I need about $20k to get us through a layoff-home equity loan?

[Anonymous]

Anonymous wrote:OP, here are your options:

1) HELOC. That will take 30 days or so to close on. That will give you a comfortable financial cushion since you have so much equity. You will likely miss your mortgage payment for November if you take this route. Your rate will probably be 8-10%. The nice thing about this option is that your payment will likely be interest only so the payment amount will be lower than principal and interest. Also, you can use your proceeds from your home equity line to pay your monthly bill, which reduces your need for actual cash.

2) Credit cards. This is the easiest option and immediate. You should call every one of your credit cards and ask them to increase your limit. Then, just pay the minimum. You can use your husband's salary to pay your mortgage and put whatever else on your credit cards. Your rate will probably be 25%+.

3) Personal loan through the bank. Should be able to close in days (inside of a week or less). Interest rate should be 5-10%.

You can combine these options together. For instance, you can start out with the credit card option and then when your HELOC closes, you can pay off your credit cards. You can do a combo of #2 and #3 together if you don't want to tap home equity.

Sorry to hear about your job loss and hope the above options help you get started in your thinking on how to address your cash crunch.

What a helpful post. OP is dealing with a ton right now and all of these people are piling on making her feel horrible for choices and circumstances instead of attempting to give her any advice + she’s going through the ringer people. Home expenses + job loss + medical expenses + special needs children. Like, give the women a break.

[Anonymous]

Anonymous wrote:I lost my job a couple years ago thinking I’d have one in a few months. Took me over a year, and the job environment was wayyyy better. We downsized our life drastically - sold our house and rented and it was a very good decision. Unless you’re a skilled worker who has a trade I would prepare for the worst and hope for the best.

Yes. It’s incredibly foolish to sign up for a big new monthly payment with no guaranteed return to work in January.

[Anonymous]

Anonymous wrote:

Anonymous wrote:In these cases "unexpected home expenses" = major fancy home reno they couldn't actually afford. Also explains the "appreciation". How do you spend $15-20K per month and have NO emergency fund? That's just patently irresponsible and idiotic. I bet we make less than you do and could live for a year on no income without changing much and closer to 2 in "bare bones" mode.

I mean, have you priced out the cost to replace a roof lately?

People who live in $1.5M should be well-prepared for these types of expenditures. It’s obvious OP was way overextended even before the job loss.

[Anonymous]

Isn't the clear answer a hardship withdraw from OP's 401k?

I know OP will have to deal with the taxes/penalty, but she needs money and she needs it now. She could be in significant, additional debt by the time a HELOC comes through and credit cards have a way of haunting you for years. A 401k loan would be much preferable to a withdraw but think OP already said not an option. And at least with a withdraw, she won't have to find a way to pay it back while digging out of her other debts.

I'm sorry for what you're going through, OP. It doesn't feel great, I know.

We hit some hard times ourselves that took awhile to recover from. We were in our mid-30s with student loans and pre-k tuition (no public option) for two kiddos. My husband's firm split unexpectedly, which disrupted our income significantly for several months, literally weeks after we had just closed on a house. I felt like an idiot because we had extended ourselves, though within reason/making reasonable risks, and it just...all blew up at once. I remember when the couch I had ordered arrived (I had picked out a performance fabric that was non-returnable) before things fell apart--I threw up.

We had to take out a 401k loan and also withdraw a portion of contributions from our Roth IRA. We were able to avoid any hardship withdraws but that would have been next up. Just is what it is.

Unless OP is in her late 50s, there is time to make up the withdraw over the next twenty years.

[Anonymous]

Anonymous wrote:Isn't the clear answer a hardship withdraw from OP's 401k?

I know OP will have to deal with the taxes/penalty, but she needs money and she needs it now. She could be in significant, additional debt by the time a HELOC comes through and credit cards have a way of haunting you for years. A 401k loan would be much preferable to a withdraw but think OP already said not an option. And at least with a withdraw, she won't have to find a way to pay it back while digging out of her other debts.

I'm sorry for what you're going through, OP. It doesn't feel great, I know.

We hit some hard times ourselves that took awhile to recover from. We were in our mid-30s with student loans and pre-k tuition (no public option) for two kiddos. My husband's firm split unexpectedly, which disrupted our income significantly for several months, literally weeks after we had just closed on a house. I felt like an idiot because we had extended ourselves, though within reason/making reasonable risks, and it just...all blew up at once. I remember when the couch I had ordered arrived (I had picked out a performance fabric that was non-returnable) before things fell apart--I threw up.

We had to take out a 401k loan and also withdraw a portion of contributions from our Roth IRA. We were able to avoid any hardship withdraws but that would have been next up. Just is what it is.

