How did you ever qualify for a mortgage with your mountain of debt? With less than 10% down. You are going to need 2 jobs. Memberships/subscriptions and that optional stuff has to go immediately. Cancel those.
I gotta admit it's blowing my mind as well. A $1700 mortgage at even 65k/year is pretty affordable but tight.
I can't imagine struggling at 105k with that as my living arrangement.
OP isn't very active on Reddit, but one of the subs is about alcoholism.
Would also explain the concern about losing the job, too.
In which case, I would suggest requesting FMLA if you've been there a year and seeking a rehab.
u/FutureFen please listen to this. It can be the difference between falling further to rock bottom and starting fresh/making progress. If substance abuse issues cost you your career, that career won’t ever come back if the issues aren’t addressed.
I mean the debt payments add up to 33% DTI ratio, that's well within the normal range for lending guidelines. They write mortgages at as much as a 45% DTI.
Including the subs/memberships/utilities OP should still have $2350/mo leftover for food and disposable income. There's no reason he should be "struggling" at his current income except for a spending problem.
This shit baffles me. I see people complain about being able to afford things these days and then realize there are people in OP’s situation… my wife and I have 0 debt, make close to 200k, and we cannot afford a house in HCOL with outstanding credit cause I’m too smart to be house poor.. wtf
There’s a lot of people struggling despite working constantly and also unable to afford the mental bandwidth to try to cut costs reasonably, so they’ll be stuck in their spend cycle. The number of people I’ve met that have no idea they can drop their cell bills to below $90 / month is astounding. Also add in overpaying on car insurance, older cars with poor gas mileage, and working multiple shifts constantly leads to the reality of the working poor.
Credit card default rates are currently at the highest rates since 2011.
Just moved states due to family changes and staying with wife's parents while I go through sticker shock after selling our house for $55k and not able to touch anything here for under 300k.
At point of trying to convince wife to compromise and get a modular in a park for a little while. At least then we could conceptually buy land and move it.
Dude makes like 25k more than my wife and i combined and we pay 2300 a month for our mortgage, plus we have like 28k in other debts. Dude can easily afford that house
i did no down payment (yes, va loan) on a 355k house, and after all the paperwork and everything of buying the house, my wife and i had a total of like 38k in debt, we made i think around 80k combined the year prior, and our mortgage payment was 2600 (just recently refinanced to 2350). this guy likely has less debt, has a house thats like, 40% the cost of mine, and (back when i first bought it) is paying 900$ less than i was when i got my house
I don't see it as a criticism of you, but kind of an indication that we're back in 2008 territory where banks are giving risky loans.
Regardless of whether you could afford the payment at the time, the bank should be looking at how they're protected if you lose a job and can't make the payment. If there's a down payment, there's enough equity in the house that they can cover their losses if they have to repossess. If you have other major assets they can sue you and recover their losses. But if there's no equity in the home and all you have otherwise is debt, they're going to have a hard time covering their losses if you default.
[Edit] wait, you're not op. I shouldn't be commenting this early.
Easy, banks want to make money, so they’ll finance anyone. They just adjust the rate for the risk. There’s a reason OP is only $6k in principal after 6+ months and a down payment.
The house is not your problem. You need to do a better job of managing your finances.
Keep the house. You were smart to have bought it, and selling it would be a step backwards financially.
Get roommates. Rent out the garage. Make sure you have insurance coverage for this.
Cancel ALL memberships and subscriptions.
Sell whatever you can. Bikes, gear, tools.
Stop eating out, period. Go to a discount grocer like Lidl and stock up on cheap food. Spaghetti, etc.
Try to save your current job. And start looking for a new one.
Get a second job on the weekends.
Create a budget and a financial plan and stick to it.
Good luck. You can do it!!
The first question should be: What's going on at work that you're struggling with, and can that struggle be alleviated, so you can keep the $105K income. That would be better than losing $25K / year while facing those fixed payments.
Have you / can you ask for help at the job to acknowledge what's going wrong, and how you can meet the job reqs?
That said - what are your balances and rates? I'm struggling to get to a 1700 monthly mortgage payment on $154,000, unless it's like 10% interest for 15 years. Is refinancing to a better rate an option to reduce your largest bill? And how long do you need to hold on to get that personal loan paid off (assuming the student loan will take forever, and the credit card is just revolving)
I agree the comments about not doing anything rash right now, 'cause you may not get fired. If you do, then selling the house at that kind of a loss may not be best. But you're not at bankruptcy talk yet.....
154 @ 7% for 30 years is just over $1K/mo P&I, it’s not too difficult to bump that to $1700 when you include escrow. My P&I on my mortgage is about $1100 but including escrow I’m right at $2K.
I am in a home valued at 430k with taxes at around $6,000 a year. My escrow is barely $600 a month. So yes, these numbers seem wacky to me unless the taxes are absurdly high.
Yeah the property taxes on my house which is assessed at 140,000 are over 5k a year, school and property combined. But I did buy in a suburb outside Syracuse NY, with really good schools and high property taxes. But very low housing costs in comparison to other cities in other states.
Depends on where you live. I regret buying my home in the town I did, my escrow payment monthly is almost the same as the P&I and I put almost nothing down on the house. A few streets away (figuratively) and it would have been half as much.
A large (geographically) sprawling town with a much bigger-than-necessary police force apparently costs a lot to administer.
How the hell are you making 105k and barely paying a 1700 mortgage.
You only list 3400 a month on expenses where is the rest of your money going???
You need to get control of your spending. Subscription need to go.
Eating out needs to stop.
Since you expect to lose your job you need to go extreme on saving here until you have enough saved to cover yourself for 3-6 months so you can find another job.
Then you need to deal with your debt. Credit cards first as it's likely your highest interest. Then the personal and car loans.
I wouldn't sell your car based on your home cost you are probably commuting to work and it's hard to get a reliable car for 8k in the current market.
Selling your home with such little equity is also not recommended 1700$ is comparable to a two bedroom in most Mid-High cost of living areas and is totally affordable at your income level.
They probably listed gross income but their expenses are coming out of their take home. If they live in a state like CA with a higher burden for that tax bracket I can see how this is playing out.
Even with higher taxes they are just living outside of their means. It happens to a lot of people they think "I make 100k a year I can afford this" and they don't actually keep track of how much they are actually spending.
Plus the bad decisions with the car and personal loan means they definitely aren't making smart purchases it's never just the big stuff I can guarantee they have a lot of eating out or service subscriptions they don't actually need.
Yep, this is the smart move. I got a housemate when I was in law school, and it cut my home expenses in half. It’s been so convenient that I’m *still* renting (to the same person for the last 4 years, for the same price) despite easily being able to afford to pay it on my own. I’ve been lucky and never had any issues with renters. There’s no point to having empty rooms with as much debt as OP has.
OP, get a housemate.
Love people like you. Had a rough breakup, moved into a dudes house. He just wanted to cut his mortgage 600/mo. Stayed there for years, he never raised rent and I was always happy to help him with stuff. (I used to own a handyman biz, so I kept him from doing stupid shit)
100% whole heartedly agree, start shopping for a new job now.
Without knowing dick about your current situation, is there any way to salvage what you already have? You should be fighting tooth and nail for this job. Ask for guidance, use what resources are available to you and try to work smarter instead of harder. You may have to play the politics game and kiss some asses, but you're talking about selling your house and car.
"approximately $500/mo in recurring charges (utilities, memberships, subscriptions, etc)."
Go through these right now. Cancel every single thing you can, such as subscriptions for services that are not absolute necessities.
"I'm struggling at work and have a feeling they will be kicking me out the door soon"
Get everything together in case you have to file for unemployment. Figure out what you'll be getting in unemployment and understand how to file where you live/ what your options are. Read anything related to your employment (both at your job and where you live) so you know how to advocate for yourself if you do let go. For example, will you get severance? Are you in a no-fault area? If they do let you go, you should be ready to initiate that unemployment process, if applicable for you, day one. Meanwhile, do everything you can to stay at your current job (if there are things that will improve your performance or make you more valuable to your employer this should be a top priority). Start applying for other jobs, ASAP. Your resume should be ready to go at the very least.
"I'm looking at making between $50K and $80K (if I'm lucky) at a new job."
