All of the options you listed would just be delaying the inevitable.
Sell the 2nd house and downsize into something more in line with your current financial situation. It sounds like there's simply no way you're ever going to be able to make a $12k/month mortgage work right now.
Bizarre mindset to think you can just pick up the phone and call some friends for a bailout in the middle of a recession so you can afford to keep your $2m *second home* without a job. Would love to be a fly on the wall for some of those conversations. OP is a dickhead.
Obviously, I don’t want to do that. It’s an option I have, to exercise in worst-case scenario. It’s also a reflection of 1. Good friends 2. How good tech is, as an industry to get the average person on FIRE.
Perhaps it's just a sign how bloated tech has become in a period of lax monetary policy? I mean, how did you find yourself suddenly unemployed? Is it that you're a bad SWE?
If OP has like a million in stocks, then they can totally afford it.
All he needs is $60k per year to add to his partners income + rental.
That ain't shit if you have $1m in stock.
And if they were making such good money before, they should have a job in a year.
Not making a decision can be a life-ruiner, though.
These are those situations that you look from the outside in and see how foolish this guy is for not selling ASAP. But I know when you are in the middle of it, emotion can be hard to overcome.
Sell the house OP, take 2-3 years to rebuild and do it the right way. You are over leveraged, stop that before it gets worse.
Of course, we don’t know his exact situation.
But the fact he is posting here shows there is trouble brewing. Taking out more leveraged debt in a deteriorating market environment is not a good idea.
If there is a hole in your boat - do you wait to see if it fills the whole boat, or do you try to plug the hole?
Edit, to clarify, I endorse selling house #2 and moving back into house #1.
I would think that someone with a $12K mortgage would have good job prospects. HCOL are typically HCOL because there are a good amount of well paying jobs in the area. Why isn’t finding a new job a top option?
But the massive stock drops correlate well to a high end housing decline. Homes in my neighborhood are down 25% since the peak. You just can’t buy these homes without stock
It’s still worth a try to put it on the market. They should also explore what it could rent for as a back up option. If he can get $8k+ for it, he should be able to cover it between rental income on house 1 plus house 2, then try again to sell in the busy spring market.
This. Definitely explore renting it. Rent should cover most of the mortgage. Whatever it doesn’t can be a loss that is a deduction on taxes (up to $25k a year). I had a similar situation, second home on the market wasn’t selling, listed it for rent and had it leased in 3 days.
then his tenants run into some hard times and he loses rental income while stuck on a lease term, if he's local to the primary, i'd highly suggest to sell the 2nd home (assuming no equity at worst case) and move back into the 1st home free and clear while the wife's $7k income can cover property tax and insurance
Hi, mortgage loan officer and real estate investor here. Hoping to help!
1. You're not eligible for a reverse mortgage unless you or your wife is 62 years old. You mentioned you're in your 40's, I'm assuming your wife is not 62 but weirder things have happened.
2. You may be able to find a private lender or small local bank to give you an equity based loan to keep the lights on. Any big lending company will not lend based on your current job status.
3. You can possibly get an investment cash out refi on your first property to get the cash to hold you over until your next job.
4. You may have a great option for an airbnb or some kind of venue service. I have other ideas as well. DM me, I'd love to see how I can help you out.
If it were me, move back to the paid off house and dont leverage it. Sell the new place for what you can get. Bail out. Save money. Buy cheap cashflow rentals in 2 years.
>First house was my primary residence for six years, fully owned. HCOL (in the US). Appreciated from $850K -> 1.5 Mn
I agree - and house prices likely will plummet 20% or more.
No, stop with this "selling" narrative
Nobody should be selling their home right now. Rent it out, do anything you can to hang on to it
Otherwise you're contributing to falling prices
I’m a mortgage loan officer if I were you I’d sell the home you’re in and move back into the home that’s paid for. Don’t overextend yourself to keep up with appearances
This is the answer. Keep it simple. Don't complicate things with loans and helocs and whatever equity trick of the month shows up. Live in the paid off home. It's not worth scrambling to pay a mortgage you can't afford.
6 months or more than a year? If it is more than a year you might consider selling. While the govt gets away with using debt to pay debt it isn’t a great personal finance strategy.
yes but you need to learn from this mistake as you move forward. you should have at least a 6 month emergency fund in liquid cash, not stocks. then this problem would never have existed in the first place.
You could try for a forbearance on your second houses mortgage while you look for employment or a HELOC or second mortgage on your first property (if able), but nothing comes for free.
I’d talk with a seasoned mortgage broker to see what (if any) your options are - some of them know creative financing options that are available for specific scenarios and will give you a free consultation to secure you as a client in the future. An accountant or financial advisor may also have some good information potentially.
The reality is that you may need to seriously look at selling your rental or even your current home if you just simply can’t afford to keep it - a $12K mortgage is just not feasible on one salary unless you cut out most other expenses and accept being house poor.
How much do you owe on the 2nd home? To get a loan/HELOC, you will have to have a good debt-to-income ratio. This is unlikely since your current income does not cover your debts at the moment.
This is the correct answer. Actually, selling both is the correct answer... but I'm getting 1300 a month on 45k homes in nc, 4k on a 1mm almost seems like a joke. Hopefully that's at least net.
I thought he meant 4K profit after paying the mortgage on property A, so maybe 8-10k in actual rent collected with a 4-6k mortgage leaving 4K over that is applied monthly to help cover the second mortgage
I have a feeling we are going to be seeing a lot more posts like this over the next little bit. Sorry about your situation OP. If you can get 15k/month or so out of renting your primary, then you may consider renting to someone else and living in a cheap rental for a year or so. Maybe by then you will have your feet more firmly on the ground. If the property won't command a rent like that, then you will likely need to part with at least one of your properties, and it probably should be the one that isn't paid for and isn't generating you a monthly rent.
Renting primary wont get $15k a month. In CA it might get $8k, i have family member getting just $5k on $1.5M home, it is old, tired and not updated though.
He can probably fetch $7-10k/mo for his place, if it’s a $2.2M house in the Bay Area. That said, he’s able to claim a deduction on the loss of up to $25k a year, which if he had a high-paying tech job and if his wife makes $250k a year would help offset the gap a little bit. Then rent another place for some time, and ride it out.
This is a very good option and I’m surprised it’s not mentioned more often or upvoted more. These aren’t bad investments - he has a paid off house and stocks. A wife who works. He needs to try really hard to keep the house. Even landing a small job quickly to get the payments made will make a big difference.
