Crap! Owning 2 Houses...

Lisa50 · February 2011

Ugh! FI's house is back on the market (2nd time in less than a year), in hopes that he can get rid of it before the wedding. Actually, I could deal with being a landlord (I've done it before); he does not want "the hassle." I noticed, on the "Intros, please ..." post that Donna posted the following:

Next major project to tackle? We still own two houses. The market hasn't exactly been good for selling houses like ours, so we have sat on them. We need to get our butts in gear and sell both of them (now that DS is essentially our of HS) and move closer to our jobs. ~Donna

Who else is in this position? How have you handled it? What are your plans? BTW, what does "HS" mean?

handfast4me · February 2011

HS means high school maybe?

We don't own two houses yet, but we've just started looking for a home to buy for our retirement (I'm eligible in 5 years). So, if we find the mountain property we're looking for that means that we'll own two until we either sell our house in the city or we could rent it for a bit. I bought it just after we started dating, so I will be happy if we can get out of the whole thing without having to write check to the bank.

MikesAngie · February 2011

Eeks... we just have the one house and a time share (both my FI's). My xH could afford the house easier than I could so he got to keep it and just about everything in it (long story). Keep us posted as to how it goes.

right1thistime · February 2011

Lisa - two houses AND a share of his family's beach house. We'd like to get down to one house and the beach house.
And yes, HS is high school. God forbid you move a teenager in the middle of high school. ~Donna

tropical.dreams · February 2011

My house is the bane of my existance at the moment.

My house is in Ohio, his is in Texas, and essentially, I cannot only not sell mine for enough to pay the mortgage off (let alone the realtor fees), but because I got the first time homebuyer's tax credit and I'm moving within 3 years, I'm going to have to pay that back. Yes, even if I don't sell it, and just rent it out, because it will cease to be my primary residence.

I have the nicest house in the neighborhood, and the house 2 doors down from me is on the market for 20% less than what I owe. In my neighborhood, I won't be able to rent it for enough to cover the mortgage, so I'm going to have to take a loss each month until I can sell it. It blows.

Had I known when I bought the house that I'd be getting married and moving out of state, I never would have bought it.

thealphabride · February 2011

We also own 2 homes. We have been still living apart since the marriage since we are going to rent out my house and we are remodeling both bathrooms and going to do some other small improvements before we rent it out ...The hubby is doing all of the work and it is slow going because he works full time and has an hour commute each way.

We are hoping to move in together and rent out my house before the next school year starts. We have been living apart and it works for us. We still see each other 4-5 nights per week. We are very much looking forward to living together .. When we move into his home, my son will still go to the same HS. His son will be off to the first year in college.

OK for those of you who are asking WHY get married if you are going to live apart?

We saved 3 K yearly on our health ins. (the savings went into our 401K) and 1K on our homeowners, and about 500 on the cars. We came out ahead on taxes because I was able to file "Head of Household" and the IRS considers me unmarried, since I live in my home with my son, and I am filing separately. He gets money back filing married separately.

I would be interested to know what the tax situation is with the fed when you rent a house. DOES ANYONE HAVE INSIGHT ON THAT FOR ME?

Lisa50 · February 2011

Oh my goodness ... we (those of us with multiple residences) are in a heck of a mess, aren't we? Sheesh!

I am crossing my fingers, hoping FI gets some good nibbles on the house. As I mentioned in the OP, I'd be okay with keeping his place and renting it out. We'd likely take a loss of about $300 or so, which we could handle. We'll see.

I wish each and every one of you the best on this. And this is yet another reason I don't have the time or notion to worry about shite like tears of joy packets. Good Lord, the real world beckons -- 24/7!

Hang in there, ladies!

@thealphabride: I don't know what the tax situation is in the instance of renting a house. Do you mean as a landlord? I took the loss (mortgage minus rent charged) and all expenses related to the house as deductions (from what I can remember) when I rented out my previous home. Is that what you mean? Sorry if I'm answering the wrong question.

right1thistime · February 2011

No clue about the tax stuff, alpha. We don't rent either house. And our accountant has us filing jointly, AND it hit us wicked hard that first year we were married. As HOH, I always got back quite a bit, and once we filed jointly (she showed us the calculations both ways-- so we wouldn't have done better filing seperately) we paid out so much. I looked at him and said, "What exactly was the benefit of getting married?"

Our two houses are on the same street, with one house between us (that is how we met). So we are enjoying couple time doing things like snow shoveling, roof raking, ice dam chopping, etc. In the summer its lawn mowing, weed pulling, brush burning. Boy are we living the life, huh?

The GOOD thing about the second house is that when we need a teenager free zone-- we head over to his house, LOL. ~Donna

Sue-n-Kevin · February 2011

OMG, so glad to not be the only one dealing with this!

