as you go cell phone, but I usually put $25 on it and it lasts us for at least 3-4 months. The only thing I can really see getting rid of is the phone, but that would lose the little income I usually make on my job. (It's about $160 every two weeks, but I haven't been able to count on it for the last two months. This is the first time it's been like this.)

I'm sorry this is so terribly long! I really appreciate all of your help and time looking at this.

[Ironica]

Originally Posted by PenelopeJune

Yes, I could get a job, and I'd really, REALLY like to get out of the house. However I have no skills, so it would be minimum wage.

Are you kidding? "No skills"? You just wrote a long block of text that was entirely legible, spelled correctly, and was grammatically correct. ;-) You have NO IDEA how useful a skill that is. Or rare, for that matter.

And if you've been parenting, truth is, you have management experience. Granted, you can't put it on your resume like that, but you can discuss problem-solving skills and supervisorial issues in interviews.

Originally Posted by PenelopeJune

Car insurance - $87

This raises my eyebrows. We're in a HCOL area, where car insurance tends to be really high because there's a lot of driving and therefore a lot of accidents. We're paying $110 a month on our one car, for full coverage above the minimums. We do have a $1000 deductible I think, but we have like 5x the minimum liability coverage and collision & comp, plus uninsured driver coverage. We get bonuses for driving less than 7,500 miles a year, being "good drivers", and having been with the company (State Farm) a long time. This is on a 2002 Honda Accord.

So... it seems like you should be able to bring this down, unless you have really bad driving records or a very expensive car.

Originally Posted by PenelopeJune

Home phone - $90 (Includes internet needed for my job)

Again, this seems on the high side. We've got cable phone and broadband for around $70/month. In Los Angeles. Does the local cable company provide phone service? If they do (and there are cables to your house), you might want to compare prices. Even threatening to leave may get your rates lowered.

Are there any "extras" you can drop from that? Before we quit AT&T for good, they'd raised caller ID to $10/month! Without us even noticing, because we didn't study that portion of our bill. We never had call waiting or anything like that from them. We had no long-distance service, because we got long-distance at no additional charge on our cell phones. Do you have more bandwidth than you need on your internet service? Does that include a lot of long-distance calls (which are bundled on most competing phone plans these days)?

You might look at getting a more robust cell phone plan, and dropping the landline entirely, if you can get your internet cheaper from a competitor.

Hope this helps, rather than just sounding like an off-topic nag. ;-) It's not meant that way at all!

[mustangtbn]

I second looking more closely at the phone cost. We saved roughly $15 a month by switching to vonage for our landline phone.

My Dad started using this phone service a few months ago: http://www.magicjack.com that only costs $40 for your first year and $20 each year after. He is very happy with it so far. We wanted to switch too, but they don't have phone numbers for all area codes yet and we need one in our area code. They do have a LOT of area codes though, so it's likely they will have yours. The second we can get a phone number in our area code, we're switching!

Other ideas:
Maybe you could refinance your car?
A friend of mine often recommends timed lukewarm showers to save a bit on gas bills.

It's not a great housing market, but since you're thinking about selling and wouldn't mind moving anyway, it probably wouldn't hurt or cost anything to set a minimum price at which you're willing to sell and just try putting your house on the market to see what happens. It doesn't sound like you'd have to put any money into fixing it up to sell. Good luck - I hope you get some monetary breathing room soon!

[velochic]

I'm not sure where you live, but in the current economic climate, most housing markets are severely depressed and you have to have something very special in a home to get people to buy it. I hear that you hate where you live, but I think the solution is going to be to hang on to where you live and wait to sell when you can make a profit and get out from under the debt safely. It sounds like you have a lot of opportunity (time-wise) to make more money. Your dh can work a second job without it being another *full-time* job. He could do something as simple as offer his services for outdoor work (mowing, mulching, etc.) or if you are rural, talk to farmers to see if they need some seasonal work as harvest season is approaching. As a PP said, the simple fact that you can write an intelligent sentence is more than a lot of people can do. You must be equally as coherent when you speak, and in an interview simply not using "You was" or "I done that" might be enough to land you a job. And it doesn't have to be retail or fast-food. Try your library for clerking jobs, the senior services to see if they need drivers or other help, daycare centers for helper jobs, night stock jobs, various businesses that need "gofer" help. There are a lot of opportunities out there if you ask around. Simply being reliable may be enough to land your some small job. Most places can't afford to hire full-time in this economy anyway, so you may be an answer to their prayers.

Good luck. I know this must be hard to be forced to be in a place you don't want to be and for it to be draining you financially to boot.

