I believe that I did the right thing, but it is still tearing me up. I feel a need to lay it out and get some opinions.
My 28 year old son is all in all a great kid. Adopted at 2 months old, he has always been a joy to be around. Even in the teenage years we never lost communications and I never got "stupid." He still calls me almost every day, to talk sports, the grandchild, and anything else on his mind. Although not asking for advice outright, he is always feeling out my opinion about various subjects and situations.
Married with a 13 month old son, he recently took a contract on his house. It is a starter house in a neighborhood in transition that is becoming a not so desirable place to live. I am delighted to see them getting out of there. He is making $12,000 on this house and is using this as a down payment on another, higher priced house he has signed a contract on, in a better school district. The new house will be a financial stretch for him and his wife, but I think they can do it.
All was well until he called me today and told me that his buyer has backed out because the lender has raised his quoted finance rate. My son's wife "really has her heart set" on the new house, according to him. He told me that his first payment on the new house would not be until November, so he wants to go ahead and buy it and move in, counting on selling his old house before then. All he needs is $8,000 from me for the minimum down payment, which he will pay back to me once his old house sells.
Now, I grew up in a Southern cotton mill family where we kept the Great Depression going as a tradition long after it was over everywhere else. Financially, the experience made me ultra-conservative. My son, who has never known any real financial hardship, is a "damn the torpedoes, full speed ahead" kind of person. I proceeded to explain to him that although we both knew that I had the $8,000, I forsaw trouble here. If he was still setting on his old house next January of February, knowing that he couldn't carry two payments for long, he could be faced with either defaulting and ruining his credit rating or having to reduce his price for a quick sale, perhaps losing the $12,000 he is counting on, or even more. He really didn't want to hear this advice, but I told him that when he asked someone for that kind of money, their advice and involvement came as part of the package.
I finally told him that, bottom line, I would not feel right about helping him put himself into such a precarious situation, that he probably should cancel his new house contract (the earnest money received and forfeited would be a wash) or try to get a contingency contract on it.
In reality, I would never feel the loss of $8,000. I have the resources to bail him out even if my worst-case scenario came about. But, dang it, sooner or later he has to stand on his own two feet, make some responsible decisions, and even learn to live with deferred expectations if necessary. I am a firm believer that the fastest way to ruin anyone is to try to give them anything they want and that a little struggle is not necessarily a bad thing. I love this kid more than life itself, and if push came to shove and he really had his back to the wall, everything I have is his, but not to do foolish things with.
So, am I just being a hard-headed old fart? Or am I doing right by him?
My 28 year old son is all in all a great kid. Adopted at 2 months old, he has always been a joy to be around. Even in the teenage years we never lost communications and I never got "stupid." He still calls me almost every day, to talk sports, the grandchild, and anything else on his mind. Although not asking for advice outright, he is always feeling out my opinion about various subjects and situations.
Married with a 13 month old son, he recently took a contract on his house. It is a starter house in a neighborhood in transition that is becoming a not so desirable place to live. I am delighted to see them getting out of there. He is making $12,000 on this house and is using this as a down payment on another, higher priced house he has signed a contract on, in a better school district. The new house will be a financial stretch for him and his wife, but I think they can do it.
All was well until he called me today and told me that his buyer has backed out because the lender has raised his quoted finance rate. My son's wife "really has her heart set" on the new house, according to him. He told me that his first payment on the new house would not be until November, so he wants to go ahead and buy it and move in, counting on selling his old house before then. All he needs is $8,000 from me for the minimum down payment, which he will pay back to me once his old house sells.
Now, I grew up in a Southern cotton mill family where we kept the Great Depression going as a tradition long after it was over everywhere else. Financially, the experience made me ultra-conservative. My son, who has never known any real financial hardship, is a "damn the torpedoes, full speed ahead" kind of person. I proceeded to explain to him that although we both knew that I had the $8,000, I forsaw trouble here. If he was still setting on his old house next January of February, knowing that he couldn't carry two payments for long, he could be faced with either defaulting and ruining his credit rating or having to reduce his price for a quick sale, perhaps losing the $12,000 he is counting on, or even more. He really didn't want to hear this advice, but I told him that when he asked someone for that kind of money, their advice and involvement came as part of the package.
I finally told him that, bottom line, I would not feel right about helping him put himself into such a precarious situation, that he probably should cancel his new house contract (the earnest money received and forfeited would be a wash) or try to get a contingency contract on it.
In reality, I would never feel the loss of $8,000. I have the resources to bail him out even if my worst-case scenario came about. But, dang it, sooner or later he has to stand on his own two feet, make some responsible decisions, and even learn to live with deferred expectations if necessary. I am a firm believer that the fastest way to ruin anyone is to try to give them anything they want and that a little struggle is not necessarily a bad thing. I love this kid more than life itself, and if push came to shove and he really had his back to the wall, everything I have is his, but not to do foolish things with.
So, am I just being a hard-headed old fart? Or am I doing right by him?
I'm sure there is a way to loan him the $8000.00 under conditions where all parties are in a win/win situation. The other thing to consider is that it's better to see your money working while you're alive then when you're dead and can't enjoy it :thumbup:
