Looking for advice. Lost my home due to divorce. Starting over !!

Member since 2022 · 1 post · 3 votes

Current situation... Fresh off a divorce. Have a pension I can't touch. 90k in a 403 b I can't touch. Have around 40k in my savings. 830 credit score. Make around 75k a year. Don't own my home anymore due to divorce. Thinking of buying a 2 family to start over with. Live on one side rent other side out. Do this for 2+ years and then hopefully buy a single family home and keep the 2 family as a long term investment. Any advice?

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Nathan GesnerBusiness Member

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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes

Quote from @Kenneth Young:

If I were single again, I would sell all my crap and buy a nice fourplex. Live the apartment life and rent the other three out. Do it again as soon as the lender allows. Get at least two fourplexes that are cash flowing enough to pay for themselves and a single-family for myself.

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Greg ScottPro Member
Rental Property Investor · SE Michigan · Member since 2014 · 4k+ posts · 6k+ votes
4y
Bummer. Been there, done that.

You have great credit, good income, and probably more resources than you may think. I believe you can borrow from your 403b up to $45K. That plus your savings should allow you to get into a duplex. See if you can get an FHA loan to minimize your downpayment and maximize liquidity.

Good luck
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Nathan GesnerBusiness Member
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
4y
Quote from @Kenneth Young:

Current situation... Fresh off a divorce. Have a pension I can't touch. 90k in a 403 b I can't touch. Have around 40k in my savings. 830 credit score. Make around 75k a year. Don't own my home anymore due to divorce. Thinking of buying a 2 family to start over with. Live on one side rent other side out. Do this for 2+ years and then hopefully buy a single family home and keep the 2 family as a long term investment. Any advice?

If I were single again, I would sell all my crap and buy a nice fourplex. Live the apartment life and rent the other three out. Do it again as soon as the lender allows. Get at least two fourplexes that are cash flowing enough to pay for themselves and a single-family for myself.
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Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votes
4y
I think you have a good plan. Don't touch your retirement money, use some of your savings for the down payment. When you run the numbers, do it as if you were renting both sides and hopefully your living costs go down.
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Terry Miller
Akron, OH · Member since 2015 · 178 posts · 189 votes
4y
Quote from @Kenneth Young:

Current situation... Fresh off a divorce. Have a pension I can't touch. 90k in a 403 b I can't touch. Have around 40k in my savings. 830 credit score. Make around 75k a year. Don't own my home anymore due to divorce. Thinking of buying a 2 family to start over with. Live on one side rent other side out. Do this for 2+ years and then hopefully buy a single family home and keep the 2 family as a long term investment. Any advice?

I was a little sad when I read the title. But as I read the first few sentences, I got happy for you. You still have an excellent credit score and $40,000 in the bank after a divorce? You won already.

That house hack sounds like an excellent plan for your situation.

The post that talks about borrowing against your 403b is a great thing to look into.

I wish you well.
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Bruce WoodruffPro Member
Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
4y
Sorry for your troubles, the house hack plan sounds good. My divorce cost me my house, business and put me in BK court. It sucks, but you'll look back at laugh. Keep your head up......
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Scott Mac
Austin, TX · Member since 2019 · 5k+ posts · 5k+ votes
4y
Hi Kenneth,
Yes, but when renting--make "Business Decisions' about who will rent unit #2.
What I mean is don't just accept someone because she is a "Hot Cha Cha" (you know what I mean).
Keep your "Business Life" separate from your personal life--because it will most likely cause you business troubles if you don't.
Pick you renters according to a predetermined plan (look in this forum for ways others do this) and vet them properly--they are going to have pay the mortgage with you.
Also in a duplex the two sides must get along.
If you sleep all day and apt #2 practices the tuba all day...Ouch.
Just my 2 cents.
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Scott Mac
Austin, TX · Member since 2019 · 5k+ posts · 5k+ votes
4y
Quote from @Bruce Woodruff:

Sorry for your troubles, the house hack plan sounds good. My divorce cost me my house, business and put me in BK court. It sucks, but you'll look back at laugh. Keep your head up......

So many outcomes like that over forever years, makes me think it is set up purposely to do that.
And no one tries to fix it so it works better (for those involved).
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Joshua MessingerBusiness Member
Property Manager · Poconos, PA · Member since 2020 · 443 posts · 264 votes
4y
Hey @Kenneth Young!
I would go the house hacking route since it seems like the best move for the situation you are in. Keep your head up and don't let anything ever hold you back!
If you ever need anything please don't hesitate to reach out!
Best of wishes,
Josh
[email protected]484-986-5012
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Natalie Schanne
Real Estate Agent · Princeton, NJ · Member since 2016 · 1k+ posts · 1k+ votes
4y
@Kenneth Young - definitely chat with a lender. You may still be on the mortgage of the house (if not sold) if you gave it over during a settlement, and that may restrict your ability to borrow. It wasn’t clear to me what situation you have. I was thinking that a lot of single moms keep the house and pay the mortgage even though they couldn’t qualify for the mortgage (or to refinance it) on their own.
If you can qualify for a loan and numbers work, definitely house hack instead of renting. I find the cashflow numbers are MUCH better for a single family like 4-6 bedrooms, 2-3 baths, than a duplex with two 1/1 apartments, however sometimes it doesn’t work as well to keep as a long term investment. Like +1000/mo vs -$1000/mo (when assuming your stay is free)
If you are not in a position to invest right now, that’s also ok. You can choose to live in someone else’s house in a private room for $500-1000/mo (about half of the net cost of a single apartment) while you save up reserves and pay down debts. There will be property opportunities coming down the pipeline since the foreclosures are starting to work their way through the system.
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