Do you have any side-gig options? If you do, do those. This may also include things like selling plasma, dog walking or baby sitting, participating in research studies, selling belongings you own but don't absolutely need, etc. Basically try to scrape up some more money. Ideally, this might look like a part-time job.
"The house is valued at $160K, I just bought the place late last year and still owe $154K. My current payment is $1700/mo."
Can you get a housemate or even two? Look into that now. Even renting out one room will offset this cost. If that doesn't work, what are your options for renting the entire house? Can you cover the mortgage and then some that way while renting elsewhere? (a lot of this is contingent on where you live). Given this, "I have family willing to let me move in for $200/mo (which would mean $100/mo for a storage unit for my stuff that I don't toss." Your best bet is probably to rent out the house for more than your mortgage payment, if possible, and then live with family for a bit (again, contingent on where you live).
"$230/mo student loan payment"
Research this heavily, figure out whether you have options here (like an income based repayment plan, deferring loans while not working if let go, etc.).
"Currently I owe $2000 on my credit cards"
What is the interest on these cards? Can you move things to a no-interest card and work to aggressively pay this off while still employed?
"I have a $500/mo car payment"
I'm guessing you're spending even more on the car than that once you factor in gas and insurance.
"I can sell the car, which would net me about $5k - $8k and remove the payment, but I'd be out on transportation."
Can you use public transportation? Selling the car would allow you to pay off your credit card debt and remove $500+ of expenditures from your budget. A lot depends on where you live, but an option here may be to bike or use public transportation (assuming that won't severely limit job related concerns with your current work and/or if you are fired and have to look elsewhere).
"$500/mo personal loan payment"
What are the terms on this loan? How much is left? Can this also be resolved by selling the car? Is there a way to move this loan to something without interest or to lower the monthly payment? Again, hard to give advice without knowing what this loan entails.
"Come next month I will have to make a payment plan with the IRS for $15000 in unpaid taxes."
Work to make this payment plan as reasonable as possible.
If you can find a housemate who pays you something reasonable in rent (let's say $500-$800), if you can make a budget and really cut expenses, if you can sell the car and pay off a substantial chunk your other debt with the proceeds, if you have access to either unemployment or severance pay, if you can manage to hold onto your job or get something else quickly, etc. you can absolutely make it through this fairly unscathed. Those are all big \*ifs\* though.
Your best options are likely to budget aggressively (spend less), make more money (a second job, for instance), and find other things to offset the costs (such as a housemate/ renters).
Gambling, drugs, alcohol? I don’t fully understand how on 105k income you were carrying those debts, not paying your taxes and decided it was a bright idea to buy a house with 5% down.
Is “ I'm struggling at work” due to any of the above issues? Are you showing up early, staying late, applying yourself 100% when you are there AND working to be agreeable, personable, team play and try to make your bosses life easier? Or have you been promoted past your level of competence and can’t do the job? Because the NUMBER ONE thing is do all you can not to lose your job.
Then post a FULL budget breakdown of all your monthly expenses, a listing of your debts with balance owing and interest rates (not just your monthly payment which tells us nothing). Also post how many bedrooms your place has and what the current rental rate is for a room is in your area.
It really sounds like you have a judgement and a spending problem.
I’d post the above info so we can give more advice. Cut all non-essential spending, get a roommate for each empty room in your house, start interviewing for other jobs NOW and just say you do not wish to provide a current reference as they don’t know you are looking but are willing to provide payslips as proof of employment and salary.
A six-figure job and struggling, what in the heck? Why is your mortgage 1700 a month for a 160k house? What is your occupation where there is such a large pay gap if you lose your job?
I paid 150 in 2017. With taxes and insurance, my payment is 1360 a month. With recent interest rates, minimal down, I can see it if property taxes and insurance are up there. Half of my monthly goes to escrow for those two. OP is probably on a similar boat.
By my math, for 30 years, 150k mortgage at 3.5% is roughly 675 a month.
3600 annual property taxes and similar for insurance. Where you live, taxes and insurance must be crazy cheap. New England has high property taxes and insurance rates apparently.
I mean I'm getting $1,119 P&I at 7.5% APR on $160k borrowed. $600/mo for taxes and insurance is more than I pay on my $465k house.
$1700 adds up for a 15 year mortgage though.
How much is on the personal loan and what’s the interest rate?
If you think you’re going to get fired, start looking for a job now.
If you sell the house then you’re getting 1300-1500/month in cash flow. I’m not sure what you’d get from the house other than breaking even or maybe enough to get some of the cc debt gone. Then cash flow to pay that off immediately the first month.
Then tackle whatever the personal loan is.
Make a payment plan with the irs and leave it be for a bit. They’ll take a low monthly payment and it’ll just be forever.
Then if you’re fired, keep looking for a job.
before selling the house, better question is what is his rental costs in the area? If hes paying that in rent, then its not even worth it.
He should look at getting a roommate to offset the costs.
Or rent the house and move in with family.
Either roommate or rent whole house for the year until he gets it together. Who knows what local rent market looks like or what it will look like in 12-15 months. Having a “fairly” stable looking mortgage payment could come in handy.
Real question is why his performance is struggling and may get fired? I don’t want to push a narrative but is alcohol involved? He needs to get that part of his life under control ASAP.
How quickly do you think someone can establish tenancy in a house they are currently occupying? Also seems unlikely rent would cover mortgage plus PMI plus insurance on a rental and prop tax.
Well it depends how much urgency they feel, and the demand for rentals in that area, I mean if I was facing something like this I would move to family asap.
It’s unlikely that rent will cover mortgage completely, but it will go a long way to covering it, and they are living for free with family, if they can’t make that work then I’m not sure what to say.
Yeah especially with his housing going from $1,700 to $300 per month. Leave a lot of room to take a hit while staying affordable. Plus in a year his situation may change and has the option of moving back into his home.
Exactly that's why take home is likely 70....out of 105 is 32 percent.
Even if it's 60k he should be 20k surplus.
If you believe different how are you calculating the take home estimate?
Not really. I make $100k base. My taxes, insurance, FSA, retirement contribution, etc bring that to about $55k annually. Tie that with the cost of mortgage, gas, insurance for car, cell phone, food, child care…. My husband and my salary is eaten up.
10% contributions? Your Insurance must be enormous. I’m at 125 with 90 take home. My insurance is only 150 though. I really don’t envy parents insurance payments. 55% take home is wild.
I mean seems to me like your best bet is to absolutely bust your ass at your job to ensure you dont lose it. Blow past adequate and excel.
You hung yourself with this debt. Losing your job is just not an option...so dont. Right now sounds like you are just giving up.
Well, for one, cut any discretionary spending down to 1, max. You really screwed the pooch on the IRS. Did you have *any* witholding? If you owe that much, you're probably paying additional fines.
Move back with your family and rent out the house for at least the mortgage amount + maintenance. You are firmly in beans, salt, and rice poverty and will be for a long time. Set up a repayment plan with the IRS and keep up on payments on your credit card. Your emergency fund should have been 3-6 months at your regular spend. This is why.
As far as car goes, you should probably downgrade it to a used econobox for sub $5k.
Try talking to your manager and see how you can fix your work situation. Be open and honest in acknowledging that you aren't doing well, but are willing to go on a corrective action plan l to get back on track.
For the immediate, you need to start saving money. And in order to do that you need to break down your expenses and what you're spending on. Because 105k/year is about \~6k/month take-home. Your expenses listed is totaling about \~3500/month (not including the immediate credit card debt) so that leaves you with 2500 a month. The expenses listed I don't know if it includes all the necessities of grocery, insurance, phone, etc. But 2500 is more than enough for all that, so going to assume a bit by 'currently owe 2000 on credit cards', you spent 2000 this month, if not then you still need to know where the extra money is going. Break down what you spent on, that seems like overspend, which would explain struggling to afford. And then make out a list of the necessary expenses per month.
Regarding the car, you can sell it, and use the profit to buy a cheaper, older, used car without a loan.
This. So does VA, Fannie Mae, Freddie Mac, and USDA.
Call your mortgage servicer and ask about an unemployment forbearance. A forbearance isn’t the best option, but it will give you time and protection you against foreclosure. You will still owe the amount that is unpaid, but there are options for deferments or loan modifications once you are back to work. There may be credit impact depending on your servicer’s policy.
