I agree with some of the PPs that you should get out now (ie sell the million dollar house). But don't buy one for $800 or $900k. Buy one for $600k. You need to SERIOUSLY reduce expenses if you're ever going to retire.

Instead of getting a refi on the second loan, can't you get another loan at a lower rate and just pay that off?

Anonymous wrote:So, to break this down:

- HHI of $290,000. If we assume a total effective tax rate of 35%, which is optimistic, even considering your massive deductions <headdesk>, your take-home is $188,500.

- Mortgage payment of $7000/month, or $84,000 per year.

- 2 kids in private – figure a minimum of $20,000 each, for another $40,000 (OP, if you tell us you’re getting financial aid for the private schools, I will fucking lose it.)

So, that’s $124,000 of your $188,500 take-home for housing and private school. Awesome. I hope you like working, OP – you’re never retiring.

crazy.

Anonymous wrote:

Anonymous wrote:OP, why do you need such an expensive house? And if you can afford $7,000/mo, why don't you have an accountant tell you what you need to know?

We don't need an expensive house but we really like Chevy Chase/Bethesda. We both grew up in the area and our family and friends are here. It also is a good commute and good schools (although 2 DC go to private) and I feel confident that houses in this area won't lose value. The downside is there are very few houses for much under a million, especially for a family of 6.

There are many houses for under a million that would work for a family of six.

You are in the Chevy Chase/Bethesda mindset. You don't see the gazillion other options out there.

You are way, way overextended, especially with college coming up. First order of business should be public school.

I'm taking this to the other side - what alternatives does the OP have? She's thinking of buying a 900k house instead, but won't have any down payment, so her mortgage will be about the same.

A quick look at craigslist - there seem to be plenty of 3br houses for rent for under $5,000.

So I'd say either refi or rent.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:290k with $7000/mo mortgage plus private school?

OP, you are over-extended. Also, at 6 years you're still not putting in that much equity per month compared to your interest payment.

Yes, we are extremely over extended and I hate it. You're right, at this point most of the mortgage is interest. Hopefully the housing market will continue to get better and our house will appreciate in the next few years.

I think I would take the loss now vs. overextending myself for over 20 years because if you or your DH loses your jobs later, it would probably be more of a loss.

Sorry, I guess I didn't explain myself clearly. If you take a loss now, it's probably better than some time down the line after you have paid even more interest and lose your job but even if you can do it, I wouldn't want that type of stress for the life of the mortgage which I am assuming is 20+ years. I wears you you, your spouse, you children down. My mortgage is 4556 and we make 300k+. I feel it's still manageable but anymore would lead to too much stress for us.

Anonymous wrote:

Anonymous wrote:290k with $7000/mo mortgage plus private school?

OP, you are over-extended. Also, at 6 years you're still not putting in that much equity per month compared to your interest payment.

Yes, we are extremely over extended and I hate it. You're right, at this point most of the mortgage is interest. Hopefully the housing market will continue to get better and our house will appreciate in the next few years.

I think I would take the loss now vs. overextending myself for over 20 years because if you or your DH loses your jobs later, it would probably be more of a loss.

Anonymous wrote:

Anonymous wrote:OP, your numbers don't add up at all. You're either a troll or financially illiterate.

What numbers don't add up? I realize a lot of our income goes to our mortgage but I hate the idea of losing approx 100,000 in realtor fees and closing costs and then having to live in a rental and not building any equity. I think I'd rather gut it out (like we've done for the last 6 years) and get some equity and then use that equity for a down payment on a less expensive house.

Have you tried to sell the home yourself. All you need to do is advertise and all buyers have to do is to get a title company and get a loan. I have sold my homes by myself but I do have a real estate background.

K means a thousand woman! Get it together!

So, to break this down:

- HHI of $290,000. If we assume a total effective tax rate of 35%, which is optimistic, even considering your massive deductions <headdesk>, your take-home is $188,500.

- Mortgage payment of $7000/month, or $84,000 per year.

- 2 kids in private – figure a minimum of $20,000 each, for another $40,000 (OP, if you tell us you’re getting financial aid for the private schools, I will fucking lose it.)

So, that’s $124,000 of your $188,500 take-home for housing and private school. Awesome. I hope you like working, OP – you’re never retiring.

I think you need to fundamentally reevaluate your approach to money and material goods. A 7K mortgage plus private school on 290K is insane.

what were you thinking?

I think you need to sell ASAP. You are very over-extended. Sounds like your children are on the older side. How are you doing on retirement?

Our 2nd mortgage is a TD Bank HELOC. It was a PIA to get but the rate is low. Also try Eagle Bank.

Good luck, OP. Can you cut back any where else? Def. look into moving the kids to public unless there is some sure need to keep them in private. Do you have expensive car loans?
As for college, I would work with DC to consider an in state school at least for a year or two.

Anonymous wrote:290k with $7000/mo mortgage plus private school?

OP, you are over-extended. Also, at 6 years you're still not putting in that much equity per month compared to your interest payment.

Yes, we are extremely over extended and I hate it. You're right, at this point most of the mortgage is interest. Hopefully the housing market will continue to get better and our house will appreciate in the next few years.