Relocation and mortgage interest rates

[Anonymous]

My company offered a promotion but the job requires relocation. I have a 2.8% interest rate. Current interest rates are so high it’s making it prohibitive to take the offer. How do I negotiate the tell package. What’s reasonable to ask for? While I’m technically being asked to move to a lower cost of living city because of the market and availability I’d likely have to pay close to what I paid 6 years ago in DC to get similar there.

[Anonymous]

What level are you? Did they offer any relocation?

[Anonymous]

You ask that they pay for the relocation and you ask for a raise on top of the new salary that roughly pays the addition increase in interest that you'll be paying on a new mortgage.

[Anonymous]

Op here. I’d like to negotiate my relocation to cover interest. Typically it only covers closing costs, packing and moving. And while I’m getting a pay raise it isn’t coming close to the amount I lose with the interest rate. The other option would be to buy with cash but I’m not sure if it makes sense to give up tax savings.

[Anonymous]

Anonymous wrote:Op here. I’d like to negotiate my relocation to cover interest. Typically it only covers closing costs, packing and moving. And while I’m getting a pay raise it isn’t coming close to the amount I lose with the interest rate. The other option would be to buy with cash but I’m not sure if it makes sense to give up tax savings.

I will never understand the logic behind unnecessarily spending a lot more money in order to pay a little less taxes.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Op here. I’d like to negotiate my relocation to cover interest. Typically it only covers closing costs, packing and moving. And while I’m getting a pay raise it isn’t coming close to the amount I lose with the interest rate. The other option would be to buy with cash but I’m not sure if it makes sense to give up tax savings.

I will never understand the logic behind unnecessarily spending a lot more money in order to pay a little less taxes.

But she is not paying more -- there is a huge opportunity cost to buying a house with cash.

OP, can you turn down this promotion? It seems like it is not in your interest to take it. Alternatively, can you ask for a one time bonus that you could apply to a down payment and bring the cost of the mortgage in line with what you are paying now (assuming you only apply your home equity to the down payment)? I would lean towards doing that vs negotiating for a bigger raise. I would worry that a big raise would leave you vulnerable to a layoff in the future if you were making a lot more than other ppl with your job in the new location.

[Anonymous]

What is the actual differential PITI OP?

[Anonymous]

If the company is willing to pay for closing costs, then you need to call your mortgage loan officer and ask how many points you will need to pay on your new mortgage to buy the interest rate down to 2.8%. It will like be several points, but then ask the company to increase your closing cost allowance to cover that cost.

[Anonymous]

Decline.

[Anonymous]

Anonymous wrote:If the company is willing to pay for closing costs, then you need to call your mortgage loan officer and ask how many points you will need to pay on your new mortgage to buy the interest rate down to 2.8%. It will like be several points, but then ask the company to increase your closing cost allowance to cover that cost.

This is one approach.
OP needs to do some actual math, she’s wiggling a finger in the air right now, and I also think she is trying to upgrade her home.

[Anonymous]

Where are you moving from to?

[Anonymous]

I think you can certainly request an additional one-time bonus to help with the relocation. But it’d come off as fairly immature to approach the company talking about homes and interest rates, even if that is the driving reason behind the bonus request

[Anonymous]

Anonymous wrote:I think you can certainly request an additional one-time bonus to help with the relocation. But it’d come off as fairly immature to approach the company talking about homes and interest rates, even if that is the driving reason behind the bonus request

yup. do the math. how many points and how much. that is on you. the company doesn't care 'why' you need the money. you need to just figure out the numerical bottom line for you. this should take a quick phone call with a mortgage officer and 5 min max in excel

[Anonymous]

Just pay cash.

Then you are ahead and you can use the money that would have gone to your mortgage for something else.

Seems like a win-win to me.

Are you really getting a tax break on your mortgage? That pretty much went away with the Trump tax changes, most people don't have enough to qualify for itemization vs using the standard deduction

[Anonymous]

Anonymous wrote:If the company is willing to pay for closing costs, then you need to call your mortgage loan officer and ask how many points you will need to pay on your new mortgage to buy the interest rate down to 2.8%. It will like be several points, but then ask the company to increase your closing cost allowance to cover that cost.

This. They need to buy down the new mortgage.