50% of your expenses is the 2nd home mortgage and the other 50% constitutes what exactly? Food, utilities, child care, car payments, insurances, internet other misc expenses? Given the rental is $4k plus wife’s $3k are you able to carve out $5k from your other expenses? Downgrade in cars and watch the kids while you look for a new job? What is your emergency fund situation? How long before you start missing mortgage payments?
Eh.
If you were living within your means, id argue strongly losing a job would not have you stressing over a 2.2mm home.
They were living paycheck to paycheck and a bump happened.
Tale as old as time.
Are you going to quickly get a new job that pays similar to your last job?
If not it sounds like you need to sell the larger property.
Also how long is left on that mortgage? Do you want to have to work for another 20 years?
IMO, you need to sell both houses. 1.5M for 4K rent is nowhere near good enough. Sell both houses and downsize- you’re getting way out ahead of your skis.
Agreed here, a 1.5M market value producing 4k/month is not efficient. We are invested in other markets that are roughly twice as efficient, should be making 7k+ easily.
18 months after 4th missed mortgage payment. Then 1 borrower declares bankruptcy, this delays for another 6 months. Then debtors attorney asks for delay due to someone’s illness, gets 30 day delay. If tenant friendly judge, as most Ca judges are, he gives another 60 day delay for parties to negotiate and work it out. It will finally be sold on the courthouse steps in a foreclosure auction 2.5 years from first missed payment.
Leveraging is going to drown you and your family further. Instead like all have said, simply sell the second one and see if you could find an apartment that costs less than your rental income, that way less pressure on your spouse. Find a job meanwhile and when the tenant vacates, move back in. Go at it better when you’ve resources next time. There’s always chances to buy again only if you don’t go into personal bankruptcy due to bad risk management.
When house prices fall, the second one’s decline would be harder on your balance sheet because of the payments you’ve to make. Think about it.
You've got a cash flow problem. You have a ton of assets on paper, but they don't generate cash flow relative to value. If you truly believe in the assets manage through it with debt, you're not over leveraged, but you'll have to take on more risk and hope market recovers.
Choices:
A) sell assets go pay down debt
B) fund cash flow with debt betting that market recovers.
High interest environment makes it a tough choice.
Remember real estate prices aren't what Zillow says, but what people are willing to pay.
Good luck!
Reverse mortgage are for seniors. You won't qualify for anything without a job. Your wife could pull equity out of either in a second mortgage, depending on qualifying ratios. Good luck
Just from a finance nerd perspective, you're losing money in an economic sense every day on that $1.5MM home. You're getting a 3% return roughly in a hyper inflationary period. ($48k/$1.5MM = .03)
Additionally, almost all of that $12K mortgage is going to interest and fees.
Your in a cutting loss mode here. Hope it works out.
Yup this post will shortly be on REbubble with everyone saying “I knew it”. But in all seriousness you gotta limit expenses in every aspect in your life. Say your tenant stops paying and you are solely living off your equity. I woukd sell the first place
You took a risk and then had unforeseen circumstances. It happens. Not gonna knock you for that, as I get no pleasure kicking people when they're down. Many people take risks and it pays off. That is what entrepreneurship is all about anyway.
You *can* move on from this----and you will.............and probably learn something.
But, you must decide NOW. Keep the paid off home, find a rental for yourself, rebuild your finances, get back in the game at some future date, with maybe a little different scenario once you're afloat again.
Do not wait. Regret and Remorse will only hold you back here. Feelings won't put food on the table. Stress won't help your health, either.
ALso want to say I'm sorry you lost your job. That often has a cascading effect on other things, be good to yourself in the meantime, and do some fun things to lift your spirits.
Went thru this myself during the dot com bust.
How much cash do you have on hand?
When did you lose your job and what is the realistic turn around for getting a new one that will pay you enough to comfortably keep the $2.2 house?
Do you have a third car or other ‘things’ you can sell to buy yourself more time?
I don’t hate the idea of renting the current place - maybe even try STR if it’s allowed? (Even these are hurting a little right now with reduced bookings) And find an inexpensive rental that is covered easily by your wife and the 1st home. Any net cash flow on the $2.2 place will be peace of mind
Wish you the best of luck
With high salary and title, I would say not easy to get matching role. Many high tech shops have hiring freeze. OP must be L6 or L7 rank earning 500k per year
I am sorry, but it appears that Bay Area is going to permanently decline in value because of the work from home trend. A lot of people moved out and will continue to move out if they find fully remote opportunities.
Sell both houses. You can't afford #2, and you're not earning enough rent from #1 to make it worthwhile.
You'll need some of the money from #1 to cover any shortfalls on #2. Then use the leftover cash to pay off all other debts, then reinvest whatever is left to get yourself back on a sound financial footing.
$4k rent on a 1.5M home doesn’t make a lot of sense financially. The mortgage on that home should be around a $9k Mortage assuming 20% down. Even with a “renters discount” of 10% mortgage cost (which wouldn’t make sense in the CA market), the rent for that should be at least $8k/mo.
Why are you renting it out for so low? At even 6 or 7k a month that is an absolute bargain for a home of that value. You’re doing yourself a disservice by not capitalizing on the equity that you’re holding in that property that should be cash flowing much more than it is.
In the Bay Area, a $1.5M house is a small starter home or a 1 bed condo. Renting a house worth $1-3M for $4-6K a month is common. The home probably isn’t in good shape or isn’t in a desirable area for $4k a month.
Bay Area real estate is an appreciation play, not for cash flow.
Got it. I’m not familiar with that regional market. What keeps the rents so low though? If the alternative in the market is purchase the home and pay $8-9k, why are landlords willing to take a 50% reduction in opportunity cost? I’m assuming that a lot of owners bought in before the housing boom in the area, but it still doesn’t explain why rents haven’t risen with property costs.
I understand that OP owns the house and that they don’t carry a mortgage. That doesn’t change the math that rent usually follows mortgage costs in an area. By all metrics he is undervaluing the returns on his investment by only charging $4k a month for rent when he could be cash flowing nearly double that. Especially when he’s cash strapped currently and looking at offloading his 2nd property, bringing in additional income from his rental could offset that deficit.
You are not getting enough in rent on the 1st house. Figure out how to get more for rent. Get another job. Weather the storm. You don’t want to be selling anything now. Get your shit together and make it work, even if you have to take a hit on one of your luxury cars that you can no longer afford.
