Hey all
Well since most schools (besides state schools) are between 25K - 35K a year the cost is daunting. My wife and I decided today that right before I goto school we will sell the house and move back into an apartment or condo. Ack. On the upside with over 100K of equity in our house we will be debt free and 1st year of med school will be paid.
Tough decision but i think its the best one.
What has everyone else done to get through school?
Mike- did you consider a second mortgage instead of actually selling? I don’t know if you have the equity to do that but it is an option sometimes.
Also…I don’t understand the full details of how it works but there is something you need to look at with how taxes are affected when you make any proceeds on the sale of a home I forget what it is exactly but a tax specialist should be able to tell you and help you avoid any unexpected pitfalls.
If you don’t have any or much equity and are trying to avoid a big housepayment for a few years another option might be to lease the home out and in effect have someone else make payments on it during that time.
Good luck that sounds like a pretty big decision whatever you decide to do!
Jenny
Hey 
well we have about 120K in equity, so we did consider a second. the issue is that we would have to take out about 80K to clear all of our debt. So on top of a mortgage payment we would then have a home equity line of credit payment. Not to mention that would not do anything for school money and loans would come into it.
My wife is a nurse as well so money is good. I dont want her to feel like she is living paycheck tp paycheck though and i dont want a car breaking down to push us over the financial edge.
Upside to selling is the cash. No debt. I do have to check on the tax issue as well, good advice!
Quote:
Mike- did you consider a second mortgage instead of actually selling? I don’t know if you have the equity to do that but it is an option sometimes.
Also…I don’t understand the full details of how it works but there is something you need to look at with how taxes are affected when you make any proceeds on the sale of a home I forget what it is exactly but a tax specialist should be able to tell you and help you avoid any unexpected pitfalls.
If you don’t have any or much equity and are trying to avoid a big housepayment for a few years another option might be to lease the home out and in effect have someone else make payments on it during that time.
Good luck that sounds like a pretty big decision whatever you decide to do!
Jenny
Oh i got the info on home sales and capitol gains here it is in case others are considering the same thing!
How It Works
The key to the entire plan is that you are allowed to sell a principal residence once every two years and exclude up to $250,000 ($500,000 for a married couple) of the gain on the sale. Many of you may be under the mistaken impression that the home sale exclusion is still only “once in a lifetime,” or only available to those of a certain age (such as the elderly), or only available if you buy a more expensive home. Those were the old rules, and they no longer apply. If you meet the two-year ownership and use tests for a principal residence, and don’t sell more than one principal residence in any two-year period, you can exclude any capital gain tax on the sale (up to the $250,000 or $500,000 limits mentioned earlier). So, to get the maximum bang for your buck, you’ll want to understand the rules and have the patience to wait out the two-year residence period.
Quote:
Oh i got the info on home sales and capitol gains here it is in case others are considering the same thing!
How It Works
The key to the entire plan is that you are allowed to sell a principal residence once every two years and exclude up to $250,000 ($500,000 for a married couple) of the gain on the sale. Many of you may be under the mistaken impression that the home sale exclusion is still only “once in a lifetime,” or only available to those of a certain age (such as the elderly), or only available if you buy a more expensive home. Those were the old rules, and they no longer apply. If you meet the two-year ownership and use tests for a principal residence, and don’t sell more than one principal residence in any two-year period, you can exclude any capital gain tax on the sale (up to the $250,000 or $500,000 limits mentioned earlier). So, to get the maximum bang for your buck, you’ll want to understand the rules and have the patience to wait out the two-year residence period.
That’s correct; it’s a “reform” put in place during the Clinton presidency which is one of the primary reasons for the insane housing market. When this bubble bursts I have little doubt that Congress will be forced to revisit this law but in the meantime you might as well take advantage of it. Actually you may want to hurry because there are signs that the house buying boom is slowing down.