Unless OP is in her late 50s, there is time to make up the withdraw over the next twenty years.

This is dumb. Sell your house OP. This isn’t 2008 and you risk foreclosure, you’re very lucky to have a very easy option to collect cash and downsize your life completely scot free. This is not a hard decision.

[Anonymous]

[quote=Anonymous]How did medical bills eat up your savings? You don’t have health insurance? OOP maximums are usually under $20k. [/quote]

OOP maximums assume that you see in-network doctors. For mental health services, it is nigh impossible to find someone who accepts insurance. I did see a lovely doctor who took BCBS, but she passed away. Try to get in as a new patient in DC or metro-accessible burbs and you’ll find psychiatrists, psychologists and the like normally charge about $250 per hour. If I’m lucky, Blue Cross Blue Shield Federal reimburses us at the rate of $81 per visit, after deductible, yada yada. So for example, two visits per week for two family members = @ $250 * 2 = $500 * 52 = $26K out of pocket with perhaps 1/2 of the sessions (26 each) reimbursed at $81.12 = $2109.12 x 2 = $4218.24 reimbursement so about $21,750 out of pocket plus the costs of any additional therapies, medications, and the time and expense to visit the health practitioners. Now, you can deduct any about over 7.5% from tax. We usually do about $30k a year in unreimbursed medical. So if you assume income of $160k, you can deduct any unreimbursed medical expenses over $12k per year. So we end up being able to deduct $18k, which makes a difference but comes no where close to reimbursing us for our expenses.

[Anonymous]

Anonymous wrote:The special needs child can get preschool through the county. Drop the child care.

You can get on a list. And you may not get the services you need.

[Anonymous]

Pour over you husband's employee handbook to see if the University offers any sort of loan/support programs for staff. Any chance you can score family campus housing intended for teaching staff and then you could airB&B your house? Any sort of professor exchange programs with other schools where you guys could move for a semester (again, while renting out your home?)? Will your husband receive any sort of significant holiday bonus? Get a job as soon as you possibly can. I won't say "any" job but settle for a lower end professional job. Wish you'd answer why you seem so sure to have a job come January. Is that optimism or fact?

[Anonymous]

So OP has $700K in equity. Says the house is worth $1.5M and they bought it for $800K. $1.5M value - $700K equity means OP owes $800K on the house? And she said they bought it for $800K. So they put no money down and/or have an interest only loan?

[Anonymous]

Anonymous wrote:

Anonymous wrote:The special needs child can get preschool through the county. Drop the child care.

You can get on a list. And you may not get the services you need.

For 3-5, you will get it if the child is eligible. OP never said what the SN is.

[Anonymous]

[quote=Anonymous][quote=Anonymous]How did medical bills eat up your savings? You don’t have health insurance? OOP maximums are usually under $20k. [/quote]

OOP maximums assume that you see in-network doctors. For mental health services, it is nigh impossible to find someone who accepts insurance. I did see a lovely doctor who took BCBS, but she passed away. Try to get in as a new patient in DC or metro-accessible burbs and you’ll find psychiatrists, psychologists and the like normally charge about $250 per hour. If I’m lucky, Blue Cross Blue Shield Federal reimburses us at the rate of $81 per visit, after deductible, yada yada. So for example, two visits per week for two family members = @ $250 * 2 = $500 * 52 = $26K out of pocket with perhaps 1/2 of the sessions (26 each) reimbursed at $81.12 = $2109.12 x 2 = $4218.24 reimbursement so about $21,750 out of pocket plus the costs of any additional therapies, medications, and the time and expense to visit the health practitioners. Now, you can deduct any about over 7.5% from tax. We usually do about $30k a year in unreimbursed medical. So if you assume income of $160k, you can deduct any unreimbursed medical expenses over $12k per year. So we end up being able to deduct $18k, which makes a difference but comes no where close to reimbursing us for our expenses. [/quote]

Regular counseling sessions over the course of an entire year are not what unexpectedly made OP broke. She’s either lying about medical costs or doesn’t know how to budget which sounds pretty problematic when you have that much money. More money, more problems.

