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selling home to pay off debt

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jdepp
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selling home to pay off debt  Reply with quote  

I am drowning in debt and would like to know if this decision I am contemplating is worth it. My wife and I have a combined college debt of +-$100000. We have incurred over the last 15 years of marriage about $15000 in credit card & personal loan debt. We have had a combined income for 2-3 years for the time we were married but for the most part living off a single income and now with 2 kids. I am looking into a career change to increase my overall income and taking some part time classes with a weekend job as well. This should theoretically be a good starting point to start paying off the debt including cutting down expenses. We have had medical expenses with my wifes & daughters chronic illnesses, supporting my parents overseas and a list of rather bad luck incidents that have incurred the debt over the years. I feel that trying to pay down this debt will take years and my wife cannot continue working for more than 2-3 years of course depending on her health and when I can begin a new or additional career. I thought that selling our house (homeowner for 4 years now) will provide me a lump sum (if I get my asking price) to pay off the $15000 & gives me an opportunity to start with a clean slate. The idea is to then rent. However when looking at rental prices, it is ironic that my current mortgage, plus taxes, plus home insurance, plus mortgage insurance = a decent 2 bedroom apartment. The only additional expense I have is association fee which includes my water. Does it make sense to do this or am I better off keeping the house and doing the long haul method of paying it off. I have no inheritance or any wish of getting a large sum of money to do this. I have never forced my wife to work but this time I did and would feel miserable if she gets sicker due to all this stress I am placing on her. The alternative I have heard from some is to sell everything and leave the country and then still pay off everything slowly but at least the debt is not in your face.
Post Mon Sep 15, 2014 3:06 pm
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oldguy
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Ultimately you have to quit spending money on taking classes and put your existing $100,000 education to work. That has to be done while you still have many years to do it (we see stories about 60-yr-olds who keep going to school?).

Can you make a good income with your current education? And are there applicable jobs in your region - if not, one solution might be to relocate to where the job market is better?

Do you have equity in the house? Do you have equity in your cars? Usually, you can get better interest rates by using your assets rather than using revolving credit. Ie, refi the house and cars and use the money to pay off the $15,000.
Post Mon Sep 15, 2014 5:33 pm
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littleroc02us
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115k is a lot of debt, but hopefully your area of study is one of need in the market place, otherwise you paid way to much for college. The one thing that jumps out at me is you mentioned supporting your parents. Why are you supporting your parents, if your broke. Unless you have a good reason, that seems to be one way to relieve some money to put towards debt.
The other idea is to look at getting another job that pays more, plus working a side business of some type that pays much better then working for someone else. I remember being in my late 20's with a ton of debt. I got three jobs and worked my butt off and after 5 years we paid it all off except our mortgage.
I love your idea of selling the house. Owning a house is always more expensive then renting even if they are equal. When you rent your not responsible for the roof, the siding, the furnace, the air conditioner, blah, blah. So I think that's a great idea. Hand in there.

Risk comes from not knowing what you're doing. (Warren Buffet)
Post Mon Sep 15, 2014 8:30 pm
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jdepp
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quote:
Originally posted by littleroc02us
115k is a lot of debt, but hopefully your area of study is one of need in the market place, otherwise you paid way to much for college. The one thing that jumps out at me is you mentioned supporting your parents. Why are you supporting your parents, if your broke. Unless you have a good reason, that seems to be one way to relieve some money to put towards debt.
The other idea is to look at getting another job that pays more, plus working a side business of some type that pays much better then working for someone else. I remember being in my late 20's with a ton of debt. I got three jobs and worked my butt off and after 5 years we paid it all off except our mortgage.
I love your idea of selling the house. Owning a house is always more expensive then renting even if they are equal. When you rent your not responsible for the roof, the siding, the furnace, the air conditioner, blah, blah. So I think that's a great idea. Hand in there.


thank you so much for your response. The college loan debt is my wife's and mine combined. Education & engineering degrees. I think you are right, that taking the big step to sell and move all depends on me getting a new job somewhere as the current one obviously is not meeting our needs
Post Wed Sep 17, 2014 4:32 pm
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Lifechanger_
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Hello I was just wondering if you recieved my message?
Post Wed Sep 17, 2014 5:35 pm
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jdepp
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quote:
Originally posted by Lifechanger_
Hello I was just wondering if you recieved my message?


email? no I did not.
Post Wed Sep 17, 2014 8:12 pm
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Lifechanger_
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I sent you a private message. Did you recieve that?
Post Wed Sep 17, 2014 8:18 pm
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RetirementER
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If you decide to look for another job as a way out of the crisis, consider not only where you can make more money but where you can live more cheaply. If you get a higher paying job in a market where the cost of living is higher, you're no further ahead. Ideally, you could find a position with higher pay and lower cost of living! Smile Good luck!
Post Wed Sep 24, 2014 3:22 am
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