Author Topic: can't sell the house - money suck  (Read 3382 times)

changemylife

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can't sell the house - money suck
« on: October 05, 2013, 01:43:27 PM »
Hi everyone. I am hoping to get some replies that are maybe a bit extreme, frugal wise, and outside the box.

Bottom line is that we can't even start my ERE journey because I can't sell my lovely but moderately expensive home.
20+ years to go on it. 

I'm a single mom with 4 sons in their 20's. I got stuck with this house in a divorce 7 years ago because my ex walked away without any bills because he was going to file bankruptcy and I didn't want to, so I took the house (& mortgage) and cars (and payments), and we still had 3 kids at home...so I kept the home intact for them.   Now I basically live here alone...in a 6 bedroom, 4 car garage house that costs me $3k a month.  I have had the house on the market for 18 months, and lowered the price down to my break even point, without even an offer on the house.  The payment and basic cost of living keep rising, and pay cuts kept coming (I just got laid off and now work part time). People can't sell their homes here and many just walk away.

I am 54, and want to get radical with my retirement.  Divorce was really hard on my finances, and I wanted to keep this intact for my kids, but I am tired of this whole money suck...and I want to change my life and am ready to do something drastic.  I hope my question is making sense.  I do have some retirement money in a 401K, but am way behind what I want to be, and based on my age, and my plans to retire for sure in 5 years, I need to get VERY RADICAL.

To further complicate the selling of my house, I now have a structural damage issue (due to drought and then flooding that caused the house foundation/basement to heave and sink, and then crack in multiple places), and is going to cost me $30k, and then I have to disclose this in the seller's agreement.  I feel that I don't want to put 30K more into the house (I have already put $22K into it, updating it.

I worry you all may be so far ahead of me $$ wise that my question wont make sense. I would ask this in a frugal or debt forum but those folks are not extreme. Their idea of frugal and mine are VERY different.  I want a radically different approach as in never financing anything again even houses and cars.  I plan on having an auction soon and selling everything in my house and garages as well to pay off all debts.  I really want out of this predicament.

Thanks

Another Reader

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Re: can't sell the house - money suck
« Reply #1 on: October 05, 2013, 02:16:13 PM »
You just got laid off and you work part time.  The house is costing you $3k a month and needs $30k in repairs to be saleable for less than your breakeven point.  You apparently have other debts.  In your shoes, I would start looking into a short sale.  You can no longer afford this albatross and have an excellent case to present to the bank.  If your state is a recourse state, I would negotiate that with the lender at the same time.

In the end, your future depends on getting rid of the house.  Amputating all of the debt at the same time through bankruptcy might not be a bad idea in your case.  If you post all of your numbers, you will get lots of advice here on what to do.

iamlindoro

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Re: can't sell the house - money suck
« Reply #2 on: October 05, 2013, 02:32:33 PM »
And if in a non recourse state, give some consideration to voluntary foreclosure.  Remember that though your home is a place filled with precious memories, your ownership of it is a business deal and should be approached as such.  You can and do have the power to break the contract with your lender, and the contract has clear consequences for doing so.  There are a lot of things to consider when deciding whether or not it is the right choice for you, but doing so does not make you a bad person and may in fact help you be much more solvent financially.

Peony

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Re: can't sell the house - money suck
« Reply #3 on: October 05, 2013, 02:37:14 PM »
Rent out rooms maybe? With 6 bedrooms and 4 garage spaces, it sounds like you have the space to spare.

Self-employed-swami

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Re: can't sell the house - money suck
« Reply #4 on: October 05, 2013, 02:51:30 PM »
With so many rooms,  could you rent to students/bed and breakfast?

onehappypanda

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Re: can't sell the house - money suck
« Reply #5 on: October 06, 2013, 06:14:14 AM »
You said you lowered to to your break-even point, but can you still sell it below your break-even point and make up the difference with cash in savings (or cash gained through selling other possessions)? I am not an expert in finances so I'll leave the details to other peeps and just say this: we often see it as a "bad deal" if we have to sell something we own, especially something like a house which we expect to gain value, at a loss compared to what we put into it. But ultimately, if it gets you out of that damn house, it's worth it. You're paying for freedom in that case. Don't be afraid to lower the price more if that's what the market demands and you can make up the difference.

Alternatively, other folks here have some good suggestions. Also, your house sounds quite big for a rental, but if the housing market is that bad in your area then the rental market for family houses may be decent. Could you try to rent the place out and just move somewhere really small for yourself? Even if you can't rent it for the mortgage amount, that could help alleviate the burden while you figure out your next step.

mc6

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Re: can't sell the house - money suck
« Reply #6 on: October 06, 2013, 06:36:41 AM »
This sounds like a tough situation. 

Research AirBnB.  This might work in your large space to bring in more cash. 

Might your sons want to go in together to buy the family home?