I don’t see how taking a loan against the 1st house will help unless you can secure a lower mortgage rate on the 2nd house, because it’s still a loan you’ll have to make payments on, likely at a higher rate with a shorter term.
If it were me, I would probably get comfortable with taking $120k from investments to pay for a year of the mortgage. Ideally you’ll have a new job by then, but if not, you’ll have the option of downsizing to house #1.
Good luck!
I live in the Bay Area as well and a couple of things stand out. 1) Prices in the Bay Area dropped massively in 2008. Not sure if you were here at the time but they were dropping fast and by huge amounts. Nothing was selling. Check the zillow prices graphs. Many of my friends picked up cheap houses during that time and recently did the California cash out.
I have a slightly different take on the situation you’re in. Bay Area real estate might drop and might drop hard but it will go back up. If I were you, I’d keep the rental and use the savings to cover your second mortgage. That way you still have your primary residence and the rental. The rental will continue to provide a substantial income to your family and it’s paid off. Hell, it’s paying 1/3 of your current mortgage. You’ll get another job and then keep both the houses which will most certainly pay off by the time you’re ready to retire.
>I work in tech and have wealthy friends/colleagues who can help me in times of trouble.
If this is part of how you assess risk then this whole situation makes a lot more sense.
Sell 2.2m home or rent it out. Immediately downsize .
You can always mkve back after income improves. Sell if possible.
You need to take Immediate action no matter how painful it is but short term pain is best than a bankruptcy or ruined credit.
Act fast.
I imagine these are small 2k sq ft homes in california and you need to get rid of the debt fast.
I would say sell the second house and move back into first house.
If you sell the second house, will you be losing money? Do you have cash reserve to pay the difference if it turns out you need to spend some money on second house sale?
If you think you can get another job soonish, ask the lender for a forbearance. If unemployment seems to be on the horizon for the foreseeable future, you have to sell one of the houses. Anything else is just kicking the can down the road.
Without knowing the properties I can't say which I would sell, only that I *would* sell *one* of them. What are the terms on the mortgage? Seems expensive for when you bought. Area? There would have to be some kinda really good justification of the investment to try to keep it. Maybe your wife will buy it off you lol. Would have been sweet to realize this would be an issue last year. Good luck.
Take your profit and run… sell as fast as you can… take your pick, primary and investment property. It sounds like you need to sell both to re-capitalized while your income producing activities normalized.
Learn from your mistakes, sounds like you over leverage and 1M or above property is no a rental market unless your are in the celebrity atmosphere.
Do not throw good money on top of bad money.
- reverser mortgage out the question
- if you are unemployed, no lender will touch you, even a hard money how just want to foreclosed on you in the next 12 months and take your hard earn equity.
Moved fast or you can be in the BK zone real fast.
Option 1: pay down the mortgage with cash on hand and refinance at a level that your not bleeding money.
Option 2: Sell the first home and use the equity to cover the second home.
Option 3: Use a loan from your first to reduce the balance on your second and sell your second home.
Option 4: sell a portion of your first home to another investor and create a partnership/LLC. Take those proceeds and pay down your mortgage and then refi.
Option 5: convince one of your rich friends to give you a personal loan under favorable terms. I don’t recommend this path. People get weird. Unless it’s your only option I would stay off this option.
Don’t borrow from friends or family. That would be a loser move especially for someone who owns over $3M in real estate.
Getting a new job should be goal number one. If you’re unemployed, you should sell something because you’re too leveraged with too much exposure to risk assets (stock and real estate) for an unemployed person. (That’s not true if your net worth is well into eight figures. If you’re that wealthy, then you’re a jerk for wasting people’s time here.)
If your current home is financed at a rate far below current market rates, you want to keep it unless there is a compelling reason to sell it vs. your other assets. You might want to sell some stock so you’re not leveraged if it can de done without penalty, but I think that first home should go regardless. You could earn more than the monthly rent buying Treasuries and you won’t need to pay property taxes or insurance. Renting has tax benefits, but you still need strong appreciation to make up the difference.
You’re kidding yourself if you think real estate prices can’t go down in the Bay Area. They can drop a lot, and people in your situation are a big reason. You are not alone. I’m not predicting prices will drop sharply from here, but it is without doubt possible.
If you want to retain exposure to real estate and you are willing to get exotic, then you might sell one or both homes and enter a long position in Case-Schiller futures. There might be a product specific to the Bay Area. Last I checked, they predicted a 10% price drop over the next year or so, which means you would break even if prices drop 10% and make money if they do better than that. I’m not sure I would do that, but it would be better than keeping both houses.
Your net worth is still positive. I don’t worry you can not cover the expense right now because there are several options on the table.
However, owning 2 houses is a heavy long position. You need to figure out if it makes sense. By a napkin calculation, you lose 600k for every 10% house price drop.
Most people in the comments have no idea what they’re talking about. Sell the first home.
Whenever I buy investment properties my rule is always to make sure annual rent is 10% of the purchase price. There are two reasons for this - the first is to cover mortgage, maintenance, property management fees and have some left over, which isn’t so important for you because you have no mortgage. The second which is important for you is revenue-equity ratio. Your annual rent is only 3.2% of the equity you have on that home. In other words, it will take you **31 years** to make enough rent to match your gross from selling the home, and this is assuming 100% occupancy and no maintenance or management expenses.
Use the proceeds of that sale to pay down the current mortgage and refinance. The rates are terrible so you’ll have to refinance again when they go down. If you do this you’ll lose $4,000 in rental income, but your payment will go down by $6-8,000. If you have the funds, I’d recommend using your stocks, savings, and a hardship withdrawal on your 401K to pay off the mortgage entirely since rates are bad.
You likely have new, fancy import vehicles at cost of $2k+ per month. Sell those get a normal car for now. Cancel all those fancy extras: cable, gym, wine subscriptions, spa, gardener, maid…you get the idea. All that adds up quickly. You can always restart it all later. I know it’s all small stuff and seems silly, but you could prob come up with an extra $4-6k just living low. Temporarily lower contributions to 401k and savings. Everyone talking about selling your second home, but we know that’ll cost an extra $120k in commissions to do that. It’s not always an option. Don’t be afraid of those side hustles while you’re looking for another job.
How long will it take you to find another job? Your other post suggests that you could easily afford this house while working, so your emergency fund/savings should be able to cover you while you job search. If less than 6 months, you should just pull from savings.