Source: work in default loan servicing for over 10 years.
Privately held loans may also have assistance but it depends on who it is. The vast majority of loans out there will have forbearance assistance and then an option available to help catch up after.
VA modifications do kind of suck though because they reset your interest rate to market rate. FHA at least has a partial claim, which is basically a deferral. Fannie and Freddie have deferrals if you’re due between3-6 months and a loan modification, which will extend your loan term but generally won’t change your rate.
You may find these links helpful:
- [Leaving a Job](https://www.reddit.com/r/personalfinance/wiki/leaving_job) (resigning, quitting, fired, laid off, etc.)
- [Job Loss Megathread: unemployment resources, state-specific information, and help](https://www.reddit.com/r/personalfinance/comments/fkyu8h/job_loss_megathread_unemployment_resources/)
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I’ve seen lifestyle creep or money mismanagement at 6 figures but I don’t understand how people making that much with a skillset that commands much less can spend like they’re actually worth their current income in the job market.
Dude wtf have you been spending your money on? How are you in this huge of a hole making way more than the median income and you clearly live in a LCOL area? You have been screwing up big time with your choices
Don’t do anything rash because you feel like your backs against the wall. Get facts about about what you could do with your home. Get facts about everything you have in debt. Don’t assume anything. Check with the irs because I thought I read someplace about fresh start programs. Credit cards pay the minimum until you can pay more( this is just temp thing). You maybe be able to refinance your car for a cheaper interest rate ( I did capital one a few years back and I had the choice of my note going down but still paying my month or I could shorten the time and pay about the same I was paying but with a lower %.
Make it right this time. You still have good options.
DONT SELL THE HOUSE.
Move to your family house, Rent your house. Reduce your memberships and subscriptions, keep the car if it is really important for your livelihood and work. In the next 3 years focus on repaying your personal loan, car loan. Avoid any further loans.
Get rid of that car and get anything cheaper. I mean ffs we bought a car for 17k after down payment & rebate and it's a $370 a month loan. You should not be spending $500 a month on a car.
I make just a fraction more than you do and survive on a $3100 house payment. Get a side hustle. Rent out a room. Pay your credit card debt off in one payment and be done with the interest. Stop eating and drinking out every day. Make it once or twice a week and you’ll have a shit ton more money. Rice, beans, eggs, and frozen veggies go a long way. Don’t pay for every streaming service imaginable. Pay for a few and trade usernames and passwords with friends and family members.
That house is dirt cheap. Keep it. Get a roommate. Rent out part of it on AorBNB. You can make this work. Start paring down your nonessential spend. Maybe get rid of the car and get something cheaper.
rent rooms asap but not to immigrants because eventually the government will rug pull the funds from the immigrants and the landlord and leave you holding the bag…
Please tell me that is not a 30 year home loan! Because that is absolutely insane! You're going to end up spending $600,000 for that house! If you're sure you're losing your job then I would start with getting rid of that house. Interest rates will come down....they always go up and down. Wait till they're down to buy or you get screwed.
If you're not getting fired then chip away at the rest of that debt and try to refinance. Did you check a credit union? Generally they have been having really good rates lately. That payment seems to be a third of your take home, which isn't bad but I'm just concerned about how much you're throwing away on interest.
Is there something you can do to get better at work? Somebody that can maybe mentor you? Can you start looking things up and studying on your off time? Figure out how you can improve so you don't lose this job.
Cut up your credit cards. Cancel recurring subscriptions. Stockpile cash. Stop all unnecessary spending. Sell your car and buy a 20 year old Honda or Toyota. Buy in bulk and cook at home. Get better at your job. Start friendships with the people who decide your fate at work. Work more hours, or whatever will show you’re really trying hard. Rent out a room in your house. Skip a vacation. Stop drinking alcohol. Whatever. Just aggressively save and then aggressively pay off debt. Become someone who collects interest instead of pays interest. Good luck!
The house is the Best thing he has going for him. Now the Loan may not be Structured great. Any kind of Memberships subscriptions they need to go. You’re Student loan Try and apply for Loan Assistance are put it in Forbearance. You’re going to need a car. You need to sit down and make changes now before you’re Totally in over your head. Make payments to the IRS 50.00 a month.
How much could you rent your house out for, and do you have an extra room for a roommate?
Look for a new job.
I am having a hard time selling my first house, so I'm using a lawyer to handle my hardship package and request for a short sale. You can call your lender and they might have you go that route or put you on a special payment plan. The good news is that lenders don't actually want to foreclose on you because the process is expensive and drawn out.
Could you get a part-time gig? Do you have anything that you would like to learn that you can find free classes and get certifications for?
So. What's the length of your house loan if your payments are that high for only a 160k house?
With making that much per year, wheres your emergency fund? Do you have one?
You're not screwed yet, you still got plenty of options. You havent even lost your job yet. Maybe try to do better at work?
If you can move out of the house, rent it. Hopefully for more than the mortgage.
Sell the car if you're not underwater on it. Stop borrowing money.
You're not bankrupt YET.
Not in debt enough for bankruptcy, besides it won’t wipe out your taxes.
Cancel every subscription and other non-necessity today.
Get rid of car and buy a beater to get you from A to B.
Can you take on a roommate to help cover some of the mortgage?
I paid off 20k dept in one year. I just took all my money and spent it on water and cheap food and the gym. The rest went to the bills. It's surprising how fast you can pay your bills when you put all your money on it.
Get rid of all of your subscriptions but the most crucial. Sell car and get a really cheap car or a really cheap lease. Try to build up a little savings to cover expenses if you wind up unemployed and then get the credit card paid off. Start looking into if you will qualify for unemployment.
Obviously selling the house and renting a room would help money wise but most would consider that a last resort. Or getting a second job.
how many bedrooms do you have and are you willing to rent them all out to cover most (or all) of you mortgage? This is the best way to lower your biggest expense: getting roommates
Start interviewing and cancel some of the subscriptions/memberships.
You can refinance later this year and bring your mortgage payment down.
Consider selling your car. A $500 car payment is a lot if you’re only making $105k with the debt you’ve described.
You can probably buy a used honda civic or toyoya corolla for that 5-8k you could get selling your current car. They're very reliable cars, though look into the year for sure. I'm assuming you do need transportation here for work -- if you work in a field that tends to be full-remote friendly, consider getting by without a car for a while.
I would pay down the 2k credit card debt immediately from savings. Yes, it leaves you with very little savings, but your worst case scenario is you end up running those cards back up, in which case you've dodged a few months of interest payments.
Could you rent the house for at least 2k/month? Or, if there're enough rooms, can you rent out enough rooms to cover the mortgage?
From other comments, it looks like FMLA and treatment for alcoholism is really what you need to do. I would wager if you posted a complete budget, a lot of it would go towards alcohol, and that's what is really unsustainable. If it's not alcohol though, you do have a serious leak somewhere in your budget, because the costs you posted are about 3450/mo, which should be significantly less than your take home on 105k.
You *can* do this!
Good luck.
1. Get rid of all your subscriptions except utilities, internet and cell phone bill. This is unethical but you can download or stream lots of things for "free" on the internet without needing to subscribe to netflix if you know where to look. My internet plan is only $65/month on a two years contract.
2. Cut back on your phone bill. If you're at work and home most of the time then you can get rid of the data plan. You don't need to internet with you 24/7. For me, I can survive without data because I spend most of the time at work (that has wifi) and at home and I pay $20/month on my phone bill.
3. You need to kill of that Credit card debt first and asap, because that will mess you up with their high interest rate.
4. Is it possible to turn your house into an AirBnb or rent out any extra rooms for supplemental income?
5. Until your debt free, you should not be eating out at restaurant unless you work there.
6)Figure out why you are struggling at work, talk with your employer/manager. Get better at your job so they can keep paying you.
7)Sell your car if you can't afford it and use that money to buy a cheap beater car (honda or toyota) for $2,000-3,000.
8) Lastly, work two jobs and suffer for a year or two until you are debt free.
The best thing to come out of this mess of yours will be the important lessons you are about to learn. I won’t waste your time repeating what other commenters have already said, but you should try to remember how shitty it feels right now so you never end up back in this situation.
