Reply to What I don't get: When people complain that they are drowning because their house is underwater

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[quote=Anonymous]NP here.  First, we are not currently underwater (only because we brought $80k in cash to the table to refinance last year**), but our house could probably sell for about $100k less than we bought it for in 2005.  I, personally, am not asking for anyone to bail us out, not the government, not the bank, not our neighbors.  If our house had just held its value, i.e., if we could sell it today for the exact amount we paid 6+ years ago, (absent the refi), we would have over $100k to use on a down payment on a forever home (we're currently in a 2 bedroom TH with 2 kids) plus the $80k we had saved specifically for a down payment.  Certainly no one should be crying a river for us just because we would like a forever SFH that we can't buy right now (because we don't have the down payment), and we are very fortunate that neither of us has lost a job or dealt with any other catastrophies.  Still, for me, the crappy part is just that this investment (and, yes, it's just a bad investment but there is also an emotional component) will affect us financially for the rest of our lives.  I imagine it will be another 5 years or so before we can save the down payment for our forever home after we dumped our down payment savings into the refi (and I'm not talking large, just a simple 3bed SFH in the mid burbs of NOVA).  We bought when prices were high, we can't afford to buy now when rates/prices are low(ish), and by the time we can afford to buy again, rates and prices might be high again.  It's just frustrating because I feel like we're forever in the wrong part of the cycle, and I did not foresee raising my kids til they are late elementary school in a small TH.  Again, I realize there are real problems in this country and in this area, but it really does feel like an emotional and financial dead end, and like we've been set back financially 10 years or so as it will be 10 yrs later that we buy our forever home, 10 years later that we pay off the mortgage, etc.  So, we're just going to be patient and keep saving and keep paying our mortgage (since that's the only way we'll gain any equity it seems), but that doesn't mean it isn't discouraging.  And people who aren't in this situation (of having it good in terms of affording the payments, having jobs, etc but having it bad in that they're stuck in a house/condo that they didn't plan to be stuck in for 12+ years with no options) don't really get it.  They seem to assume that if we're saying "this sucks" then we're expecting a bailout, and that if we're in this situation then we must have bought more house than we could afford and those things aren't necessarily true for everyone.

**We refinanced because we used a 7 year ARM in 2005, planning to sell the house and leave the area in 5 years, but giving ourselves a 2-yr cushion as well.  Last spring when rates were fairly low and it seemed the economy might recover, we were afraid to wait any longer to refinance before the rate started resetting in Dec 2012. We could afford any change but didn't want the uncertainty.  We couldn't sell because we didn't have enough to bring to the table, pay realtor fees, AND have enough to put down on a new house plus closing costs.  We couldn't rent it out because we would be in the hole $800/month between the rental rate and the mortgage payment.  So we refinanced and brought our payment down substanially but we have a long way to go to save enough for a down payment on a SFH again.  [/quote]

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