[Anonymous]

[quote=Anonymous][quote=Anonymous][quote=Anonymous]How did medical bills eat up your savings? You don’t have health insurance? OOP maximums are usually under $20k. [/quote]

OOP maximums assume that you see in-network doctors. For mental health services, it is nigh impossible to find someone who accepts insurance. I did see a lovely doctor who took BCBS, but she passed away. Try to get in as a new patient in DC or metro-accessible burbs and you’ll find psychiatrists, psychologists and the like normally charge about $250 per hour. If I’m lucky, Blue Cross Blue Shield Federal reimburses us at the rate of $81 per visit, after deductible, yada yada. So for example, two visits per week for two family members = @ $250 * 2 = $500 * 52 = $26K out of pocket with perhaps 1/2 of the sessions (26 each) reimbursed at $81.12 = $2109.12 x 2 = $4218.24 reimbursement so about $21,750 out of pocket plus the costs of any additional therapies, medications, and the time and expense to visit the health practitioners. Now, you can deduct any about over 7.5% from tax. We usually do about $30k a year in unreimbursed medical. So if you assume income of $160k, you can deduct any unreimbursed medical expenses over $12k per year. So we end up being able to deduct $18k, which makes a difference but comes no where close to reimbursing us for our expenses. [/quote]

Regular counseling sessions over the course of an entire year are not what unexpectedly made OP broke. She’s either lying about medical costs or doesn’t know how to budget which sounds pretty problematic when you have that much money. More money, more problems. [/quote]

She has little ones, doubt it was for mental health. Stop projecting.

[Anonymous]

Anonymous wrote:To all the people suggesting side gigs — how much are you thinking OP will clear with these gigs? Not a lot. She needs $20k. Earning $1k per month isn’t going to make much of a dent in that.

She can keep that side gig going and pay off the credit card debt she is about to go into.We make $3k a month working 8 brunch shifts. We need workers. She is not in DC I think.

[Anonymous]

[quote=Anonymous][quote=Anonymous][quote=Anonymous]How did medical bills eat up your savings? You don’t have health insurance? OOP maximums are usually under $20k. [/quote]

OOP maximums assume that you see in-network doctors. For mental health services, it is nigh impossible to find someone who accepts insurance. I did see a lovely doctor who took BCBS, but she passed away. Try to get in as a new patient in DC or metro-accessible burbs and you’ll find psychiatrists, psychologists and the like normally charge about $250 per hour. If I’m lucky, Blue Cross Blue Shield Federal reimburses us at the rate of $81 per visit, after deductible, yada yada. So for example, two visits per week for two family members = @ $250 * 2 = $500 * 52 = $26K out of pocket with perhaps 1/2 of the sessions (26 each) reimbursed at $81.12 = $2109.12 x 2 = $4218.24 reimbursement so about $21,750 out of pocket plus the costs of any additional therapies, medications, and the time and expense to visit the health practitioners. Now, you can deduct any about over 7.5% from tax. We usually do about $30k a year in unreimbursed medical. So if you assume income of $160k, you can deduct any unreimbursed medical expenses over $12k per year. So we end up being able to deduct $18k, which makes a difference but comes no where close to reimbursing us for our expenses. [/quote]

Regular counseling sessions over the course of an entire year are not what unexpectedly made OP broke. She’s either lying about medical costs or doesn’t know how to budget which sounds pretty problematic when you have that much money. More money, more problems. [/quote]

I’m the person posting about the lack of mental health parity and how easy it is to run up $30K per year in OoP spending when you have two special needs family members. I am not the OP.

[Anonymous]

[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]How did medical bills eat up your savings? You don’t have health insurance? OOP maximums are usually under $20k. [/quote]

OOP maximums assume that you see in-network doctors. For mental health services, it is nigh impossible to find someone who accepts insurance. I did see a lovely doctor who took BCBS, but she passed away. Try to get in as a new patient in DC or metro-accessible burbs and you’ll find psychiatrists, psychologists and the like normally charge about $250 per hour. If I’m lucky, Blue Cross Blue Shield Federal reimburses us at the rate of $81 per visit, after deductible, yada yada. So for example, two visits per week for two family members = @ $250 * 2 = $500 * 52 = $26K out of pocket with perhaps 1/2 of the sessions (26 each) reimbursed at $81.12 = $2109.12 x 2 = $4218.24 reimbursement so about $21,750 out of pocket plus the costs of any additional therapies, medications, and the time and expense to visit the health practitioners. Now, you can deduct any about over 7.5% from tax. We usually do about $30k a year in unreimbursed medical. So if you assume income of $160k, you can deduct any unreimbursed medical expenses over $12k per year. So we end up being able to deduct $18k, which makes a difference but comes no where close to reimbursing us for our expenses. [/quote]

Regular counseling sessions over the course of an entire year are not what unexpectedly made OP broke. She’s either lying about medical costs or doesn’t know how to budget which sounds pretty problematic when you have that much money. More money, more problems. [/quote]

I’m the person posting about the lack of mental health parity and how easy it is to run up $30K per year in OoP spending when you have two special needs family members. I am not the OP. [/quote]

There are therapists and psychiatrists that take insurance if you look hard enough or are flexible. OP isn't saying its mental health.