Update on the house conundrum:

After my broker told me we couldn't be approved for the dream home's asking price because we'd need 15% down, I felt very relieved, but also terribly disappointed. I started thinking (based on comments here and something he'd mentioned) about the FHA loan option. I looked it up and the loan limit for a duplex in my county is $407,800.

Out of curiosity, thinking we could try for a cheaper home at some point, I asked the broker if the 15% down requirement applied to duplexes if they fell within the FHA loan limit. He said no, as long as the loan didn't exceed $407,800, all you need is 3.5%. That was good news, because sometimes cheaper ones come up on the market (they just go really fast usually).

A while later it occurred to me to ask, what if we made an offer on the dream home where the loan amount was $407K? So with the $47K we could put down, that would take us to $454K, or $16K short of the asking price. To my surprise, he said yes, that would be fine, and he sent over an approval letter!

Well, that was fast! I told my friends and family, and we thought about it some more. As I said I would, I ran more budget projections and thought about worst-case scenarios. And, no matter how I squinted at the numbers, I couldn't get past the fact that if we didn't get the WV money and didn't sell the US condo quickly, we'd have a pretty tough first year and a half. Using up our savings meant saving up for the US and UK renos and just hoping not to have to put any emergencies on credit cards during that time. Plus, it meant not much fun money even if there were no emergencies, and one of the reasons we love the home is its prime location near restaurants, bars, shops, bowling alley, theaters ...

The thought of making that offer just made my whole body feel tense. At that point it was just NT and me, and he said that projection sounded worrisome to him. I agreed and said maybe we just shouldn't make an offer even though we were approved.

I went to pick up AS from something and told her on the way home. She offered a brilliant suggestion: Why not make an even lower offer and just offer to pony up what part of our savings we felt comfortable with?

I loved it. If we didn't use the UK reno money, just our US savings, the UK money could be our cushion while we slowly paid for the US renos and built savings back up. Then by next spring, when it was time to spend the UK money, we'd have US money to serve as a cushion. And when the UK renos were complete, we could rent it out again and start building up money over there, too.

So I asked the broker if I could make an offer of $438K -- $31K down plus $407K loan -- and he said yes. I told my real estate agent and she's reached out to the other agent. So we shall see!

I also did a mortgage calculator and believe that if the offer were accepted, the mortgage would be about $300 less per month than the original loan we were trying for. Further room in the budget!

I don't think they will accept the offer; it's $32K under asking price and we're stipulating that they'd have to pay closing costs, which is probably another $8K or so. But as soon as I made that decision, I realized the two bad feelings I'd had all week were gone -- the stomach-churning worry of stretching too thin, and the aching disappointment of not being able to put an offer on this lovely house. Now I feel like I've done my best without putting my family's finances under too much potential strain.

And, if it doesn't work out, we'll continue our search, but we'll look within the bounds of the FHA loan and the amount we feel comfortable putting down.