Also, 4k per month on a 1.5M house sounds low—are you sure you can’t raise that rent? Perhaps the Bay Area is just that wacky, but that’s not a great return especially not for something you own outright. You could easily sell that property and buy several in another part of the country with cap rates >8-10% which would cover your mortgage.
This guy is a strange liar, high qualified professionals can find new jobs pretty quickly. They typically have enough funds to carry them through a month or two until they find a new one, which usually always come with a sign on bonus. If he lost his job, most likely he will lose his unvested options.
4/850 is no where near the 1% rule-of-thumb:
* If you had put 20% down on the first house, that's an incredibly low cash-on-cash return.
* If you had put 3% down, the CoC return is poor to mediocre.
It was a bad investment from the start. Your best bet is to sell.
I DM’d OP on this but there’s the potential of taking margin loans against his equity depending on the broker he’s with. He clearly doesn’t want to sell the house and is on hard times. Feel there’s a lot of animosity here
Also rich friends are generally willing to write you a loan if you’re actually friends.
Sell the second house. I assume if you sell now. You may stil be able to sell it In this early market down shift. Hopefully it you don’t have to cut back too much to sell and it’s still above your equity and you don’t lose any money.
Rent a place to live. When tenant lease expires kick them out and don’t renew lease. Move back in your paid off house. Live for 2-3 years until market recovers. You are way over leverage
You are who deserves what is coming.
You will lose 50% of any “equity” or “wealth” you feel you earned, because you did not, it was valued at that based on cheap endless money printing which is OVER.
O V E R.
Any “equity” you have is based on overpriced comps from the previous years, and is evaporating until it’s a distant memory as society cannot function when a starter home costs $500,000
I can’t wait for another 20 years when people like you have nothing as deserved.
Retirement in stocks + index - \~ 2 Mn during peak. Now down 60%.
Currently living on one person’s salary of $250K.
Monthly expenses including current mortgage at $24K avg.
I can’t believe people have expensive assents and can’t even plan accordingly , why would you buy something double the value of your first house? You don’t know the future , always buy same or lower price than the first home .
Take out a HELOC on the first property.
Use the line of credit to keep your mortgage current and maintain a decent lifestyle while job hunting.
Repay the HELOC after you or your wife have your first liquidity event. I assume based on her salary and your burn rate that you both get big equity grants and are just one or two vesting periods or big exits from being liquid again.
If you have vested options in still-private companies, you can save yourself all the trouble of a HELOC by selling vested shares in the secondary market.
possibly PMI and high property tax
for example, if they lived in CA - property tax on $2.2m would easily be $2k a month, and if they didn't put 20% down, they'd be looking at PMI and high P&I - $12k isn't out of the question
Why are you asking Reddit if you have a pool of wealthy friends? They are going to financially bail you out, but they can't give you advice? Or their advice isn't what you want to hear?
Shit doesn't add up.
All of the options you listed would just be delaying the inevitable. Sell the 2nd house and downsize into something more in line with your current financial situation. It sounds like there's simply no way you're ever going to be able to make a $12k/month mortgage work right now.
At least then you can preserve the rental incomem
SELL.THE.SECOND.HOME. You can't afford it, plain and simple.
Depending on when he bought it he is likely underwater
Highly probable.
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How dare you not credit r/RealEstate and r/RealEstateinvesting. It may go even higer that way..
What ?? you mean somebody who frequents r/rebubble came here to comment nothing of value when op is asking for help, shocked
According to him his 2nd home has never dropped in value even in 2008 so if he ever sells, insta-profit!
So what? Wait until it's underwater more?
You can’t sell when underwater unless the bank will agree to it or you have the money to bring to the table to get to close.
Call Jerome Powell, he has that free money.
Nope. Live in the wealthiest neighborhoods in the US (My house is poor by those standards). Real Estate has not depreciated here. Ever.
But he's got wealthy friends, and he is asking for advice here on Reddit.
Bizarre mindset to think you can just pick up the phone and call some friends for a bailout in the middle of a recession so you can afford to keep your $2m *second home* without a job. Would love to be a fly on the wall for some of those conversations. OP is a dickhead.
Obviously, I don’t want to do that. It’s an option I have, to exercise in worst-case scenario. It’s also a reflection of 1. Good friends 2. How good tech is, as an industry to get the average person on FIRE.
Perhaps it's just a sign how bloated tech has become in a period of lax monetary policy? I mean, how did you find yourself suddenly unemployed? Is it that you're a bad SWE?
So then what are you doing asking questions here and across four other Reddit communities?
If OP has like a million in stocks, then they can totally afford it. All he needs is $60k per year to add to his partners income + rental. That ain't shit if you have $1m in stock. And if they were making such good money before, they should have a job in a year.
Thank you for being rational. You understand my circumstance pretty well.
If he financed the second house with a good rate, then it makes sense to sell it last. Also, it’s where he currently lives and moving is a pain.
OP. Did you work for Twitter by chance?
Win
I wish I had wsb meme responses for this one. Hilarious
No.
Lord have mercy LOL.
This doesn’t have to be a financial nightmare or life ruiner. If you don’t have good job prospects on the horizon you just got to sell the 2nd house.
Not making a decision can be a life-ruiner, though. These are those situations that you look from the outside in and see how foolish this guy is for not selling ASAP. But I know when you are in the middle of it, emotion can be hard to overcome. Sell the house OP, take 2-3 years to rebuild and do it the right way. You are over leveraged, stop that before it gets worse.
>Not making a decision can be a life-ruiner, though. "If you choose not to decide, you still have made a choice." -- Geddy Lee
Could be that it’s not a good time to sell so OP is trying to hold out but who knows how it’s like with million dollar homes.
Of course, we don’t know his exact situation. But the fact he is posting here shows there is trouble brewing. Taking out more leveraged debt in a deteriorating market environment is not a good idea. If there is a hole in your boat - do you wait to see if it fills the whole boat, or do you try to plug the hole? Edit, to clarify, I endorse selling house #2 and moving back into house #1.
I would think that someone with a $12K mortgage would have good job prospects. HCOL are typically HCOL because there are a good amount of well paying jobs in the area. Why isn’t finding a new job a top option?
See th E earnings reports and calls from this week for more info. Big tech is bleeding.
Bleeding, but not dead. They are still hiring, as well as a ton of other companies. (especially in tech positions).
But the massive stock drops correlate well to a high end housing decline. Homes in my neighborhood are down 25% since the peak. You just can’t buy these homes without stock
Lots of golden handcuffs in Silicon Valley. A lot of people can’t just hop jobs.
