House is being sold out from under me last year of fellowship.

[stayathomemad]

My wife is currently finishing her fellowship at Johns Hopkins and the people that own our house are selling it out from under us even though we have a 3 year lease with them.  They have offered us the right to buy the house at what they owe on the mortgage ($277,000) so that they dont have to go through a real estate company and list it at 300k or more.  The value of the house is probably around 310k if not a little more with real estate prices increasing in our area of Upper Fells Point.

Here's where it gets tricky.

1.My son was just diagnosed with type b leukemia and is getting experimental treatments at Hopkins and I would like to have a solid continuation of care.

2. My wife will likely be offered a position here and has already gotten the approval of 2/3 of the people that have to approve but they still require you to apply at other hospitals.  Since this is not 100% I am wary or everything but I'm pretty sure we could sell the house for what we bought it for depending on who is paying closing costs.

3. The rent on an apartment within reach of Johns Hopkins that would comfortably fit a 4 person household is as mush or more then a mortgage payment.  We were getting a deal on the house we were currently in at 1600 a month where almost any other comperable house would be 2-2.8k.  We cant move farther than walking distance since we only have one car and she takes calls and I need to have a vehicle if something happens to my child with leukemia.  That kind of rent will break us.

4. 2016 has been a bad year so far.

 

I would appreciate any input if anyone has any.

 

Thank You

Baltimore Dad

[Docbeans]

I'm afraid I do not have the answer to your question but I just wanted to say how sorry I am that you and your family are going through this rough phase! I hope someone here will be able to help. You could also try asking on biggerpockets.com forum, which is a site for real estate investing and there are many real estate attorneys on there. All the very best!

[jfoxcpacfp]

It sounds as if the house is the way to go, given the fact pattern. Could you provide information on the purchase? Do you have a downpayment? Are you prequalified for a loan? Seller-financed?

So sorry you have this dropped on top of you while you are coping with your son's illness. That puts a lot of minor worries in perspective.

[joehospitalist]

Baltimore Dad,

My heart goes out to you and your family with this situation.  My wife and I live in Fells Point as well.  I think the situation with buying the house makes a lot of sense for several reasons you described.  Your wife could probably make more money as an attending at other places than JHH, but I agree with you with keeping your son's care local.  Moving to the suburbs would save some money, but then she'd have to deal with a long commute, and you have the one car as well.  Lastly, 277k mortgage is pretty good for the area.  Good luck with everything, and I hope it works out.

 

 

[The White Coat Investor]

Sorry to hear about your situation. What does your 3 year contract say the penalty is if they break the contract?

[stayathomemad]

Thank you for so many replies.  I actually got my wife to look over the site and after some deliberation we are thinking being conservative.  Personally I think that this isn't a bad deal but with everything else in the air I think this might cost us a decent chunk of change if everything goes the way everything else has gone for this inglorious year of 2016.

Here is a thought.  Our landlords are friends that are still underwater with this house.  They want to sell it to us because they might lose their job soon and don't want to be foreclosed on by the bank just have a bad day in general.  We have an iron clad lease that coincides with my wifes graduation and keeps us in a good position in case we move or want to get into a nicer house.  Unfortunately I am not a jerk.  Maybe this should be a thread about not mixing business with friendships.  The deal is still on the table but at the same time we are thinking about paying the actual mortgage they are paying which would up our rent by from 1700 to 2300+ a month.  The cost involved with moving and upfront rentals a factor.

 

What a mess,

Stayathomemad

 

[Marko-ER]

Another thing to consider:  what's the house worth?  Have a good (emphasis on good) realtor do very careful comps.  If the comps come through at above the value that is owned & you enjoy living in Fells, then think about the purchase.  Also know yourself:  can you hardball your friends/landlords?  The real estate in B-more tanked a bit around the riots, especially around places that were affected by the riots (& Fells point around Broadway certainly was).  That plus their precarious situation can be your leverage.  So, if you can get the house for 10-20% less than comps & assesment, then definitely think about it.  And just because they want to get what they owe, does not meet they would not settle for going "into the red" a little bit.  Also, remember there are hidden costs to owning a house (most houses around the harbor are quite old), plus other expenses:  are your kids close to school age -- Baltimore public schools are a no-go, you will probably have to go private.  Plus as mentioned elsewhere, the prestige of Hopkins carries a price:  20-30% lower salary than other academic places nearby or 30-50% less than private practice.  However, since your wife is just post-training, she may be able to take it for a couple of years, build up a strong reputation and either moonlight/freelance or cash in on the reputation after your kid recovers.  Good luck with a difficult choice.  Also being a hard negotiator != being a jerk.