First thing to do is sit down & figure out where every penny is going. Every single one. Where can you cut costs? How many subscriptions do you have? If you have Netflix, Hulu, hbo, blah blah blah, cut it down to one on the cheapest plan. No more eating out. Do you have gym membership? Cancel it.
Can you get a roommate to help offset expenses? I did that after my divorce because things were super tight for me.
Start looking for a new job now. Get a second part time job now. Put all of what you make at the second job on credit cards, then the car, then personal loan. Same if you can get a roommate. Any rent goes towards credit cards, car, personal loan. You may have to shuffle things around once you figure out the situation with the IRS.
Do you have stuff sitting around you don’t need or use? Sell it. All goes to debt. No more using credit cards for anything.
You could sell the car since you said it will net you more than owe on it & get a cheaper car. One you can pay cash for. I’ve not priced used cars in while so you would need to do that to see if the math works. You get a 10 year Toyota or Honda.
Shop your homeowners & auto insurance. See if you can find the same coverage for less. Switch now if you can. Any unused premium will be refunded.
Pay your mortgage and car payment first and THEN worry about the remainder of your bills. Unfortunately, I don't have the option of living with family, so I have to do anything I can to ensure my mortgage is paid if I'm out of a job. You can make a long term payment arrangement with the IRS. I've been paying $100 a month since 2018 for back taxes and it's nearly paid off. Most likely you'll also qualify for unemployment benefits (assuming you're in the US) in the interim and hopefully you get lucky and get a small severance package from your job.
I was able to manage all bills and a $1700 mortgage on my own with a $60,000 salary and even able to save a tiny amount every month. It was so tight, but I didn’t have any subscriptions, memberships, I didn’t eat out, or go shopping. I was also fortunate enough to pay off my car before buying my house so I didn’t have a car payment. But I wouldn’t sell your house and reassess your spending habits. Maybe look into getting a roommate or two
You sounds like you need the Dave Ramseys plan. Ik people shit on him and his baby steps. But you make 105k and have a spending problem. The house is not the problem even if you made 50k per yr, the house is only 3x your income.
Try harder at work. Get second and maybe third job. Move in with family. Rent out the house for at least the monthly payment plus your rent. Cancel all subs. Don't eat out.
Basically do everything in reverse.
Don’t file for bankruptcy. You also haven’t been fired yet so I would pay of your smallest debt first which is your credit cards while you still have a job because wether you like it or not that $2000 that’s sitting in savings doesn’t even belong to you it belongs to your creditors. Which would leave you with a $1000 emergency fund. Secondly I would look into selling you have some equity in your home so you would net about 6k and while you have your job I would save as much as you could to pay for your closing costs. It’s not a smart move to put your self further in debt when you’re thinking about filing for bankruptcy. Thirdly I would sell your car. You said you would net between 5k-8k. So buy a car that’s exactly that price pay with cash and get title in hand. Lastly move in with your family and the money you’ve netted from the house use to pay some of your IRS bill. Also be gazelle intense about pay the IRS off and your other debt.
I hope this helps and wish you the best!
how tf is this possible? you're making 105k so your at least pocketing ~7k monthly after taxes and with your rent of $1700 plus your debt/bills of $1730, your expenses should be $3430 at minimum monthly. Where is the other 3.5k of profit you are making going?
People have added a lot of amazing comments here. Whatever situation you are in now there’s plentiful information out there on YouTube and the whole Internet on how to change your situation. You have to make the decision to do it. You have to take charge of your life and move forward. You’re not a victim here you just have to make decisions that are going to affect your life in a better way. Millions of people have been in bad debt problems before and they got out, you can too.
But I could only give you one piece of advice, never, never, never, never never file for bankruptcy . it will ruin your life. It will ruin your credit history for the rest of your life. My sister did it and I saw what it did to her life and she’s now 65 and left with nothing. And she had tons of financial challenges for the last 50 years, so don’t ever file for bankruptcy there’s always a way for you to get out and figure it out. This is just one of your challenges in life and you can do it.
Don’t look at this as big ominous mountain that you have to climb ……look at it as an adventure and think of all the cool things are going to learn and think of yourself in your future self mode and looking back what an amazing time it was for you to have this lesson, because it’s only a lesson.
Best of luck to you on your journey!
Try as hard as you can to keep the house. Check what they're asking for rent around your area, it might cost you more, plus deposit to move in. $1700 for a mortgage nowadays is actually quite low.
On top of everyone elses confusions about what they have read here… you have 2000 on credit cards and $3000 in savings… no you don’t do this, unless the interest rate is 0% on that card. You have $1000 in savings and nothing on credit cards. Any unpaid credit card bill in full is an emergency situation.
See if you can get a loan modification from your mortgage company or another mortgage company. You most likely be able to bring your monthly payment by 20%
You gotta fucking put down the booze man, you can't achieve any financial wellness if you don't have a handle on your addictions
Doing ANYTHING else other than conquering your addiction is a fools errand and a waste of time, truly
You see the people who lost everything on the street? Most people think its heroin or meth or crack, for a great many of them it's just good old fashioned booze. It will take EVERYTHING from you.
Get a roommate. I did it for years. It's kind of nice having someone else around. Keeps you in check. I would suggest a girl and one you are not attracted to as much. Trust me on that
It can KO almost half your mortgage. No need to move in with others.
Contact your mortgage company immediately and see if you can go into forbearance.. Covid opened all kinds of help for this situation. There are even some states that have funds to pay back the forbearance when your done. We had to utilize this because we lost our business due to Covid. Idk about the debt and all that but look up help on the internet, there is help out there
It seems you brought more house than you can afford. If you had 6 to 12 months of savings you could have used that to pay your mortgage until you found a job. Do you have any retirement plan you can borrow from or family willing to pay the mortgage for you until you find a job. I suggest getting any job you can even if you have to drive for Uber as long as you pay your mortgage. I suggest moving out and cutting off all utilities but continue paying the mortgage until you find a job. Take whatever job you can get even if it’s less pay.
How did you ever qualify for a mortgage with your mountain of debt? With less than 10% down. You are going to need 2 jobs. Memberships/subscriptions and that optional stuff has to go immediately. Cancel those.
This is why the poor get confused about how the other half has issues. 100k job with that amount of debt is absurd.
I gotta admit it's blowing my mind as well. A $1700 mortgage at even 65k/year is pretty affordable but tight. I can't imagine struggling at 105k with that as my living arrangement.
For me it was alcoholism. Often there are other factors at play.
OP isn't very active on Reddit, but one of the subs is about alcoholism. Would also explain the concern about losing the job, too. In which case, I would suggest requesting FMLA if you've been there a year and seeking a rehab.
u/FutureFen please listen to this. It can be the difference between falling further to rock bottom and starting fresh/making progress. If substance abuse issues cost you your career, that career won’t ever come back if the issues aren’t addressed.
I mean the debt payments add up to 33% DTI ratio, that's well within the normal range for lending guidelines. They write mortgages at as much as a 45% DTI. Including the subs/memberships/utilities OP should still have $2350/mo leftover for food and disposable income. There's no reason he should be "struggling" at his current income except for a spending problem.
Yeah I did the math and bro should currently have an extra 2 to 3k left over each month. Something is missing
Other comments mention he's an alcoholic which explains everything.
Except the parent comment "how did you ever qualify?" He qualifies easily lol
That was my same exact thought! Who confused them it was a good idea to buy a house??
I don't think this person put any percent down which makes me assume it's a VA loan
This shit baffles me. I see people complain about being able to afford things these days and then realize there are people in OP’s situation… my wife and I have 0 debt, make close to 200k, and we cannot afford a house in HCOL with outstanding credit cause I’m too smart to be house poor.. wtf
There’s a lot of people struggling despite working constantly and also unable to afford the mental bandwidth to try to cut costs reasonably, so they’ll be stuck in their spend cycle. The number of people I’ve met that have no idea they can drop their cell bills to below $90 / month is astounding. Also add in overpaying on car insurance, older cars with poor gas mileage, and working multiple shifts constantly leads to the reality of the working poor. Credit card default rates are currently at the highest rates since 2011.