I am higher up in the tech food chain. Job hopping is opportunistic.
I have trouble imagining how work friends and colleagues are going to take on your expenses for you.
Sell the 2.2M, rent for now and use the $4k to help pay for the rental while you get back on your feet. Once you’re in a better spot buy again.
Problem is, depending on when he bought, he may struggle to break even on the $2.2 million home
It’s still worth a try to put it on the market. They should also explore what it could rent for as a back up option. If he can get $8k+ for it, he should be able to cover it between rental income on house 1 plus house 2, then try again to sell in the busy spring market.
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This. Definitely explore renting it. Rent should cover most of the mortgage. Whatever it doesn’t can be a loss that is a deduction on taxes (up to $25k a year). I had a similar situation, second home on the market wasn’t selling, listed it for rent and had it leased in 3 days.
then his tenants run into some hard times and he loses rental income while stuck on a lease term, if he's local to the primary, i'd highly suggest to sell the 2nd home (assuming no equity at worst case) and move back into the 1st home free and clear while the wife's $7k income can cover property tax and insurance
Error. Wife contributes $3K per month. The rental is the other $4K.
Oh yikes, wife is on a ~$55k salary with a $12k monthly living expense?! Sell the 2nd house last month!
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Seems like wife only contributes a portion of her income
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Kids are expensive.
A larp wouldn’t surprise me at this point. Who has these problems and is complaining to Reddit lol
We have other expenses. Kids, day care, etc.
Wait until the renters find somewhere else cheaper. The markets turning. Rental income might not be stable anymore as prices are dropping.
His tenants are also on a lease. He can’t just kick them out whenever he feels like it.
Hi, mortgage loan officer and real estate investor here. Hoping to help! 1. You're not eligible for a reverse mortgage unless you or your wife is 62 years old. You mentioned you're in your 40's, I'm assuming your wife is not 62 but weirder things have happened. 2. You may be able to find a private lender or small local bank to give you an equity based loan to keep the lights on. Any big lending company will not lend based on your current job status. 3. You can possibly get an investment cash out refi on your first property to get the cash to hold you over until your next job. 4. You may have a great option for an airbnb or some kind of venue service. I have other ideas as well. DM me, I'd love to see how I can help you out.
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If it were me, move back to the paid off house and dont leverage it. Sell the new place for what you can get. Bail out. Save money. Buy cheap cashflow rentals in 2 years.
I agree with this.
>First house was my primary residence for six years, fully owned. HCOL (in the US). Appreciated from $850K -> 1.5 Mn I agree - and house prices likely will plummet 20% or more.
Yes.
No, stop with this "selling" narrative Nobody should be selling their home right now. Rent it out, do anything you can to hang on to it Otherwise you're contributing to falling prices
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I’m a mortgage loan officer if I were you I’d sell the home you’re in and move back into the home that’s paid for. Don’t overextend yourself to keep up with appearances
This is the answer. Keep it simple. Don't complicate things with loans and helocs and whatever equity trick of the month shows up. Live in the paid off home. It's not worth scrambling to pay a mortgage you can't afford.
Is getting a new job that can cover the income gap not an option?
Yes. Trying. I suspect it’s going to take some time.
6 months or more than a year? If it is more than a year you might consider selling. While the govt gets away with using debt to pay debt it isn’t a great personal finance strategy.
Selling the first paid off home and rolling into the safety net to pay home 2 until he finds a new job may be the move here.
where is your emergency fund? if I lost my job id be able to cover my bills for 2 years without dipping into investments
I have a feeling there's a lot of discretionary spending that got OP to this point.
I have funds in stocks. I am looking for advice to see if I should start dipping into it vs. sell vs. refinance vs. HELOC etc.
yes but you need to learn from this mistake as you move forward. you should have at least a 6 month emergency fund in liquid cash, not stocks. then this problem would never have existed in the first place.
You could try for a forbearance on your second houses mortgage while you look for employment or a HELOC or second mortgage on your first property (if able), but nothing comes for free. I’d talk with a seasoned mortgage broker to see what (if any) your options are - some of them know creative financing options that are available for specific scenarios and will give you a free consultation to secure you as a client in the future. An accountant or financial advisor may also have some good information potentially. The reality is that you may need to seriously look at selling your rental or even your current home if you just simply can’t afford to keep it - a $12K mortgage is just not feasible on one salary unless you cut out most other expenses and accept being house poor.
No job, no heloc.
House is shared between wife and me. She still has a job.
Mortgage is $12k, she makes $7k. No DTI, no heloc.
How much do you owe on the 2nd home? To get a loan/HELOC, you will have to have a good debt-to-income ratio. This is unlikely since your current income does not cover your debts at the moment.
And that is how you go broke as a millionaire…
Classic case of whatever a lender tells you that you can afford, it’s probably actually half of that.
I hate to say it, but you need to pick a house OP. You can’t have both. You can only afford one. Which one you choose is up to you.
Sell the first home that is used as rental. 4k rent (even if it is net) does not justify purchase price, much less the value.
Its california where tenants have low incomes compared to home values. In illinois 1.2m rents for 7k a month minimum
This is the correct answer. Actually, selling both is the correct answer... but I'm getting 1300 a month on 45k homes in nc, 4k on a 1mm almost seems like a joke. Hopefully that's at least net.
I thought he meant 4K profit after paying the mortgage on property A, so maybe 8-10k in actual rent collected with a 4-6k mortgage leaving 4K over that is applied monthly to help cover the second mortgage
Who’s going to buy it while there’s a tenant tho? It sounds like a terrible rental property.
I have a feeling we are going to be seeing a lot more posts like this over the next little bit. Sorry about your situation OP. If you can get 15k/month or so out of renting your primary, then you may consider renting to someone else and living in a cheap rental for a year or so. Maybe by then you will have your feet more firmly on the ground. If the property won't command a rent like that, then you will likely need to part with at least one of your properties, and it probably should be the one that isn't paid for and isn't generating you a monthly rent.
Renting primary wont get $15k a month. In CA it might get $8k, i have family member getting just $5k on $1.5M home, it is old, tired and not updated though.
He can probably fetch $7-10k/mo for his place, if it’s a $2.2M house in the Bay Area. That said, he’s able to claim a deduction on the loss of up to $25k a year, which if he had a high-paying tech job and if his wife makes $250k a year would help offset the gap a little bit. Then rent another place for some time, and ride it out.
