Im so frustrated!!!!...long...advice needed.

I am so bad at this stuff and get such bad anxiety when I think about it.

DH and I bought a very small starter home right after we got married. We were 25 and were extremely proud of ourselves that we could afford to do that, but at the time the house prices were way up etc etc.

Fast forward to now: we feel stuck. We just had a baby and already I am feeling the itch to get a bigger place. We have limited space already and we want more kids in the future.

We cant afford to take a loss. So what do we do...the interest rates right now are much lower than what we paid, which would allow us to get a much more expensive house for pretty much the same mortgage payment a month. We would HAVE to at the very least break even IF we could sell our house and then Im confused, could we get another mortgage with no downpayment? We both have very stable, good jobs and have always paid our mortgage without a problem.

OR is it better to wait out the market? BUT then I feel like we will be in the same situation with the interest rates skyrocketing again and we will not be able to afford to upgrade.

I get in SUCH a funk about this weekly.

We did a lot of work to our house BUT there were a few foreclosures in our neighborhood and a few houses that people bought to "flip" so Im just frustrated and really unsure what to do or how to do it.

Re: Im so frustrated!!!!...long...advice needed.

you can always put it on the market FSBO and see what type of interest you get...

Re: Im so frustrated!!!!...long...advice needed.

do you have enough invested in the house to refinance? then you could save that extra money toward a future house. we saved over $600 a month by refinancing.

Re: Im so frustrated!!!!...long...advice needed.

try FSBO but try to get it featured on Trulia (not sure if you list there or it just takes from other sites alone) that is how we found our FSBO. Also make a HUGE sign in your yard so people notice and if its not a big traffic block then place ads in super markets (flyers) and in the local paper.

Otherwise I suggest you refi and see about bumping out/up or selling in the future.

Re: Im so frustrated!!!!...long...advice needed.

refinancing is not an option for us right now because our house wont appraise for what we would need it to.

Also, since we dont plan in staying in the house for more than another year or two we were advised that it isnt a good idea buy a few different mortgage people.

Re: Im so frustrated!!!!...long...advice needed.

If you stay where you are, would you want to dormer to make it larger in a few years? we are in a similar situation as you, in a coop though. it's way too small with our DC and I feel like I'm going to really LOSE it sometimes. but the price did not go up all that much and we put a lot of work (meaning $) into this place! we want to wait out the market hopefully it will go up a bit, but at the same time, the houses will go up too

Re: Im so frustrated!!!!...long...advice needed.

Can you cover your expenses if you rent it out? If so can you get a loan against the equity in your current home to add to your downpayment of your future home? I know the timing is tricky with something like this but it might be an option for you.

Re: Im so frustrated!!!!...long...advice needed.

Can you add on?

I'm guessing like many recent home owners you probably do not have much equity yet.

In this case, you'd pay any loss out of pocket which is probably not an option. Which leads me to think you should stick to your original plan.

Yes, you will miss the opportunity to get some of the deals that are out there today but you can build up some equity, and as home prices rise yours will to and you will be able to upgrade eventually.

If the situation were such that you would not have to pay out of pocket for any loss, I would say put the house on the market and take the loss because the deal you get on the upgraded house would more than off set the hit on your house.

Re: Im so frustrated!!!!...long...advice needed.

I would ask yourself if a bigger place is really a "need". There are needs... and wants in life.

I am in the same situation as you. I have a smaller house, bought at the top of the market. I am growing out of it. I know if I sell I will take a major hit. So i am simply not selling.

I refuse to make a poor financial decision just because I "want" a larger house. If anything, I will rent out my current place and buy a larger home and hold both houses. I am also considering buying a larger house now while the prices are good and interest rates are low and rent out the new place for a few years. Then i'll eventually move out and sell my existing place when the market turns around. I definitely have options.

Re: Im so frustrated!!!!...long...advice needed.

Re: Im so frustrated!!!!...long...advice needed.

DH and I are in this situation now. With a baby on the way, we just don't think our house is big enough. We decided to bite the bullet and put the house on the market. We figured out what we can afford to take (not a loss) and we won't take anything else. If we can't get what we want, we just won't sell, that's all.

Re: Im so frustrated!!!!...long...advice needed.

as long as you have a two bedroom your should be fine for now. Some people handle two kids with a two bedroom until they reach school age when they kinda need their space.

My friends have three kids and two bedrooms but they a partially finished basement which they just moved the oldest 7 there (not the best situation for a 7 year old on my mind) but it works.

Re: Im so frustrated!!!!...long...advice needed.

Thanks for the responses..

We dont NEED a bigger house right the seoncd BUT we will not last too much longer in this house. We have tiny bedrooms (10x12) and I MAY be able to squeeze a second child in with Sadie but it would be pretty insane. I share the closet in her room and get ready for work in the basement hallway by our laundry room so I dont wake her up.

Our living room is in our basement which is an AWESOME basement that I LOVE, but when sadie starts walking around and stuff, there is no where for her to play on the main floor and I cant see leaving her downstairs while I am cooking etc.

we cant really do the dormer thing either because we are really close to our neighbors and have a small backyard.

Bottom line.. this is not a house we ever thought we would stay in forever. We want a backyard that we can have a patio and maybe a pool, a garage, more bedrooms and space to entertain inside.

I think we will have to suck it up for another year or so and then see what happens.

Re: Im so frustrated!!!!...long...advice needed.

If you've read my posts on this board, you know I've been frustrated and going back on this for a while now too - it is frustrating. We did decide to dormer, but since you can't - I would wait it out. The truth is, as tight as it is for you now - people make it work in a one bedroom with a child, so it can be done (don't get me wrong, I see your struggle).

Instead of going up, could you go out a little to add a little playroom or another bedroom on the first floor for her things?

You COULD list and see if you get any bites - if you're not getting what you need to move up and out - then pull it off the market - there's no harm in it and it doesn't cost you anything if you don't sell.

Also, have you looked around at all. Try not to think so hard about recouping what you spent if you could potentially move to something bigger and better for not much more than you spent (obviously the market goes both ways).

If and when you do decide to stay for a couple of years, if you don't sell, I would make a trip to IKEA and invest in some storage/space utilizing tools - you'll feel good about getting things in better order.

Message edited 6/27/2009 8:03:31 AM.

Re: Im so frustrated!!!!...long...advice needed.

Re: Im so frustrated!!!!...long...advice needed.

You should consult with a mortgage person to see what the actual $$$ are if you were to move. Sometimes when you have the reall #'s, it helps you make a decision better.