The San Francisco Gate writes that more and more divorced couples are forced to live together while trying to sell their home. People can’t sell their homes, leading to a real-life version of the Jennifer Anison/Vince Vaughn movie, The Break-Up.
It’s not just that there are too many sellers and few buyers, it’s that people have bought more home than they could afford. As housing values dropped, they have found that they owe the bank more than the home is worth. In order to leave they are going to have to dip into their savings to pay the bank the difference.
A number of other sticky situations can occur. The articles asks, what happens if “one person wants to sell at all cost and the other wants to hold the house until the real estate market rebounds?” It’s put divorce judges in a pickle – they can’t order the sale of the home like they might have in the past.
Articles like these remind me how it is the possessions that own you. While a home is one of the better possessions you can buy, it’s odd that it can turn into a jail. It’s another reason why having money isn’t always about the money, but about the freedom of choice is allows.
My wife and I are starting to look for a new place and our thoughts are to keep the price so that either one of us could pay the mortgage and the bills. We’re not thinking about divorce (and hopefully never will) but there will be times when a job might be lost which could have just as disastrous effect.
I’m always amazed at all the people who put themselves into financial hot water by spending more money than they can possibly make.
Saving Freak says
The problem here is that people consider divorce an option. I have a great relationship with my wife and work to keep it that way, but I made a vow and plan to keep it.
From a strictly financial stand point divorce doesn’t add up. A much better investment would be some marriage counseling. Getting divorced just ruins your finances and makes you miserable. The divorce rate being so high is one reason we have so many people in poor financial situations.
Dividend growth investor says
Statistically divorce could happen to everybody at any time for whatever reason. but one could always work their way out of getting one by marrying the right person.. If it doesn’t work the first time, there’s always a second chance you will meet the one..
I am seeing some couple in divorces that are just walking away. Bad news for everyone.
This happened to my parents a couple of years ago. They put the family home on the market and it took months to sell. I’m fortunate that I didn’t have to live there through it, but a couple of my siblings were in the house for the whole thing. This is, of course after they has spent a long time (like a couple of years) deciding whether or not to call it a day.
I know how this is very well right. I can now tel you that getting divorces is no fun :( And money/house problems don’t help
Maria @ Financial-Tip says
I know someone who is 21, and about to buy a house with her boyfriend (although he has a ton of debt and they have little savings). It is stupid on many levels. The chances of them staying together long term are low, and yet they’ll be forced to stay together if they can’t sell the house. I don’t understand why people make these kinds of decisions.
Not all of us bought more house than we could afford. My husband and I purchased a home and the market bottomed out — that is NO fault of our own. How were we to know? We now owe more than the house is worth and I found out last month that he is having an affair.
Now I am stuck with an unfaithful spouse, three children and a mortgage. Not all of us are walking away and contributing to the mortgage crisis.
But some of us DO feel hopeless. I don’t want to ruin my credit by letting the house foreclose(which would also cause me to lose my job) — but I don’t want to be forced to live with this man who broke my heart.
Any suggestions would be greatly appreciated.
Chris RT says
I’m in the same situation as Kim (except no one was unfaithful, just stuck in a dead marriage because of upside-down mortgage). My wife and I bought what we could afford as a standard 30-year loan 3 years ago. We live in Florida where the market dropped about 40%, and now it will take us 10 years or more just to pay down the mortgage to what the house is worth.
Amber F says
Wow in regards to Kims situation: That is very sad, and for you to still stay and take care of your job, children, mortgage and stay with a person who betrayed your marriage, is a lot of will power. Possibly rent out your home to keep up with the payments that you owe, to appease a steady progress, and then have a second home for yourself that is payed with the job that needs a good credit score. Split ways with the husband. Maybe make a deal wit him to help keep up the house with renters.