We will be living in my house once we are married. The market really tanked at the wrong time, and because my fiance had to re-mortgage years ago in order to pay off his ex-wife to get out of the marriage, his house's mortgage is more than the value of the home so selling is out of the question. We (really, I) fixed up the 2 bathrooms and kitchen in the past 2 years, to try to make it more marketable once the market gets better.

However, because his dear teenaged daughter got pregnant last year and had a baby, and is just a HS graduate, and needs a place to live, (she is NOT living with us) we will have 2 mortgages and have to figure out the tax implications. He won't be getting any rent from her because baby's daddy is "on and off" with his daughter, so doubt he'll be living there. It's 40 miles away from my house, and he'll have to pay all the utilities and mortgage until everything sorts itself out. I re-financed last year and have a much lower mortgage payment than he does.

I've always done my own taxes, but next year we may have to talk to a tax specialist to find out our options. I may even use someone this year to get the skinny before we are screwed next year.

This sucks!

tropical.dreams · February 2011

In Response to <a href="http://forums.theknot.com/Sites/theknot/Pages/Main.aspx/special-topic-wedding-boards_second-weddings_crap-owning-2-houses?plckFindPostKey=Cat:Special Topic Wedding BoardsForum:35Discussion:6d1a77a7-67d0-41c4-93a5-81b2fb2384c8Post:6a4c4820-372c-4385-a775-a1031c52bedb">Re: Crap! Owning 2 Houses...</a>:
[QUOTE] And this is yet another reason I don't have the time or notion to worry about shite like tears of joy packets. Good Lord, the real world beckons -- 24/7! Posted by Lisa50[/QUOTE]

BEST QUOTE EVER.

This is why I slink around the boards telling stressed out brides to be to calm the hell down when they can't decide between baby blue and robins egg blue and it's the END OF THE WORLD!

Lisa50 · February 2011

In Response to <a href="http://forums.theknot.com/Sites/theknot/Pages/Main.aspx/special-topic-wedding-boards_second-weddings_crap-owning-2-houses?plckFindPostKey=Cat:Special Topic Wedding BoardsForum:35Discussion:6d1a77a7-67d0-41c4-93a5-81b2fb2384c8Post:4cbf2e0a-85f7-4e90-a799-5f8a2fee916c">Re: Crap! Owning 2 Houses...</a>:
[QUOTE]In Response to Re: Crap! Owning 2 Houses... : BEST QUOTE EVER. This is why I slink around the boards telling stressed out brides to be to calm the hell down when they can't decide between baby blue and robins egg blue and it's the END OF THE WORLD!
Posted by tropical.dreams[/QUOTE]

Thanks, tropical dreams. No lie, huh? I <em>wish</em> my biggest concern was something like a flippin' color scheme.

Yeah, this two houses/two mortgages thing has had me on the edge. I would not be so stressed if I'd not lost my job 18 months ago -- ugh. Reserves are running low and we need to have one mortgage (or tenants in his place) by June.

Keep reminding <u>me</u> to calm the hell down. Please. Let's hang in there, ladies!!

tropical.dreams · February 2011

Yeah, Lisa, I'm stressed to the MAX about leaving my house here :-( My mortgage is twice what his is (luckily he owns his 5 acres of land outright, which makes his mortgage way less than anyone else around him), and I'll be taking a paycut to move there since it's a much smaller city (IF I can find a job quickly). He says we'll be fine since he brings in extra money on his side job, even if we don't rent it out and have to cover the whole mortgage, but I'd rather spend all that extra money on the wedding, honeymoon, vacations, and saving for the new house we're going to build once his is paid off in 5 years.

[Deleted User] · February 2011

I absolutely love this board (people with real problems).

Alphabride: I'm also not sure if I'm answering your question, but the income from the rented house is absolutely taxable income.

Right1thistime: I so identify with your situation. As a single woman, I was getting a nice chunk back from the IRS. Now that we're filing jointly, WE'RE getting hardly anything because we have to pay taxes on that rental income, and he would like me to have more taken out of my check to cover that extra "income." Also first day back to work after getting married, I put husband on my medical/dental insurance, and my contribution then doubled, and, of course, didn't want to wait on this one because husband lost filling from tooth at our reception dinner.

thealphabride · February 2011

Thanks for the responses... yes we live in the real world.

We're not worried about the small details of the wedding but we are focused on the MARRIAGE and the LIFE after the wedding. That's the difference between we "experienced" brides and the young newbies.

We decided to rent my place out because in the Chicagoland area the rental market is really good, and as you know, the housing market sucks. I'm not upside down in the mortgage, but won't make a profit if I sell. I really want to just hang on to both our houses until the market improves or until we retire so we can make a profit when we sell. If the market goes on an upswing we may reconsider selling one or both houses. For the time being we are living well within our means and I want to keep it that way......

We did our own taxes with TURBO TAX, we tried them both ways joint and separately and came out WAY AHEAD separately...filing joint we had to pay,
filing separately, we actually broke even. My hubby thinks if we rent for less we can take all the deductions and a loss if we rent for less than the mortgage as Lisa mentioned she did.

