Need advice- dad selling primary to pay off debt
My dad (61 y.o.) currently lives in our childhood home and has been struggling to find a job. He managed afterschool programs for a majority of his career making between 60k-120k/year, but was recently laid off. Over the years, he's accumulated about 500k in debt from cc's and borrowing from family. The mortgage payment, living expenses, debt, and inability to find a job has been weighing on him and he's deciding to sell his home so that he can:
- pay off his debt
- live without worrying about mortgage payments (by buying a cheaper house all cash)
Unfortunately house-hacking is not an option. Before jumping the gun, I want to make sure that selling is the smartest decision especially since his monthly mortgage payment is low and he has ~1.2m in equity in the house. What's the best way to pay off his debt while keeping the house? Current childhood home:
- 485k mortgage left on home in the East Bay of California
- ~3k monthly mortgage payment
- Valued @ ~1.6m-1.7m
His plan is to use his profits after selling, paying off debt and capital gains tax, and buy a 500k house. What is the best move he can make for long-term financial stability, especially considering that he may not be able to find a good job again?
Most Popular Reply
@Melody Tay
Why not look into a reverse mortgage if he has that much equity?
That is what I would recommend - that way he doesn’t have to move, pay any taxes on sale….
- Chris Seveney