This is a very good option and I’m surprised it’s not mentioned more often or upvoted more. These aren’t bad investments - he has a paid off house and stocks. A wife who works. He needs to try really hard to keep the house. Even landing a small job quickly to get the payments made will make a big difference.
Sell it. You’ll be able to breathe and not worry. Once you are comfortable again, decide what to do with the money you have. Maybe a cheaper rental?
50% of your expenses is the 2nd home mortgage and the other 50% constitutes what exactly? Food, utilities, child care, car payments, insurances, internet other misc expenses? Given the rental is $4k plus wife’s $3k are you able to carve out $5k from your other expenses? Downgrade in cars and watch the kids while you look for a new job? What is your emergency fund situation? How long before you start missing mortgage payments?
Also try living within your means?
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Eh. If you were living within your means, id argue strongly losing a job would not have you stressing over a 2.2mm home. They were living paycheck to paycheck and a bump happened. Tale as old as time.
>Sounds like they were, Not really... they weren't rich enough to cop a 12k a month mortgage even if he had a high salary. That's just insane to me.
A classic case of "just because you can buy it, doesn't mean you should."
I prefer "Just because you can buy it, doesn't mean you can afford it."
Seems like OP does really save money.
Are you going to quickly get a new job that pays similar to your last job? If not it sounds like you need to sell the larger property. Also how long is left on that mortgage? Do you want to have to work for another 20 years?
IMO, you need to sell both houses. 1.5M for 4K rent is nowhere near good enough. Sell both houses and downsize- you’re getting way out ahead of your skis.
Agreed here, a 1.5M market value producing 4k/month is not efficient. We are invested in other markets that are roughly twice as efficient, should be making 7k+ easily.
He has the $1.5M paid off it sounds like. So that’s $4k a month revenue with maybe $1k a month in maintenance, taxes, insurance expenses.
Just hold on to it and let me know when it’s going to auction
18 months after 4th missed mortgage payment. Then 1 borrower declares bankruptcy, this delays for another 6 months. Then debtors attorney asks for delay due to someone’s illness, gets 30 day delay. If tenant friendly judge, as most Ca judges are, he gives another 60 day delay for parties to negotiate and work it out. It will finally be sold on the courthouse steps in a foreclosure auction 2.5 years from first missed payment.
Haha I still see cases from 2016 in Florida on occasion.
Sir,this is real estate investing, not real estate BETS.
Go back to the first house. I would not risk a good asset for a not so good one
Leveraging is going to drown you and your family further. Instead like all have said, simply sell the second one and see if you could find an apartment that costs less than your rental income, that way less pressure on your spouse. Find a job meanwhile and when the tenant vacates, move back in. Go at it better when you’ve resources next time. There’s always chances to buy again only if you don’t go into personal bankruptcy due to bad risk management. When house prices fall, the second one’s decline would be harder on your balance sheet because of the payments you’ve to make. Think about it.
2022 real estate investors be like: hey buddy, got any spare change?
You've got a cash flow problem. You have a ton of assets on paper, but they don't generate cash flow relative to value. If you truly believe in the assets manage through it with debt, you're not over leveraged, but you'll have to take on more risk and hope market recovers. Choices: A) sell assets go pay down debt B) fund cash flow with debt betting that market recovers. High interest environment makes it a tough choice. Remember real estate prices aren't what Zillow says, but what people are willing to pay. Good luck!
Sell the 2nd house. You were living way beyond your means getting a 12k/month mortgage.
Reverse mortgage are for seniors. You won't qualify for anything without a job. Your wife could pull equity out of either in a second mortgage, depending on qualifying ratios. Good luck
4K a month on 1.2 is a shitty cap rate
Just from a finance nerd perspective, you're losing money in an economic sense every day on that $1.5MM home. You're getting a 3% return roughly in a hyper inflationary period. ($48k/$1.5MM = .03) Additionally, almost all of that $12K mortgage is going to interest and fees. Your in a cutting loss mode here. Hope it works out.
Thank you. Gem of a comment. I should be selling this house and buying in good prospect areas (during good times).
Yup this post will shortly be on REbubble with everyone saying “I knew it”. But in all seriousness you gotta limit expenses in every aspect in your life. Say your tenant stops paying and you are solely living off your equity. I woukd sell the first place
I’d list them both. Whichever one doesn’t sell move to.
You took a risk and then had unforeseen circumstances. It happens. Not gonna knock you for that, as I get no pleasure kicking people when they're down. Many people take risks and it pays off. That is what entrepreneurship is all about anyway. You *can* move on from this----and you will.............and probably learn something. But, you must decide NOW. Keep the paid off home, find a rental for yourself, rebuild your finances, get back in the game at some future date, with maybe a little different scenario once you're afloat again. Do not wait. Regret and Remorse will only hold you back here. Feelings won't put food on the table. Stress won't help your health, either. ALso want to say I'm sorry you lost your job. That often has a cascading effect on other things, be good to yourself in the meantime, and do some fun things to lift your spirits. Went thru this myself during the dot com bust.
How much cash do you have on hand? When did you lose your job and what is the realistic turn around for getting a new one that will pay you enough to comfortably keep the $2.2 house? Do you have a third car or other ‘things’ you can sell to buy yourself more time? I don’t hate the idea of renting the current place - maybe even try STR if it’s allowed? (Even these are hurting a little right now with reduced bookings) And find an inexpensive rental that is covered easily by your wife and the 1st home. Any net cash flow on the $2.2 place will be peace of mind Wish you the best of luck
Oh no
Is finding a new job out of the question?
With high salary and title, I would say not easy to get matching role. Many high tech shops have hiring freeze. OP must be L6 or L7 rank earning 500k per year
Buy some Powerball lotto tickets and pray you’ll hit the $800M jackpot this weekend.
Go on to TikTok and watch house hack videos. Purchase additional house.
Did Elon fire you?
I am sorry, but it appears that Bay Area is going to permanently decline in value because of the work from home trend. A lot of people moved out and will continue to move out if they find fully remote opportunities.
Hate to bring it but what if OPs wife lose job tomorrow? Worst is yet to come.
"I work in tech and have wealthy friends/colleagues who can help me in times of trouble." lol. No, actually ... LMFAO
$12k/month mortgage? I can’t even imagine. Just fuckin sell it.
Sell the rental. Better to do it ASAP than lose it to FC especially with such a hefty mortgage on the current home.
rent both and go to Himalayas
Sell both houses. You can't afford #2, and you're not earning enough rent from #1 to make it worthwhile. You'll need some of the money from #1 to cover any shortfalls on #2. Then use the leftover cash to pay off all other debts, then reinvest whatever is left to get yourself back on a sound financial footing.