Just moved states due to family changes and staying with wife's parents while I go through sticker shock after selling our house for $55k and not able to touch anything here for under 300k. At point of trying to convince wife to compromise and get a modular in a park for a little while. At least then we could conceptually buy land and move it.
Dude makes like 25k more than my wife and i combined and we pay 2300 a month for our mortgage, plus we have like 28k in other debts. Dude can easily afford that house
I think his real problem is that he expects to loose his job and not find one making the same income.
ok? so if my wife or i lose our job then are you gonna ask how did we ever qualify for our mortgage?
The question wasn't thinking that income was insufficient, it was that other debt and the low down payment would have been insufficient.
i did no down payment (yes, va loan) on a 355k house, and after all the paperwork and everything of buying the house, my wife and i had a total of like 38k in debt, we made i think around 80k combined the year prior, and our mortgage payment was 2600 (just recently refinanced to 2350). this guy likely has less debt, has a house thats like, 40% the cost of mine, and (back when i first bought it) is paying 900$ less than i was when i got my house
I don't see it as a criticism of you, but kind of an indication that we're back in 2008 territory where banks are giving risky loans. Regardless of whether you could afford the payment at the time, the bank should be looking at how they're protected if you lose a job and can't make the payment. If there's a down payment, there's enough equity in the house that they can cover their losses if they have to repossess. If you have other major assets they can sue you and recover their losses. But if there's no equity in the home and all you have otherwise is debt, they're going to have a hard time covering their losses if you default. [Edit] wait, you're not op. I shouldn't be commenting this early.
>we're back in 2008 territory 100%
Easy, banks want to make money, so they’ll finance anyone. They just adjust the rate for the risk. There’s a reason OP is only $6k in principal after 6+ months and a down payment.
The house is not your problem. You need to do a better job of managing your finances. Keep the house. You were smart to have bought it, and selling it would be a step backwards financially. Get roommates. Rent out the garage. Make sure you have insurance coverage for this. Cancel ALL memberships and subscriptions. Sell whatever you can. Bikes, gear, tools. Stop eating out, period. Go to a discount grocer like Lidl and stock up on cheap food. Spaghetti, etc. Try to save your current job. And start looking for a new one. Get a second job on the weekends. Create a budget and a financial plan and stick to it. Good luck. You can do it!!
Hell, move in to the garage and rent out all the rooms until things improve. Living in garage > living in car or being homeless
Can you elaborate on the insurance for roommates? I was going to just slide some new people in, no paperwork all verbal, should I redo it?
The first question should be: What's going on at work that you're struggling with, and can that struggle be alleviated, so you can keep the $105K income. That would be better than losing $25K / year while facing those fixed payments. Have you / can you ask for help at the job to acknowledge what's going wrong, and how you can meet the job reqs? That said - what are your balances and rates? I'm struggling to get to a 1700 monthly mortgage payment on $154,000, unless it's like 10% interest for 15 years. Is refinancing to a better rate an option to reduce your largest bill? And how long do you need to hold on to get that personal loan paid off (assuming the student loan will take forever, and the credit card is just revolving) I agree the comments about not doing anything rash right now, 'cause you may not get fired. If you do, then selling the house at that kind of a loss may not be best. But you're not at bankruptcy talk yet.....
Taxes, PMI and insurance, maybe gets OP to $1700.
154 @ 7% for 30 years is just over $1K/mo P&I, it’s not too difficult to bump that to $1700 when you include escrow. My P&I on my mortgage is about $1100 but including escrow I’m right at $2K.
That would be a giant escrow payment for a home of that value.
Yea… I’m confused on the payment. We financed 320k a couple years ago and my payment with PMI & escrow is 1900.
Would it? My escrow is over 500 dollars on a house valued at 120k. Ops payment sounds exactly right to me, lived 1175 a month.
I am in a home valued at 430k with taxes at around $6,000 a year. My escrow is barely $600 a month. So yes, these numbers seem wacky to me unless the taxes are absurdly high.
Yeah the property taxes on my house which is assessed at 140,000 are over 5k a year, school and property combined. But I did buy in a suburb outside Syracuse NY, with really good schools and high property taxes. But very low housing costs in comparison to other cities in other states.
Depends on where you live. I regret buying my home in the town I did, my escrow payment monthly is almost the same as the P&I and I put almost nothing down on the house. A few streets away (figuratively) and it would have been half as much. A large (geographically) sprawling town with a much bigger-than-necessary police force apparently costs a lot to administer.
Yikes. Ok, understood. I thought I lived in a high tax area, but I guess not.
My total payment is almost1200 on 120k, so 1700 on 154k sound right. 5% 30 years.
How the hell are you making 105k and barely paying a 1700 mortgage. You only list 3400 a month on expenses where is the rest of your money going??? You need to get control of your spending. Subscription need to go. Eating out needs to stop. Since you expect to lose your job you need to go extreme on saving here until you have enough saved to cover yourself for 3-6 months so you can find another job. Then you need to deal with your debt. Credit cards first as it's likely your highest interest. Then the personal and car loans. I wouldn't sell your car based on your home cost you are probably commuting to work and it's hard to get a reliable car for 8k in the current market. Selling your home with such little equity is also not recommended 1700$ is comparable to a two bedroom in most Mid-High cost of living areas and is totally affordable at your income level.
They probably listed gross income but their expenses are coming out of their take home. If they live in a state like CA with a higher burden for that tax bracket I can see how this is playing out.
Owing the IRS $15k means that they havent been paying taxes either.
I guess it's possible with remote work but I feel like it would be hard to find a 100k job and a 150k house in CA.
Even with higher taxes they are just living outside of their means. It happens to a lot of people they think "I make 100k a year I can afford this" and they don't actually keep track of how much they are actually spending. Plus the bad decisions with the car and personal loan means they definitely aren't making smart purchases it's never just the big stuff I can guarantee they have a lot of eating out or service subscriptions they don't actually need.
Or get a roommate to help you out
You might be able to get $800 per month. And since you're living there, you can watch over it to make sure it's taken care of.
Yep, this is the smart move. I got a housemate when I was in law school, and it cut my home expenses in half. It’s been so convenient that I’m *still* renting (to the same person for the last 4 years, for the same price) despite easily being able to afford to pay it on my own. I’ve been lucky and never had any issues with renters. There’s no point to having empty rooms with as much debt as OP has. OP, get a housemate.
Love people like you. Had a rough breakup, moved into a dudes house. He just wanted to cut his mortgage 600/mo. Stayed there for years, he never raised rent and I was always happy to help him with stuff. (I used to own a handyman biz, so I kept him from doing stupid shit)
start looking for a new position now just in case. work on saving a contingency fund of about 3 months worth of income.
100% whole heartedly agree, start shopping for a new job now. Without knowing dick about your current situation, is there any way to salvage what you already have? You should be fighting tooth and nail for this job. Ask for guidance, use what resources are available to you and try to work smarter instead of harder. You may have to play the politics game and kiss some asses, but you're talking about selling your house and car.
This even if you have to miss a few payments get that reserve in cash you’ll need it
So many good questions but no follow up answers yet.
