I wanted to know if there’s anyone on this forum who has gone to a B-School despite having a mortgage. This is one of my biggest concern because I bought my place at the peak and am now stuck with a mortgage. Even if I rent out my place and move to a different city for an MBA, it won’t cover my monthly payments. Any thoughts? Do you think it’s still worth it? I am looking for 2011 intake.
Actually, there’s a show on HGTV called “Real Estate Intervention”. In this one episode, this girl in Alexandria, VA bought at the height of the market and wanted to go back for her master’s degree. She ultimately decided that she couldn’t afford to and delayed graduate school indefinitely…
Here is the trade off I see: Sell your house and take a immediate loss vs. delaying MBA for 3-5 years and forgo the higher salary post MBA.
If you rent it should cover the vast majority of the mortgage payment, no? Then you only have to cover the spread each month. Is that doable? I have rented before and it is a roll of the dice. A nice tenant can make it a enjoyable experience while a bad tenant can just ruin your life.
How far underwater are you? Maybe try a short sale?
on the bright side- primary home equity is pretty much the only asset that doesn’t get considered in financial aid considerations 
phBoom has a sensible approach. How much underwater are you? How does that compare with the NPV of future earnings available to you with an MBA minus the NPV of earnings available without. If you rent, you will presumably make up the difference between rent and mortgage, so that will be part of your costs. Grad school costs approx = [tuition] + [room+board in MBA city] + [2 years foregone income] + [diff between rent and mortgage] + [repairs & Landlord monitoring costs] + [mortgage for any unrented months]. Add in that you will probably have a more attractive choice of careers with the MBA than without, and the MBA is clearly the best choice. As for waiting for your home to get above water… God knows how long that will take… I wouldn’t choose the waiting option. Besides, you don’t know if you’ll be accepted to a program after having passed on an offer the first time.
kkent Wrote: ------------------------------------------------------- > Actually, there’s a show on HGTV called “Real > Estate Intervention”. In this one episode, this > girl in Alexandria, VA bought at the height of the > market and wanted to go back for her master’s > degree. She ultimately decided that she couldn’t > afford to and delayed graduate school > indefinitely… Ha ha ha, my wife likes the HGTV…so I have seen that episode. It’s actually a pretty depressing show…
^ I watch HouseHunter International. $300k vacation house in Bali, steal of a life time.
Yea I’ve seen that show as well. That show and one on people looking to rent seemed to have replaced all the Flipper shows to ran a few years back. It is a scary show to watch as someone looking to buy in or around NYC. I am in my MBA part-time and sort of have the opposite problem. As company will now only pay 10k per year (was 100%), do I delay the home purchase while I save up renting a bit longer than planned. Oh and I love the girl on that show…a real cutie.
bchad - good perspective! I have thought about it that way, and I think is the best way to go. thanks,
Or you could just finish the CFA program for really cheap, save $100,000 and continue to make 2 years of income. MBA = Overrated. Skip MBA, build whatever skills necessary to make it to the job you want. If you want to be an analyst, fundamental, spend two years analyzing companies and finishing CFA, and save the tuition. Go to local CFA events to network.