Our House Is On The Market

It was about a week ago that we put our house on the market. I never really understood people’s fascinations with their home insofar as I just looked at is as an asset (or liability) if it costs too much to hold on to you just sell it.  If the home no longer meets your needs you sell it. That has all changed for me recently.

When The Wife and I decided on a hard date to put our home up (March 1st, 2012) I immediately thought of all that has happened since I closed on house on that faithful day June 13th, 2007.  I even get a little choked up about it which is big for this emotional wasteland of a guy.

The Wife and I have some AMAZING memories here, we changed from partying 26/27 year olds who are single and might enjoy a 3am party into responsible married parents. We have made some lifelong friends while in this house and lost touch with others.  We have some miracles, some tragedies and some near misses.  I know it isn’t the home, it is us, that has these memories but for some reason I am having a hard time separating the two right now.

The Finances Behind Our Home

Lets put down our tissues and talk about dollars and cents.  We bought the home as part of a special program whose goal is to keep young professionals on Long Island.  The purchase price was $250,000 and for anyone that knows the north Nassau County housing market it is clear that this home was way undervalued.  Actually it was so undervalued that homes that were not part of the program were selling (right before the bubble burst) for over $500,000 in our neighborhood.  Granted those homes were much nicer inside, but same basic living space.  I know some people are thinking $250K for a townhouse? You must be kidding. It is what it is on Long Island…hell, New York City is even worse! You can’t get a one bedroom walk up for less than $450K.

At the time, I got a fantastic rate of 5.875% which seems high today and we put down $17,500.  Interestingly, it had to be a 40 year note as my debt to income ratio was out of whack since I wasn’t married so couldn’t count The Wife’s income towards the mortgage plus I had an auto note and student loans.  Almost all of that down payment was made possible by The Wife’s grandparents who gave gifts over The Wife’s lifetime.  They are/were the epitome of all that was right financially with their generation and deserve a post next week.

The house, while an awesome buy came with some restrictions:

  1. We had to make under a certain amount, which I did because I wasn’t married at the time.
  2. The sale price was tied to the median income of my town at the time of resale.  I remember at the time thinking how much it sucked that the home wasn’t a free market home…and then the housing bubble burst and it looked like I just made the greatest economic decision for myself next to going to law school.

Over the next 5 years the home maximum sale price increased from $250,000 to a bit over $300,000 for a 4% gain per year during the worst housing market correction ever.  I’ll take it!

So upon closing, we will get our down payment back, our gain plus whatever we paid off on the mortgage which is a depressingly low amount! Minus legal fees and possibly realtor fees.

Possibly Realtor Fees?

Another restriction with the program is that we have to give the non-profit administering the program 60 days to get me into contract.

The pro is that I get to help out another young person stay on Long Island and they get all the benefits that I got.  This is REALLY important to me.  Another pro is that I wouldn’t have any realtor fees and at 2 to 4% we are talking about saving $6,000 to $12,000!  That is a lot of money.

The con: They are a non-profit that is not properly set up to sell homes.  They just aren’t a realtors office nor do they have any interest in being one.  So we’ll see if they can sell the home in the allotted time.

Where are We Going?

Where will we end up? Who knows! Right now I am just hoping my marriage survives the stresses that are inevitable in selling a home, closing on said home, maybe moving in with my parents, moving The Wife into my parents, finding a home and closing on said home.

29 Responses to Our House Is On The Market

  1. So you’re one of the lucky people who got one of those houses! I had heard about it through my family who’s still on Long Island but they didn’t know anyone who actually got selected.

    We’re planning on selling our house this year, too. Our target date is the 31st. I have mixed emotions like you do but overall, I know moving is definitely best.

    • Yup! out of 300 lottery entrants I was one of 28 that was chosen. Ironic part is that my brother won the one he applied for in Mas…qua!

      Where are you guys moving?

      • That’s crazy that you both won! I didn’t know that M’qua had one, too. I’ve been gone way too long.

        We’re moving about 15 minutes south of where we live now. Or the beach. Not sure yet.