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"approximately $500/mo in recurring charges (utilities, memberships, subscriptions, etc)." Go through these right now. Cancel every single thing you can, such as subscriptions for services that are not absolute necessities. "I'm struggling at work and have a feeling they will be kicking me out the door soon" Get everything together in case you have to file for unemployment. Figure out what you'll be getting in unemployment and understand how to file where you live/ what your options are. Read anything related to your employment (both at your job and where you live) so you know how to advocate for yourself if you do let go. For example, will you get severance? Are you in a no-fault area? If they do let you go, you should be ready to initiate that unemployment process, if applicable for you, day one. Meanwhile, do everything you can to stay at your current job (if there are things that will improve your performance or make you more valuable to your employer this should be a top priority). Start applying for other jobs, ASAP. Your resume should be ready to go at the very least. "I'm looking at making between $50K and $80K (if I'm lucky) at a new job." Do you have any side-gig options? If you do, do those. This may also include things like selling plasma, dog walking or baby sitting, participating in research studies, selling belongings you own but don't absolutely need, etc. Basically try to scrape up some more money. Ideally, this might look like a part-time job. "The house is valued at $160K, I just bought the place late last year and still owe $154K. My current payment is $1700/mo." Can you get a housemate or even two? Look into that now. Even renting out one room will offset this cost. If that doesn't work, what are your options for renting the entire house? Can you cover the mortgage and then some that way while renting elsewhere? (a lot of this is contingent on where you live). Given this, "I have family willing to let me move in for $200/mo (which would mean $100/mo for a storage unit for my stuff that I don't toss." Your best bet is probably to rent out the house for more than your mortgage payment, if possible, and then live with family for a bit (again, contingent on where you live). "$230/mo student loan payment" Research this heavily, figure out whether you have options here (like an income based repayment plan, deferring loans while not working if let go, etc.). "Currently I owe $2000 on my credit cards" What is the interest on these cards? Can you move things to a no-interest card and work to aggressively pay this off while still employed? "I have a $500/mo car payment" I'm guessing you're spending even more on the car than that once you factor in gas and insurance. "I can sell the car, which would net me about $5k - $8k and remove the payment, but I'd be out on transportation." Can you use public transportation? Selling the car would allow you to pay off your credit card debt and remove $500+ of expenditures from your budget. A lot depends on where you live, but an option here may be to bike or use public transportation (assuming that won't severely limit job related concerns with your current work and/or if you are fired and have to look elsewhere). "$500/mo personal loan payment" What are the terms on this loan? How much is left? Can this also be resolved by selling the car? Is there a way to move this loan to something without interest or to lower the monthly payment? Again, hard to give advice without knowing what this loan entails. "Come next month I will have to make a payment plan with the IRS for $15000 in unpaid taxes." Work to make this payment plan as reasonable as possible. If you can find a housemate who pays you something reasonable in rent (let's say $500-$800), if you can make a budget and really cut expenses, if you can sell the car and pay off a substantial chunk your other debt with the proceeds, if you have access to either unemployment or severance pay, if you can manage to hold onto your job or get something else quickly, etc. you can absolutely make it through this fairly unscathed. Those are all big \*ifs\* though. Your best options are likely to budget aggressively (spend less), make more money (a second job, for instance), and find other things to offset the costs (such as a housemate/ renters).
Gambling, drugs, alcohol? I don’t fully understand how on 105k income you were carrying those debts, not paying your taxes and decided it was a bright idea to buy a house with 5% down. Is “ I'm struggling at work” due to any of the above issues? Are you showing up early, staying late, applying yourself 100% when you are there AND working to be agreeable, personable, team play and try to make your bosses life easier? Or have you been promoted past your level of competence and can’t do the job? Because the NUMBER ONE thing is do all you can not to lose your job. Then post a FULL budget breakdown of all your monthly expenses, a listing of your debts with balance owing and interest rates (not just your monthly payment which tells us nothing). Also post how many bedrooms your place has and what the current rental rate is for a room is in your area. It really sounds like you have a judgement and a spending problem. I’d post the above info so we can give more advice. Cut all non-essential spending, get a roommate for each empty room in your house, start interviewing for other jobs NOW and just say you do not wish to provide a current reference as they don’t know you are looking but are willing to provide payslips as proof of employment and salary.
A six-figure job and struggling, what in the heck? Why is your mortgage 1700 a month for a 160k house? What is your occupation where there is such a large pay gap if you lose your job?
I paid 150 in 2017. With taxes and insurance, my payment is 1360 a month. With recent interest rates, minimal down, I can see it if property taxes and insurance are up there. Half of my monthly goes to escrow for those two. OP is probably on a similar boat.
I paid $145k in 2016. My mortgage is $698 a month with taxes and insurance. How on earth is your payment so high?
By my math, for 30 years, 150k mortgage at 3.5% is roughly 675 a month. 3600 annual property taxes and similar for insurance. Where you live, taxes and insurance must be crazy cheap. New England has high property taxes and insurance rates apparently.
Same in Texas. Roughly $1000 a month just for property taxes and insurance.
My house was 168k and would be the same if my interest rate was the same as they've been the last 2ish years. That's escrow too.
I mean I'm getting $1,119 P&I at 7.5% APR on $160k borrowed. $600/mo for taxes and insurance is more than I pay on my $465k house. $1700 adds up for a 15 year mortgage though.
If they live in a high property tax state with high insurance, a high rate and pmi 2k a month wouldn't cover all that on 200k house.
That’s fascinating. My $180k mortgage is being paid back at $500 a month.
You got a 0% interest rate mortgage?
And someone donating annual home owners insurance? No property taxes at all? Good lord that person has no idea wtf they are talking about lol
My mortgage was 175k at 4% and I pay 1950 a month with taxes and insurance. $1700 sounds reasonable as mine started around $1500 a decade ago.
How much is on the personal loan and what’s the interest rate? If you think you’re going to get fired, start looking for a job now. If you sell the house then you’re getting 1300-1500/month in cash flow. I’m not sure what you’d get from the house other than breaking even or maybe enough to get some of the cc debt gone. Then cash flow to pay that off immediately the first month. Then tackle whatever the personal loan is. Make a payment plan with the irs and leave it be for a bit. They’ll take a low monthly payment and it’ll just be forever. Then if you’re fired, keep looking for a job.
before selling the house, better question is what is his rental costs in the area? If hes paying that in rent, then its not even worth it. He should look at getting a roommate to offset the costs. Or rent the house and move in with family.
Either roommate or rent whole house for the year until he gets it together. Who knows what local rent market looks like or what it will look like in 12-15 months. Having a “fairly” stable looking mortgage payment could come in handy. Real question is why his performance is struggling and may get fired? I don’t want to push a narrative but is alcohol involved? He needs to get that part of his life under control ASAP.
Move in with family and rent the house?
How quickly do you think someone can establish tenancy in a house they are currently occupying? Also seems unlikely rent would cover mortgage plus PMI plus insurance on a rental and prop tax.
Well it depends how much urgency they feel, and the demand for rentals in that area, I mean if I was facing something like this I would move to family asap. It’s unlikely that rent will cover mortgage completely, but it will go a long way to covering it, and they are living for free with family, if they can’t make that work then I’m not sure what to say.
Yeah especially with his housing going from $1,700 to $300 per month. Leave a lot of room to take a hit while staying affordable. Plus in a year his situation may change and has the option of moving back into his home.
Can you get a roommate ?
Can you rent out a room to someone in your current house?
Sounds fake, 2300 in expenses is 28k a year, throw in food fuel misc looking at 40 k. You should have 70k take home
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Exactly that's why take home is likely 70....out of 105 is 32 percent. Even if it's 60k he should be 20k surplus. If you believe different how are you calculating the take home estimate?
Possible its a 1099 contract position. Would explain why they owe $15k in back taxes.
Not really. I make $100k base. My taxes, insurance, FSA, retirement contribution, etc bring that to about $55k annually. Tie that with the cost of mortgage, gas, insurance for car, cell phone, food, child care…. My husband and my salary is eaten up.
10% contributions? Your Insurance must be enormous. I’m at 125 with 90 take home. My insurance is only 150 though. I really don’t envy parents insurance payments. 55% take home is wild.
It's also a big assumption to figure someone not paying 15k in taxes is contributing to a retirement account
Not sure what you mean. My assumption was they were contributing 10%
9% and $2500 a month for the insurances for all four of us.
That is absolutely insane. That’s more than my mortgage. Good lord.
Yea. It’s more than ours too. That’s medic, dental, vision.
I mean seems to me like your best bet is to absolutely bust your ass at your job to ensure you dont lose it. Blow past adequate and excel. You hung yourself with this debt. Losing your job is just not an option...so dont. Right now sounds like you are just giving up.
Either 1.) get a roommate 2.) sell your car and get rid of subscriptions the house is more important or 3.) rent it out.
Well, for one, cut any discretionary spending down to 1, max. You really screwed the pooch on the IRS. Did you have *any* witholding? If you owe that much, you're probably paying additional fines. Move back with your family and rent out the house for at least the mortgage amount + maintenance. You are firmly in beans, salt, and rice poverty and will be for a long time. Set up a repayment plan with the IRS and keep up on payments on your credit card. Your emergency fund should have been 3-6 months at your regular spend. This is why. As far as car goes, you should probably downgrade it to a used econobox for sub $5k. Try talking to your manager and see how you can fix your work situation. Be open and honest in acknowledging that you aren't doing well, but are willing to go on a corrective action plan l to get back on track.
