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Old 04-10-2013, 05:36 PM   #61
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With a bigger house comes more maintenance, property taxes, and insurance. If you are not uncomfortable where you are I would ask grandma to put that money in a 529 college savings plan for your children.

Only she knows the amount of your mortgage (unless you told her). If you can find a better house without spending all of her 'gift' in addition to the sale cost of your house it might work, in effect she would be helping to pay down your mortgage. Remember, today's dream house is tomorrow's dated abode -those of us who purchased our first home in the 1970s can attest to that.

If there is any hint that if she gives you this money she expects to live with you in her final days.. don't do that. You may want her to live with you then but don't accept the money with that arrangement because it isn't a gift.
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Old 04-11-2013, 08:09 AM   #62
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Oh, geez, $150k income and $850k house or even $625K house would scare the heck out of me. How secure is your job or how easily could you find another one with the same or better salary in case you're laid off?

I'm super concervative though

To be honest, I really don't like such strings. If she were a millionaire-next-door type grandma she'd really understand how her $100k give would help you with getting ahead for your ER in case you're interested. What about $100k for your children's college fund?
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Old 08-21-2013, 06:15 PM   #63
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As an update, we did decide to build the house. Three positives happened in May, 1) I received a significant raise (15%) at work, 2) I had the opportunity to make an additional $60,000 doing a free lance project this summer and 3) Our townhouse sold for $20K more than we expected... which brings our mortgage under the jumbo conforming (we locked 4.25% on a 30 years fixed). We're still financing 75% (or about $615K).

So far the neighborhood is doing exceptionally well and we can't wait to move in. Seems everyone on our street (we're on a side cul de sak with 14 homes total) has kids. So far my wife has confirmed 25 kids under the age of 8, 18 of which are girls (we have two girls ages 1 and 4).

Builder has raised home prices significantly this spring. Our base model is selling for about 10% more than we signed for. Guessing our home will continue to rise as the development progresses since we're early into the community and the homes going in after us are larger. (fwiw, HOA is already established and dictates rules to builder... unlike most communities where the builder builds and then hands over to HOA - because of this we have a very unique neighborhood... lots of open spaces, amenities, farms, gardens, larger lots, etc... rare for DC suburbs). Still need to watch the desire to 'keep up with the Jones' but that has never been a problem for my wife and I. We're certainly moving into a neighborhood where everyone is doing well for themselves. We chose the location for the community.

We'll have an emergency fund still in the $60,000 range, and 401K just crossed $200K, with our home equity somewhere in the quarter million range.

Adding that all up we're close to equal on the debt to wealth line. We plan to stay in this house until kids are out of college (20 + years)... and don't anticipate ever needing to refinance and don't want to touch HELOC.

Because of the raise in May we didn't need to make any changes to our budget. Conveniently, the higher mortgage payments match the raise received...

Still no regrets, we'll see how that ends up. I'm anticipating this being a good financial move in the long run. Of course we could have chosen a smaller home in another development, but I'm not sure we'd have the same quality of life raising our kids (I'm aware that could be a biased opinion based on my desire to believe this is a good choice). That said, I doubt this home will stay under $1 million for long (sale price was $840K and the same sq footage is going for around $900K now. A few years from now I'm anticipating our mortgage to be half the value of the home. That depends on the market...

(most importantly, we left Grandma out of the equation)
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Old 08-26-2013, 12:59 PM   #64
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Thanks for the update. Many people ask questions, receive lots of detailed advice, and then disappear from the forum altogether. It was courteous of you to provide a status report.

Quote:
Originally Posted by EvrClrx311 View Post
most importantly, we left Grandma out of the equation
Glad to hear it!
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Old 08-26-2013, 04:25 PM   #65
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Quote:
Originally Posted by EvrClrx311 View Post
As an update, we did decide to build the house. Three positives happened in May, 1) I received a significant raise (15%) at work, 2) I had the opportunity to make an additional $60,000 doing a free lance project this summer and 3) Our townhouse sold for $20K more than we expected... which brings our mortgage under the jumbo conforming (we locked 4.25% on a 30 years fixed). We're still financing 75% (or about $615K).

So far the neighborhood is doing exceptionally well and we can't wait to move in. Seems everyone on our street (we're on a side cul de sak with 14 homes total) has kids. So far my wife has confirmed 25 kids under the age of 8, 18 of which are girls (we have two girls ages 1 and 4).

Builder has raised home prices significantly this spring. Our base model is selling for about 10% more than we signed for. Guessing our home will continue to rise as the development progresses since we're early into the community and the homes going in after us are larger. (fwiw, HOA is already established and dictates rules to builder... unlike most communities where the builder builds and then hands over to HOA - because of this we have a very unique neighborhood... lots of open spaces, amenities, farms, gardens, larger lots, etc... rare for DC suburbs). Still need to watch the desire to 'keep up with the Jones' but that has never been a problem for my wife and I. We're certainly moving into a neighborhood where everyone is doing well for themselves. We chose the location for the community.

We'll have an emergency fund still in the $60,000 range, and 401K just crossed $200K, with our home equity somewhere in the quarter million range.

Adding that all up we're close to equal on the debt to wealth line. We plan to stay in this house until kids are out of college (20 + years)... and don't anticipate ever needing to refinance and don't want to touch HELOC.

Because of the raise in May we didn't need to make any changes to our budget. Conveniently, the higher mortgage payments match the raise received...

Still no regrets, we'll see how that ends up. I'm anticipating this being a good financial move in the long run. Of course we could have chosen a smaller home in another development, but I'm not sure we'd have the same quality of life raising our kids (I'm aware that could be a biased opinion based on my desire to believe this is a good choice). That said, I doubt this home will stay under $1 million for long (sale price was $840K and the same sq footage is going for around $900K now. A few years from now I'm anticipating our mortgage to be half the value of the home. That depends on the market...

(most importantly, we left Grandma out of the equation)
Congratulations, this should all work out very well.

Ha
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Old 08-26-2013, 04:54 PM   #66
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How sweet it is!!
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Old 08-26-2013, 05:12 PM   #67
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Evrclrx311, your kids are going to have a lovely childhood and nice memories in their new house in the new neighborhood. Can't put a price on that.
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Old 08-27-2013, 01:50 AM   #68
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Congratulations.
Just wondering: did the old lady not follow up on her offer or did you turn her offer down?
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