GENERAL TOPICS > Coffee Induced Early Morning Rant

Big life decision. Input needed.

(1/5) > >>

Superwhdm:
Morning fellas, Id like you guys to chime in and allow me to borrow wisdom from a pool of knowledge if you dont mind.

We have found ourselves in debt mostly from credit cards to the tune of 40k.  We havent ever budgeted and yes I know we have been ignorant.  We both make very decent salaries but still, living above our means has brought us to a crossroads.  I feel we have caught it just in time.  An awakening happened when we tried to get my wife into a larger vehicle and couldn’t get finiancing from anyone!  We pulled our reports and saw the problem. Overspending has caught up to us. 

We have an option to sell our property which we built 3 years ago.  We have a lot of equity in it and our location is a white hot areas for land and home sales.  Seems everyone is coming down from the city and looking for average and a little farmhouse.  We are thinking of taking the profit and immediately getting out of all outstanding debt and living like gypsies in the 5th wheel for 12 months saving all the money that is therefore available.  We have tremendously gracious family and friends that would accommodate us for that amount of time.  We are strongly considering the adventure, we have two girls, 4 and 1.5yrs. It will be challenging at times but the payoff will be huge when we decide to find land and build again.

The other option is keep what we have and spend years of struggle to catch up and even longer for our credit to do the same.  Kind of a no brainer to me.  However I would like your input, perhaps from your own life experiences.  We are in our 30’s so I figure if we ar going to do this, then the time is now.  We are on a quest for true freedom and happiness.  I feel we have lied to ourselves living the dream (fake) while being a slave to creditors for too long. 

Thanks all!

stlaser:
why Not tap the equity in the house with a low fixed rate HELOC & pay off all the debt consolidating it to one payment. Note you only need to service the interest on this loan on a monthly basis. Sell the fifth wheel & put it towards the debt. Cut out reoccurring monthly bills that are not needed, cable, cleaning lady etc.

Living in a camper for 12 months with two kids does not sound fun to me.

Superwhdm:
With a HELOC, our debt-income ratio wouldn’t warrant a very good rate.  Above that, I do not want to owe more for a longer period of time.  I am interested from getting out of loans of any kind as much as possible.  As for the 5th wheel, we are so badly upside down in it, its worth more to use it.  If I could Id sell it and my Diesel.  We owe 36k on the camper and could maybe get 20 tops.  It’s a 2016 33’ prowler.  I may have 7k equity in the truck. I cant even come close to those two cancelling each other out.  We have gotten an incredibly detailed budget in the works right now that cuts everything out within reason.

stlaser:
Well, you’re doing your research so I think you have both eyes open. The other option and this is coming from a self professed work aholic. However, when my kids were little I worked all the time. Granted I started GLO & then our real estate developments but I know people (one of which is our lead pastor) who picked up evening and weekend work to climb out of a similiar situation.

Bear9350:
Do you like the home you are living in now?  Would you plan on moving/ selling in the near future anyway?  What is the cost of renting compared to your current mortgage payment?  I lived in a camper for about 8 months with my wife while we were remodeling our house.  It was tough with just the 2 of us and the dog.  All we really had to do was sleep in it because every spare waking moment was spent working on the house.  We were able to set a kitchen up in the garage with a real fridge, oven, microwave.  No way I would want to actually live out of it, especially with young kids.

Check out the HELOC.  Get some actual numbers from banks.  Run the numbers comparing your different options.  See what makes the most sense.

My parents were in a similar situation about 10 years ago.  So this next piece of advise is based on their experiences and not my own.  Seek some professional help to come up with a financial plan.  My parents went from being in financial trouble to paying their mortgage off 10 years early.

Navigation

[0] Message Index

[#] Next page