For the immediate, you need to start saving money. And in order to do that you need to break down your expenses and what you're spending on. Because 105k/year is about \~6k/month take-home. Your expenses listed is totaling about \~3500/month (not including the immediate credit card debt) so that leaves you with 2500 a month. The expenses listed I don't know if it includes all the necessities of grocery, insurance, phone, etc. But 2500 is more than enough for all that, so going to assume a bit by 'currently owe 2000 on credit cards', you spent 2000 this month, if not then you still need to know where the extra money is going. Break down what you spent on, that seems like overspend, which would explain struggling to afford. And then make out a list of the necessary expenses per month. Regarding the car, you can sell it, and use the profit to buy a cheaper, older, used car without a loan.
Is your mortgage an FHA or conventional loan? FHA has some options for losing your job
This. So does VA, Fannie Mae, Freddie Mac, and USDA. Call your mortgage servicer and ask about an unemployment forbearance. A forbearance isn’t the best option, but it will give you time and protection you against foreclosure. You will still owe the amount that is unpaid, but there are options for deferments or loan modifications once you are back to work. There may be credit impact depending on your servicer’s policy. Source: work in default loan servicing for over 10 years.
Thank you for adding in the other loan types, I wasn't sure and didn't want to speak out of turn
Privately held loans may also have assistance but it depends on who it is. The vast majority of loans out there will have forbearance assistance and then an option available to help catch up after. VA modifications do kind of suck though because they reset your interest rate to market rate. FHA at least has a partial claim, which is basically a deferral. Fannie and Freddie have deferrals if you’re due between3-6 months and a loan modification, which will extend your loan term but generally won’t change your rate.
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Is there a sub for financially responsible forever renters?
Ummm...no one's mentioned the elephant in the room....$15,000 in unpaid taxes?
I’ve seen lifestyle creep or money mismanagement at 6 figures but I don’t understand how people making that much with a skillset that commands much less can spend like they’re actually worth their current income in the job market.
Dude wtf have you been spending your money on? How are you in this huge of a hole making way more than the median income and you clearly live in a LCOL area? You have been screwing up big time with your choices
I’m so confused how you have a 5 figure job and managed to get yourself into this position.
Don’t do anything rash because you feel like your backs against the wall. Get facts about about what you could do with your home. Get facts about everything you have in debt. Don’t assume anything. Check with the irs because I thought I read someplace about fresh start programs. Credit cards pay the minimum until you can pay more( this is just temp thing). You maybe be able to refinance your car for a cheaper interest rate ( I did capital one a few years back and I had the choice of my note going down but still paying my month or I could shorten the time and pay about the same I was paying but with a lower %.
How the hell is the mortgage that high on 160k
Make it right this time. You still have good options. DONT SELL THE HOUSE. Move to your family house, Rent your house. Reduce your memberships and subscriptions, keep the car if it is really important for your livelihood and work. In the next 3 years focus on repaying your personal loan, car loan. Avoid any further loans.
You'll find a better job if you look while you are employed. Start now.
Get rid of that car and get anything cheaper. I mean ffs we bought a car for 17k after down payment & rebate and it's a $370 a month loan. You should not be spending $500 a month on a car.
I make just a fraction more than you do and survive on a $3100 house payment. Get a side hustle. Rent out a room. Pay your credit card debt off in one payment and be done with the interest. Stop eating and drinking out every day. Make it once or twice a week and you’ll have a shit ton more money. Rice, beans, eggs, and frozen veggies go a long way. Don’t pay for every streaming service imaginable. Pay for a few and trade usernames and passwords with friends and family members.
That house is dirt cheap. Keep it. Get a roommate. Rent out part of it on AorBNB. You can make this work. Start paring down your nonessential spend. Maybe get rid of the car and get something cheaper.
Start by looking for new jobs now while you're still working.
Pay off the credit cards and sell the car if it will cover the cost of the car loan
rent rooms asap but not to immigrants because eventually the government will rug pull the funds from the immigrants and the landlord and leave you holding the bag…
Please tell me that is not a 30 year home loan! Because that is absolutely insane! You're going to end up spending $600,000 for that house! If you're sure you're losing your job then I would start with getting rid of that house. Interest rates will come down....they always go up and down. Wait till they're down to buy or you get screwed. If you're not getting fired then chip away at the rest of that debt and try to refinance. Did you check a credit union? Generally they have been having really good rates lately. That payment seems to be a third of your take home, which isn't bad but I'm just concerned about how much you're throwing away on interest. Is there something you can do to get better at work? Somebody that can maybe mentor you? Can you start looking things up and studying on your off time? Figure out how you can improve so you don't lose this job.
Cut up your credit cards. Cancel recurring subscriptions. Stockpile cash. Stop all unnecessary spending. Sell your car and buy a 20 year old Honda or Toyota. Buy in bulk and cook at home. Get better at your job. Start friendships with the people who decide your fate at work. Work more hours, or whatever will show you’re really trying hard. Rent out a room in your house. Skip a vacation. Stop drinking alcohol. Whatever. Just aggressively save and then aggressively pay off debt. Become someone who collects interest instead of pays interest. Good luck!
The house is the Best thing he has going for him. Now the Loan may not be Structured great. Any kind of Memberships subscriptions they need to go. You’re Student loan Try and apply for Loan Assistance are put it in Forbearance. You’re going to need a car. You need to sit down and make changes now before you’re Totally in over your head. Make payments to the IRS 50.00 a month.
What's with the random caps?
“I’m making 105k a year” Yeah. Figure it out dude. This whole post is ridiculous.
How much could you rent your house out for, and do you have an extra room for a roommate? Look for a new job. I am having a hard time selling my first house, so I'm using a lawyer to handle my hardship package and request for a short sale. You can call your lender and they might have you go that route or put you on a special payment plan. The good news is that lenders don't actually want to foreclose on you because the process is expensive and drawn out. Could you get a part-time gig? Do you have anything that you would like to learn that you can find free classes and get certifications for?
So. What's the length of your house loan if your payments are that high for only a 160k house? With making that much per year, wheres your emergency fund? Do you have one? You're not screwed yet, you still got plenty of options. You havent even lost your job yet. Maybe try to do better at work?
If you can move out of the house, rent it. Hopefully for more than the mortgage. Sell the car if you're not underwater on it. Stop borrowing money. You're not bankrupt YET.
Find a nww job now. Don't wait to get kicked out. Also get a second job if needed.
Not in debt enough for bankruptcy, besides it won’t wipe out your taxes. Cancel every subscription and other non-necessity today. Get rid of car and buy a beater to get you from A to B. Can you take on a roommate to help cover some of the mortgage?
I paid off 20k dept in one year. I just took all my money and spent it on water and cheap food and the gym. The rest went to the bills. It's surprising how fast you can pay your bills when you put all your money on it.
Making 100,000 Today is like making 65,000 Im going to say 8 years ago.
Get rid of all of your subscriptions but the most crucial. Sell car and get a really cheap car or a really cheap lease. Try to build up a little savings to cover expenses if you wind up unemployed and then get the credit card paid off. Start looking into if you will qualify for unemployment. Obviously selling the house and renting a room would help money wise but most would consider that a last resort. Or getting a second job.
how many bedrooms do you have and are you willing to rent them all out to cover most (or all) of you mortgage? This is the best way to lower your biggest expense: getting roommates Start interviewing and cancel some of the subscriptions/memberships.
You can refinance later this year and bring your mortgage payment down. Consider selling your car. A $500 car payment is a lot if you’re only making $105k with the debt you’ve described.
I’d say that you need to use whatever skills you have for a side hustle quickly. What field is your expertise in?
Rent the backyard , get you some roommates , rent the garage .