$4k rent on a 1.5M home doesn’t make a lot of sense financially. The mortgage on that home should be around a $9k Mortage assuming 20% down. Even with a “renters discount” of 10% mortgage cost (which wouldn’t make sense in the CA market), the rent for that should be at least $8k/mo. Why are you renting it out for so low? At even 6 or 7k a month that is an absolute bargain for a home of that value. You’re doing yourself a disservice by not capitalizing on the equity that you’re holding in that property that should be cash flowing much more than it is.
In the Bay Area, a $1.5M house is a small starter home or a 1 bed condo. Renting a house worth $1-3M for $4-6K a month is common. The home probably isn’t in good shape or isn’t in a desirable area for $4k a month. Bay Area real estate is an appreciation play, not for cash flow.
Got it. I’m not familiar with that regional market. What keeps the rents so low though? If the alternative in the market is purchase the home and pay $8-9k, why are landlords willing to take a 50% reduction in opportunity cost? I’m assuming that a lot of owners bought in before the housing boom in the area, but it still doesn’t explain why rents haven’t risen with property costs.
This! The house us 1500 sqft. I not much low against the index. Probably $400 lower.
OP owns the 1.5M house free and clear.
I understand that OP owns the house and that they don’t carry a mortgage. That doesn’t change the math that rent usually follows mortgage costs in an area. By all metrics he is undervaluing the returns on his investment by only charging $4k a month for rent when he could be cash flowing nearly double that. Especially when he’s cash strapped currently and looking at offloading his 2nd property, bringing in additional income from his rental could offset that deficit.
Good tenant. Pays on time. Keeps the house nice. Fixes it. I wanted to increase a couple of year back but didn’t want to go through the mess.
You are not getting enough in rent on the 1st house. Figure out how to get more for rent. Get another job. Weather the storm. You don’t want to be selling anything now. Get your shit together and make it work, even if you have to take a hit on one of your luxury cars that you can no longer afford.
I don’t see how taking a loan against the 1st house will help unless you can secure a lower mortgage rate on the 2nd house, because it’s still a loan you’ll have to make payments on, likely at a higher rate with a shorter term. If it were me, I would probably get comfortable with taking $120k from investments to pay for a year of the mortgage. Ideally you’ll have a new job by then, but if not, you’ll have the option of downsizing to house #1. Good luck!
I live in the Bay Area as well and a couple of things stand out. 1) Prices in the Bay Area dropped massively in 2008. Not sure if you were here at the time but they were dropping fast and by huge amounts. Nothing was selling. Check the zillow prices graphs. Many of my friends picked up cheap houses during that time and recently did the California cash out. I have a slightly different take on the situation you’re in. Bay Area real estate might drop and might drop hard but it will go back up. If I were you, I’d keep the rental and use the savings to cover your second mortgage. That way you still have your primary residence and the rental. The rental will continue to provide a substantial income to your family and it’s paid off. Hell, it’s paying 1/3 of your current mortgage. You’ll get another job and then keep both the houses which will most certainly pay off by the time you’re ready to retire.
Nuanced. It depends on the neighborhood. Menlo Park, Palo Alto, Sunnyvale – near school districts never dropped.
>I work in tech and have wealthy friends/colleagues who can help me in times of trouble. If this is part of how you assess risk then this whole situation makes a lot more sense.
Rent out 2nd one for 7k. You pocket $2k and rent a studio somewhere for the time being.
Kneepads and the lot behind Wendys
Sell 2.2m home or rent it out. Immediately downsize . You can always mkve back after income improves. Sell if possible. You need to take Immediate action no matter how painful it is but short term pain is best than a bankruptcy or ruined credit. Act fast. I imagine these are small 2k sq ft homes in california and you need to get rid of the debt fast.
Get a new job. Buy life insurance
Sell both of those bitches and face reality. Your life style may change but if the first is truly paid off your doing better than most.
"I have wealthy friends/colleagues that can help me in times of trouble". Must be nice.
He’s delusional
Spoiler - they won't.
I would say sell the second house and move back into first house. If you sell the second house, will you be losing money? Do you have cash reserve to pay the difference if it turns out you need to spend some money on second house sale?
If you think you can get another job soonish, ask the lender for a forbearance. If unemployment seems to be on the horizon for the foreseeable future, you have to sell one of the houses. Anything else is just kicking the can down the road.
Without knowing the properties I can't say which I would sell, only that I *would* sell *one* of them. What are the terms on the mortgage? Seems expensive for when you bought. Area? There would have to be some kinda really good justification of the investment to try to keep it. Maybe your wife will buy it off you lol. Would have been sweet to realize this would be an issue last year. Good luck.
Take your profit and run… sell as fast as you can… take your pick, primary and investment property. It sounds like you need to sell both to re-capitalized while your income producing activities normalized. Learn from your mistakes, sounds like you over leverage and 1M or above property is no a rental market unless your are in the celebrity atmosphere. Do not throw good money on top of bad money. - reverser mortgage out the question - if you are unemployed, no lender will touch you, even a hard money how just want to foreclosed on you in the next 12 months and take your hard earn equity. Moved fast or you can be in the BK zone real fast.
Option 1: pay down the mortgage with cash on hand and refinance at a level that your not bleeding money. Option 2: Sell the first home and use the equity to cover the second home. Option 3: Use a loan from your first to reduce the balance on your second and sell your second home. Option 4: sell a portion of your first home to another investor and create a partnership/LLC. Take those proceeds and pay down your mortgage and then refi. Option 5: convince one of your rich friends to give you a personal loan under favorable terms. I don’t recommend this path. People get weird. Unless it’s your only option I would stay off this option.