We are going to check it out.....

THANKS LADIES !!! For the responses about the tax situation if renting....

thealphabride · February 2011

I wish each and every one of you the best on this. And this is yet another reason I don't have the time or notion to worry about shite like tears of joy packets. Good Lord, the real world beckons -- 24/7!

AMEN LISA!!!!!

This is why I slink around the boards telling stressed out brides to be to calm the hell down when they can't decide between baby blue and robins egg blue and it's the END OF THE WORLD!

Thanks Tropical for the belly laugh.....!!!!!

@ ALEX's mom
I know the rental funds are counted as income, but I was wondering if we rent for about 300 less than the mortgage can we write that money off as a loss... THAT is what we are going to investigate. Thanks for the advice!!!

Sue-n-Kevin · February 2011

FYI, I just checked the IRS.gov website. There are several topics on rental & sale of homes, etc. Actually pretty good if you just do a "search".

Our issue is that my fiance's daughter, who is a dependent along with HER infant daughter are living there and paying no rent because she has no job and will be going to school. Even if Kevin is not living there, but supplying it to a dependent, we need to find out if that can be his primary residence if we file married-separate next year. Of course only a tax specialist can tell us this.

This is why I slink around the boards telling stressed out brides to be to calm the hell down when they can't decide between baby blue and robins egg blue and it's the END OF THE WORLD!

Tropical.Dream, I stopped telling anyone anything about their weddings long ago. I need to save my typing time for the boards where I can really help.

hsbstone · February 2011

Lisa, we live in the same area and I am in the same situation. FI and I own two townhouse in Mont.County and he is moving to my house once is bigger, has fire places and is close to three metro stations (but it's also a lot more expensive than his). On top of having to merge his stuff to my place (he is a rat pack), we still have to go through this decision. FI is not very friend of the idea of selling his house for about almost the same amount the he still owes to the bank, so I think that we will rent it for while.
We will sell my house in a near future as well once we want to buy a SFH " ranch style" because I have some problems in my knee since I had a surgery and some times it bothers me a lot going up and down on the stairs.

I don't know a thing about tax on rental places here because I just own one house here, but in Italy the taxation is heavy, unless you have inherited it from family, when they give you a little break. I suppose here is about the same. We had decided to file taxes separately because this will be better in our case, following the accountant advices. I think that each case can be different and could be better one way or another, due to its own peculiarities.

Lisa, please let me know how the selling process is going on; who knows it can motivate FI towards this direction???

thealphabride · February 2011

From Sue:
"Our issue is that my fiance's daughter, who is a dependent along with HER infant daughter are living there and paying no rent because she has no job and will be going to school. Even if Kevin is not living there, but supplying it to a dependent, we need to find out if that can be his primary residence if we file married-separate next year. Of course only a tax specialist can tell us this".

Hey Sue!
When we investigated this the IRS site said in order for me to file "Head of Household" (which is a filing status same as married or single) that I had to be living in my house on the last day of the year and have dependents. It didn't matter if married or single I guess.

I did indicate on my return that I was married and used my new name on the return.

My husband filed married and separate and came out ahead, he gets money back from Fed and State. I owe about the same as he gets back so we break even.

Lisa50 · February 2011

@hsbstone: I just wrote a somewhat long and thoughtful reply to your questions, hit something on the keyboard and lost it. Booo! So, here's the shortened version ...

If you and FI can hang on to his place until a good, reliable tenant can help pay down the mortgage and prices get better, I say hold on to it. I have been a landlord and can say they real key is getting a really good tenant. It was worth it to me to have a property mgt firm run credit checks, get references, etc. The one time I didn't, I ran into trouble. Lesson learned.

I don't know what to say about your FI being a pack rat. Thankfully, my FI is all about scaling back. He's already talking about how, in the future, we'll be living in a condo. But, one step at a time. I would hope you don't get in the position of having too many "things" in your home. I have to begin thinking of what to haul out of my house (permanently) in preparation for FI to move in. Dun, dun, dun ...

I hope that helps!

hottiehaas · February 2011

Oh My! I am so there with all of you! Both FI & I own our own homes. He is going to have his adult daughter stay at his house and rent it from us. We will still have to put somethinginto the morgage as she doens't have enough income even with a roommate to pay the mortgage and taxes and still live!

We live in the same area within 4 blocks of one another. He works at the church and school between the blocks that separates our houses. We met through mutal family and friends.

We would love to sell both houses but I owe way too much and don't think I would recoup that money...... about $10,000. over what I think the market would allow me to sell for. We did just talk tonight about selling his house in time and keeping my house. We could do the remodeling we want and make this a doable house to live in. My kids go to school nearby and I think someone above mentioned HS. Yep I have two of those living here!

This is a tough market to sell in and I to wish all of you luck on selling your homes. It doesn't look easy!

Beth

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