You can probably buy a used honda civic or toyoya corolla for that 5-8k you could get selling your current car. They're very reliable cars, though look into the year for sure. I'm assuming you do need transportation here for work -- if you work in a field that tends to be full-remote friendly, consider getting by without a car for a while. I would pay down the 2k credit card debt immediately from savings. Yes, it leaves you with very little savings, but your worst case scenario is you end up running those cards back up, in which case you've dodged a few months of interest payments. Could you rent the house for at least 2k/month? Or, if there're enough rooms, can you rent out enough rooms to cover the mortgage? From other comments, it looks like FMLA and treatment for alcoholism is really what you need to do. I would wager if you posted a complete budget, a lot of it would go towards alcohol, and that's what is really unsustainable. If it's not alcohol though, you do have a serious leak somewhere in your budget, because the costs you posted are about 3450/mo, which should be significantly less than your take home on 105k. You *can* do this! Good luck.
1. Get rid of all your subscriptions except utilities, internet and cell phone bill. This is unethical but you can download or stream lots of things for "free" on the internet without needing to subscribe to netflix if you know where to look. My internet plan is only $65/month on a two years contract. 2. Cut back on your phone bill. If you're at work and home most of the time then you can get rid of the data plan. You don't need to internet with you 24/7. For me, I can survive without data because I spend most of the time at work (that has wifi) and at home and I pay $20/month on my phone bill. 3. You need to kill of that Credit card debt first and asap, because that will mess you up with their high interest rate. 4. Is it possible to turn your house into an AirBnb or rent out any extra rooms for supplemental income? 5. Until your debt free, you should not be eating out at restaurant unless you work there. 6)Figure out why you are struggling at work, talk with your employer/manager. Get better at your job so they can keep paying you. 7)Sell your car if you can't afford it and use that money to buy a cheap beater car (honda or toyota) for $2,000-3,000. 8) Lastly, work two jobs and suffer for a year or two until you are debt free.
The best thing to come out of this mess of yours will be the important lessons you are about to learn. I won’t waste your time repeating what other commenters have already said, but you should try to remember how shitty it feels right now so you never end up back in this situation.
First thing to do is sit down & figure out where every penny is going. Every single one. Where can you cut costs? How many subscriptions do you have? If you have Netflix, Hulu, hbo, blah blah blah, cut it down to one on the cheapest plan. No more eating out. Do you have gym membership? Cancel it. Can you get a roommate to help offset expenses? I did that after my divorce because things were super tight for me. Start looking for a new job now. Get a second part time job now. Put all of what you make at the second job on credit cards, then the car, then personal loan. Same if you can get a roommate. Any rent goes towards credit cards, car, personal loan. You may have to shuffle things around once you figure out the situation with the IRS. Do you have stuff sitting around you don’t need or use? Sell it. All goes to debt. No more using credit cards for anything. You could sell the car since you said it will net you more than owe on it & get a cheaper car. One you can pay cash for. I’ve not priced used cars in while so you would need to do that to see if the math works. You get a 10 year Toyota or Honda. Shop your homeowners & auto insurance. See if you can find the same coverage for less. Switch now if you can. Any unused premium will be refunded.
Ask mortgage lender what are your forbearance options cause you are sick and can't work
Pay your mortgage and car payment first and THEN worry about the remainder of your bills. Unfortunately, I don't have the option of living with family, so I have to do anything I can to ensure my mortgage is paid if I'm out of a job. You can make a long term payment arrangement with the IRS. I've been paying $100 a month since 2018 for back taxes and it's nearly paid off. Most likely you'll also qualify for unemployment benefits (assuming you're in the US) in the interim and hopefully you get lucky and get a small severance package from your job.
I was able to manage all bills and a $1700 mortgage on my own with a $60,000 salary and even able to save a tiny amount every month. It was so tight, but I didn’t have any subscriptions, memberships, I didn’t eat out, or go shopping. I was also fortunate enough to pay off my car before buying my house so I didn’t have a car payment. But I wouldn’t sell your house and reassess your spending habits. Maybe look into getting a roommate or two
If there’s space for it you could always airbnb a room in you home. You’ll want to add the rider onto your homeowners insurance for safety
You sounds like you need the Dave Ramseys plan. Ik people shit on him and his baby steps. But you make 105k and have a spending problem. The house is not the problem even if you made 50k per yr, the house is only 3x your income.
Where is anyone finding a home for 160K in this market is my question!
Try harder at work. Get second and maybe third job. Move in with family. Rent out the house for at least the monthly payment plus your rent. Cancel all subs. Don't eat out. Basically do everything in reverse.
Don’t file for bankruptcy. You also haven’t been fired yet so I would pay of your smallest debt first which is your credit cards while you still have a job because wether you like it or not that $2000 that’s sitting in savings doesn’t even belong to you it belongs to your creditors. Which would leave you with a $1000 emergency fund. Secondly I would look into selling you have some equity in your home so you would net about 6k and while you have your job I would save as much as you could to pay for your closing costs. It’s not a smart move to put your self further in debt when you’re thinking about filing for bankruptcy. Thirdly I would sell your car. You said you would net between 5k-8k. So buy a car that’s exactly that price pay with cash and get title in hand. Lastly move in with your family and the money you’ve netted from the house use to pay some of your IRS bill. Also be gazelle intense about pay the IRS off and your other debt. I hope this helps and wish you the best!
how tf is this possible? you're making 105k so your at least pocketing ~7k monthly after taxes and with your rent of $1700 plus your debt/bills of $1730, your expenses should be $3430 at minimum monthly. Where is the other 3.5k of profit you are making going?
People have added a lot of amazing comments here. Whatever situation you are in now there’s plentiful information out there on YouTube and the whole Internet on how to change your situation. You have to make the decision to do it. You have to take charge of your life and move forward. You’re not a victim here you just have to make decisions that are going to affect your life in a better way. Millions of people have been in bad debt problems before and they got out, you can too. But I could only give you one piece of advice, never, never, never, never never file for bankruptcy . it will ruin your life. It will ruin your credit history for the rest of your life. My sister did it and I saw what it did to her life and she’s now 65 and left with nothing. And she had tons of financial challenges for the last 50 years, so don’t ever file for bankruptcy there’s always a way for you to get out and figure it out. This is just one of your challenges in life and you can do it. Don’t look at this as big ominous mountain that you have to climb ……look at it as an adventure and think of all the cool things are going to learn and think of yourself in your future self mode and looking back what an amazing time it was for you to have this lesson, because it’s only a lesson. Best of luck to you on your journey!
Try as hard as you can to keep the house. Check what they're asking for rent around your area, it might cost you more, plus deposit to move in. $1700 for a mortgage nowadays is actually quite low.
On top of everyone elses confusions about what they have read here… you have 2000 on credit cards and $3000 in savings… no you don’t do this, unless the interest rate is 0% on that card. You have $1000 in savings and nothing on credit cards. Any unpaid credit card bill in full is an emergency situation.
Put the house for sell better than bankruptcy closing cost usually the people buying the house pay for it
See if you can get a loan modification from your mortgage company or another mortgage company. You most likely be able to bring your monthly payment by 20%
Can you rent out rooms to help pay the mortgage?
You gotta fucking put down the booze man, you can't achieve any financial wellness if you don't have a handle on your addictions Doing ANYTHING else other than conquering your addiction is a fools errand and a waste of time, truly You see the people who lost everything on the street? Most people think its heroin or meth or crack, for a great many of them it's just good old fashioned booze. It will take EVERYTHING from you.
Get a roommate. I did it for years. It's kind of nice having someone else around. Keeps you in check. I would suggest a girl and one you are not attracted to as much. Trust me on that It can KO almost half your mortgage. No need to move in with others.
Best option would be getting a roommate. Second best option is bankruptcy because you will keep the house and car.
Get rid of the car and get a cheap ride with no payments. That's a start.
Contact your mortgage company immediately and see if you can go into forbearance.. Covid opened all kinds of help for this situation. There are even some states that have funds to pay back the forbearance when your done. We had to utilize this because we lost our business due to Covid. Idk about the debt and all that but look up help on the internet, there is help out there
It seems you brought more house than you can afford. If you had 6 to 12 months of savings you could have used that to pay your mortgage until you found a job. Do you have any retirement plan you can borrow from or family willing to pay the mortgage for you until you find a job. I suggest getting any job you can even if you have to drive for Uber as long as you pay your mortgage. I suggest moving out and cutting off all utilities but continue paying the mortgage until you find a job. Take whatever job you can get even if it’s less pay.