  2. I definitely know how stressful moving house can be… hope everything works out with a minimal amount of stress for you and the Wife :)

    • I am not too sure how financially rewarding home ownership really is! Doesn’t take into account the 14k to 18K of interest I have paid yearly on it LOL but that is ANY home.

  3. Good luck! I recently sold my apartment and moved, it’s a lot of stress but the buying a new home part is much more enjoyable :)

  4. Good luck! I know what you mean about the emotional side of it. A house is not just dollars and cents. There are a lot of memories and it’s hard to move sometime.

  5. “…plus whatever we paid off on the mortgage which is a depressingly low amount!” This just shows you how much principle you pay on a 40 year mortgage. Very few people seem to realize that you pay the interest first before the actual principle on mortgages. Debt is insidiously evil…

    • Its not that I didn’t realize it, I just didn’t really have a choice at the time. The Wife and I talked about a 10 year ARM for the next one, but the rates don’t seem to be different enough to justify the extra risk.

  6. Oh man how I wish we could sell our house!! Unfortunately, nothing is selling in our area so there would be no point.

    I actually just finished my hardship letter for a loan mod. We are not in desperate need of one but I am a fantastic negotiator and know I cna make a good case on why its better for them to approve it. If that happens I won’t mind so much staying at our current house for a few more years

    • Where do you live Em?

      I have heard those loan mods are a pain in the ass, when their full intent was to help people! So ridiculous. What would the new terms be? How do they work in terms of payments?

  7. I live in Delaware. I’m actually quite optimistic about our loan mod. They can be a pain in the ass if ppl aren’t prepared to handle them. But if you do your research and make a good case in a polite way banks are often willing to help if it financially benefits them(if they will lose less with the mod than with a foreclosure.)

    New terms would lower our interest from 5.75% to between 4.75 and 3. The length of the original mortgage won’t change (we got a 30 yr fixed so it will stay at the 25 years left we have on it.) We pay nothing. So if it goes through this will be awesome!

    • Wow being able to chop off a point or so more with no fees? Sounds like something EVERYONE should at least look into!

  8. Funny my tenant just mentioned that he was thinking about buying a house and I joking said he could but the one he was living in. He took me seriously. Now I’m thinking about selling where it never occurred to me before. If I sell I’ll just upgrade to a 2 unit house.

    • Wow that could work out perfectly, Sandy! Did you price it high enough to give up the income stream? What calcs did you do?

  9. Pretty neat you guys got government aid to not only purchase but profit from your home in this market! Gotta love the government sometimes yeah?

    I’m thinking of selling my home as well, although I don’t have the luxury of paying no realtor fees. That, in it of itself is so awesome.

    Can you explain why you are selling the home? The conclusion seemed muddy eg moving in with parents. Why?

    Thx,

    Sam

    • There is no guarantee that I won’t pay a realtor fee. In fact, it is very likely that the non-profit which is supposed to find me a buyer won’t in their allotted time and I will be using a realtor.

      Can you explain why you are selling the home? The conclusion seemed muddy eg moving in with parents. Why?

      We have out grown the house in terms of size. It is a 2 bedroom and The Wife’s family is visiting more with the boy and since our spare bedroom is now his room it is just getting tight. If it had a basement we probably could have stayed another couple years without feeling tight.

      Could we do it? Yup, we have a neighbor with 3 kids (but no out of town parents), but we have been saving for this moment for a couple years and can afford a modest (in compared to where I live) upgrade.

      • Cool. What about waiting a couple years and saving up the Downpayment? Staying in the rents house now sounds tough, unless they have a 5 bedroom+?

        Give me some thoughts on whether I should sell my house on FS pls. Love to hear em.

        • Staying at my parents is not ideal but I am scared (almost to a fault) of the double mortgage while trying to sell. I have/can get my hands on probably 80% (of the 20% needed) of the downpayment even without selling.

          They do have a nice size 4 bedroom house so it won’t be tight in terms of space, just in terms of parents to wife time together. Lucky for me everyone gets along very well (but then again no one has lived together yet lol).

          I am hoping that if I put together the cash I have plus the equity I pull out I have I can look at a 30 day close on the next house.

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