[Purplehaze]

I would call the bank

And ask them if they would take back the keys instead of forclusure, if you will get nothing back on it, why go thru the hassle of trying to sell this. I had a friend who did this, it had a slight negative impact on their credit score but they were able to buy again 3 years later. Just ask the bank how it will appear on the credi report.

the only other thing I can think of is to rent it out, if you could get for it what the mortgage costs. But you would need to have some payments worth saved up in case your renters stiffed you for the month.

[violet]

It sounds like you are getting a lot of great advice about ways to keep the house.
I just wanted to add, as far as selling -- you can get almost anything written into a contract if you can get someone to agree to it. See if you can get a buyer to go for that price and have them pay all closing costs. If your market will bear it, and your area will allow it (some areas have it standard buyer or seller or split pays the closing) but again, a willing buyer and a contract that allows it is usually all you need.

[Logan's Mom]

I suppose you could list your home for more then the agent suggested.

I personally think you should make this work until its a better housing market. You didn't mention that it was toxic to live there, its just not your preference.

You DH can find extra work. You could check into lowering your phone/internet expense. You could check into lowering your car insurance.

One thing that popped out at me was that you mentioned only 2 people do daycare. You could make it three! What a fabulous way to earn some extra money. Even if you only took 1 child in, which wouldn't be that difficult, you could get some cash in and stay home (although you said you wouldn't mind getting out of the house so I'm not sure if you would like this choice.)

You also have to remember that being a home owner helps you out tremendously come tax time. That should be taken into consideration when you look at your finances. Did you get a big refund? If so, have DH increase his dependents on his W2. That will add in cash to your budget.

HTH

[PenelopeJune]

Thank you all for your wonderful advice. And yes, I do realize I have skills, especially in the way of writing (I used to be a newspaper reporter) but it seems like people see that I didn't go to college and that's it for me. I also used to be a bank teller. Neither of those jobs paid worth a darn, I could make much more being a waitress! I have been checking out the newspapers for help wanted ads, but there really isn't much in my area. I think to get a job at an office or library or something would take someone dying because those old ladies have held onto those jobs since the beginning of time.

I will check into lowering my car insurance and phone bill. I think I'll call around tomorrow and see what I can find. I've called the phone company before, but they claimed it was the lowest package with internet. None of the internet phone options (like Vonage) are available in our area. I have unlimited long distance for $15 a month, (included in that price) which I think is a good deal. I don't know anyone in our area so every single call I make is long distance. And I'm predjudiced against cell phones, I absolutely hate them, so I don't want to go to cell-only.

I do think that we'll have to stick it out for a bit. Luckily the housing market in our area isn't bad, hasn't really changed over the past 3 years, but the problem is sooooo many houses are for sale. And while our house is very nice, it's nothing special compared to some of the houses up for sale.

As for the daycare option, I've seriously considered it before. Unfortunately, (or maybe fortunately?) I know my limits. I simply do not have the patience to care for other people's children, and I don't think I would be a good babysitter.

I really, really want to go to college soon, so I hope we can dig out of this little hole and move to the town I want to so I can start school.

[lalaland42]

What about freelance writing? No one looks at your resume, just your samples. MDC has a writer forum.

[p1gg1e]

Id not sell

1.) Your going to be hard pressed to find another home at that price

2.) because I JUST sold my house I KNOW that if you sell at that price you will have about $10,000 in closing costs and fees to bring to the table so you will actually be selling at a loss...

3.)Finding rent lower then your house payment....again hard. I found it but its a one bedroom 50 miles away from DH's work

Anywho Id just stay house poor. Work on ways to lower your bills and keep budgeting. I know its rough

[Usually Curious]

Over the years I have taken in babies for extra cash. While it's not what I want to do, it does buy groceries and put gas in the car. It sounds like that is a niche that needs to be filled in your town, which means you can ask a fair price and get it.

(I only watched babies because that is my favorite stage.)

[Free Thinker]

You said there are no local day cares, so why not advertise to watch a child in your home? You may be helping another mama out! I think you could easily make enough to cover your car payment, and anything over that you made I would want to go toward that $2000 on the CCs. That should give you a bit of breathing room. I agree that it's probably not the best time to sell. None of the reasons you listed sound like good ones to me (sorry). Just b/c the housing markets are whacky right now doesn't mean you shouldn't own a home. Your payment is low, if there is an influx of people wanting to rent, rent will go up! I say find something to bring in a few hundred $$ a month (like keeping another child in your home) and stay where you are