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Old 02-22-2011, 03:05 PM
amandakm1980 amandakm1980 is offline
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Question Just married: Combinging Debts - which house to sell?

I am a 30 yr old woman, just married. I have $50K in credit card debt, $3000 in student loans, and a $62k mortgage, no car payment. I make decent money, and am paying my bills, no late payments ever. My credit rating is starting to suffer due to maxed out cards. However, I am looking at a salary decrease at work in the next 6 months. I have also saved over $15K in retirement (untouchable due to work).
My husband has $5000k in debt, and a smaller house with a $42K mortgage, and a $320 month car payment. He also has work related retirement.
We are combining finances, and starting to get worried. My house appraised for $85K (owe $62k on mortgage). Currently, we have his smaller, cheaper house on the market. My house is fancier, full of furniture and I have spent 10 years remodeling and decorating. However, our financial hardhsips are making me wonder if we have the wrong house on the market. His house is cheaper to heat and cool, less taxes, and less of a mortgage payment.
We are living paycheck to paycheck, and though I have been doggedly making payments and have a small savings account, our looming salary decreases would be devastating. We are both facing the same salary cut, 10%. I know selling my house for $85 K, less real estate fees and capital gains tax would not be enough to wipe out our debt, but the ~$15K debt reduction would be a definite start. Paying over $150 less a month for heating/cooling, and $125 month less for a mortgage payment would be a major help in reducing the remaining debt. Of course, we are currently paying both mortgages waiting for his house to sell. My house would be a sharper house on the market by far. I am looking for some advice, I feel like I am drowning!
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Old 02-22-2011, 09:06 PM
emjo emjo is offline
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Default Re: Just married: Combinging Debts - which house to sell?

I think you know the answer: Sell your house. I know it would be hard, but that's the way the math is working. You may also be able to ask more for the house than the appraised value and get more money to pay down your debt.

I strongly recommend that you follow Dave Ramsey's plan in his book, The Total Money Makeover. You could have your debt wiped out in 2 to 4 years.

Emily
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Old 02-23-2011, 10:37 AM
ralphegermain ralphegermain is offline
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Default Re: Just married: Combinging Debts - which house to sell?

Yes to that. Sell the house that will help you more. Debts can be a 'drowning factor' but that does not mean it is not possible to overcome it all. Especially that you have a partner to plan things out. Choose what will best fit your status not. Be practical. Be wiser.
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Old 02-23-2011, 12:47 PM
khosta khosta is offline
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Default Re: Just married: Combinging Debts - which house to sell?

It seems like the best option is to sell your house and keep his. It would make more sense and wouldn't feel as stressed about your finances. It's sad because you worked so hard on your house but think of it this way - now you can build a home together with his house and remodel together - then it will be more of an "our home" kind of feel!
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Old 04-09-2011, 10:18 AM
Reliable2all Reliable2all is offline
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Default Re: Just married: Combinging Debts - which house to sell?

I first assume that your husbands debt is 5K and not 5000K.

It is not a question of which house to sell? It has already been foreseen from your own perspective that,"My house would be a sharper house on the market by far".And that is true. My advice also would be to sell your house and as Khosta said about your husbands house(above) "then it will be more of an 'our home' kind of feel. "I understand that you are emotionally attached to your home.Who wouldn't!

But let us do some math to know how you are doing- Take the sum of all debts together it may be around 170K+. It is high time now to think of getting out of debt as there is a reduction in your income coming soon. Your debt totals to (50k+62k+3k+your essential monthly expenses X 12months) and your husbands debt totals to(5K+42K+car payment+his essential monthly expenses X 12 months),you will easily find your husband is in a better position to get out of debt.

Having said that, the primary aim of both of you will be to,help you husband to come out of debt immediately. So sell your house at a good price settle your (62k mortgage),and settle your real estate fees and capital gains tax.The balance can be used to pay your student loan 3K and your husbands 5K debt, the remaining should be used to bring down your credit card debt.

Now shred your credit card to pieces. Never use them again. Because this is an unsecured loan and you will not know this until you are in a debt hole. Most people try to dig themselves out of the hole, but usually just end up making the hole deeper and deeper. Be sure you are not surprised. After this both of you should together pay of the Credit card debt.
When finally you are out of debt, you will realize that Debt was a real nightmare, and will never come back to it ever again.

Last edited by DavidBibby; 04-09-2011 at 07:19 PM.
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Old 04-12-2011, 11:13 AM
littleroc littleroc is offline
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Default Re: Just married: Combinging Debts - which house to sell?

I love it when people start answering their own questions. Sell your house and use the proceeds to knock out some of the smallest debts. You need some traction to get the car running. Just think how much you'll save. The question is do you want to keep the same life style with all the fancy debts or do you want to trim it back for a while and pay off all the debt?
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Old 04-14-2011, 04:03 PM
FinancialGuy FinancialGuy is offline
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Default Re: Just married: Combinging Debts - which house to sell?

You house was appraised for $85k? Where the heck do you live? I might want to move there and buy some real estate (I'm from San Diego, you couldn't get a studio for $85k).
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