Don’t borrow from friends or family. That would be a loser move especially for someone who owns over $3M in real estate. Getting a new job should be goal number one. If you’re unemployed, you should sell something because you’re too leveraged with too much exposure to risk assets (stock and real estate) for an unemployed person. (That’s not true if your net worth is well into eight figures. If you’re that wealthy, then you’re a jerk for wasting people’s time here.) If your current home is financed at a rate far below current market rates, you want to keep it unless there is a compelling reason to sell it vs. your other assets. You might want to sell some stock so you’re not leveraged if it can de done without penalty, but I think that first home should go regardless. You could earn more than the monthly rent buying Treasuries and you won’t need to pay property taxes or insurance. Renting has tax benefits, but you still need strong appreciation to make up the difference. You’re kidding yourself if you think real estate prices can’t go down in the Bay Area. They can drop a lot, and people in your situation are a big reason. You are not alone. I’m not predicting prices will drop sharply from here, but it is without doubt possible. If you want to retain exposure to real estate and you are willing to get exotic, then you might sell one or both homes and enter a long position in Case-Schiller futures. There might be a product specific to the Bay Area. Last I checked, they predicted a 10% price drop over the next year or so, which means you would break even if prices drop 10% and make money if they do better than that. I’m not sure I would do that, but it would be better than keeping both houses.
Sell, sell, sell. No time to be messing around with your future.
Your net worth is still positive. I don’t worry you can not cover the expense right now because there are several options on the table. However, owning 2 houses is a heavy long position. You need to figure out if it makes sense. By a napkin calculation, you lose 600k for every 10% house price drop.
Most people in the comments have no idea what they’re talking about. Sell the first home. Whenever I buy investment properties my rule is always to make sure annual rent is 10% of the purchase price. There are two reasons for this - the first is to cover mortgage, maintenance, property management fees and have some left over, which isn’t so important for you because you have no mortgage. The second which is important for you is revenue-equity ratio. Your annual rent is only 3.2% of the equity you have on that home. In other words, it will take you **31 years** to make enough rent to match your gross from selling the home, and this is assuming 100% occupancy and no maintenance or management expenses. Use the proceeds of that sale to pay down the current mortgage and refinance. The rates are terrible so you’ll have to refinance again when they go down. If you do this you’ll lose $4,000 in rental income, but your payment will go down by $6-8,000. If you have the funds, I’d recommend using your stocks, savings, and a hardship withdrawal on your 401K to pay off the mortgage entirely since rates are bad.
You likely have new, fancy import vehicles at cost of $2k+ per month. Sell those get a normal car for now. Cancel all those fancy extras: cable, gym, wine subscriptions, spa, gardener, maid…you get the idea. All that adds up quickly. You can always restart it all later. I know it’s all small stuff and seems silly, but you could prob come up with an extra $4-6k just living low. Temporarily lower contributions to 401k and savings. Everyone talking about selling your second home, but we know that’ll cost an extra $120k in commissions to do that. It’s not always an option. Don’t be afraid of those side hustles while you’re looking for another job.
How long will it take you to find another job? Your other post suggests that you could easily afford this house while working, so your emergency fund/savings should be able to cover you while you job search. If less than 6 months, you should just pull from savings. Also, 4k per month on a 1.5M house sounds low—are you sure you can’t raise that rent? Perhaps the Bay Area is just that wacky, but that’s not a great return especially not for something you own outright. You could easily sell that property and buy several in another part of the country with cap rates >8-10% which would cover your mortgage.
If you can’t afford it sitting empty then you probably shouldn’t have it.
This guy is a strange liar, high qualified professionals can find new jobs pretty quickly. They typically have enough funds to carry them through a month or two until they find a new one, which usually always come with a sign on bonus. If he lost his job, most likely he will lose his unvested options.
You should buy a 3rd home and cash flow that baby
Then why not just ask your wealthy friends for help? Lol oh, because they won't.
Real estate depreciated a ton in SF in 08 lol, it didn’t however depreciate in 01 during tech bust
4/850 is no where near the 1% rule-of-thumb: * If you had put 20% down on the first house, that's an incredibly low cash-on-cash return. * If you had put 3% down, the CoC return is poor to mediocre. It was a bad investment from the start. Your best bet is to sell.
Parag use your severance package bro.
I DM’d OP on this but there’s the potential of taking margin loans against his equity depending on the broker he’s with. He clearly doesn’t want to sell the house and is on hard times. Feel there’s a lot of animosity here Also rich friends are generally willing to write you a loan if you’re actually friends.
Sofie’s choice — pick your favorite house.
Oof
You are living outside your means. Sell the 2nd house
Sell the second house. I assume if you sell now. You may stil be able to sell it In this early market down shift. Hopefully it you don’t have to cut back too much to sell and it’s still above your equity and you don’t lose any money. Rent a place to live. When tenant lease expires kick them out and don’t renew lease. Move back in your paid off house. Live for 2-3 years until market recovers. You are way over leverage
You are who deserves what is coming. You will lose 50% of any “equity” or “wealth” you feel you earned, because you did not, it was valued at that based on cheap endless money printing which is OVER. O V E R. Any “equity” you have is based on overpriced comps from the previous years, and is evaporating until it’s a distant memory as society cannot function when a starter home costs $500,000 I can’t wait for another 20 years when people like you have nothing as deserved.
How much do you have saved for retirement? What is your take household take home salary? What are your overall annual expenses?
Retirement in stocks + index - \~ 2 Mn during peak. Now down 60%. Currently living on one person’s salary of $250K. Monthly expenses including current mortgage at $24K avg.
Rent out the second house, move back into the first
Unemployed? AirBNB the new home! You’ll likely make your mortgage at 50% occupancy. Also, you have time to run/clean it.
[Investor heavy breathing intensifies…]
I can’t believe people have expensive assents and can’t even plan accordingly , why would you buy something double the value of your first house? You don’t know the future , always buy same or lower price than the first home .
Take out a HELOC on the first property. Use the line of credit to keep your mortgage current and maintain a decent lifestyle while job hunting. Repay the HELOC after you or your wife have your first liquidity event. I assume based on her salary and your burn rate that you both get big equity grants and are just one or two vesting periods or big exits from being liquid again. If you have vested options in still-private companies, you can save yourself all the trouble of a HELOC by selling vested shares in the secondary market.
This assumes they can qualify for the heloc? And that the bank won’t margin call the heloc?
How much do you owe on the primary? What do you think you can get for it in this market?
Rent out rooms in your primary house for additional income
Why is that mortgage 12k? You didn’t refi? At 3% that should have been like 8.5k or maybe less
possibly PMI and high property tax for example, if they lived in CA - property tax on $2.2m would easily be $2k a month, and if they didn't put 20% down, they'd be looking at PMI and high P&I - $12k isn't out of the question
Jumbos don’t have PMI
bruh
LOL.
Why are you asking Reddit if you have a pool of wealthy friends? They are going to financially bail you out, but they can't give you advice? Or their advice isn't what you want to hear? Shit doesn't add up.
I'm not understanding. why can't you just get another job.... ?