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Day 193: Reality Check

10 Jul

We are relatively private on this blog, but I feel like we’ve gotten to a point where we can finally admit defeat and open up about something that’s been happening over the last seven months.

We bought our house with the intention of moving to a better house in about 5-7 years – or when our first child was old enough to go to school. It was supposed to be a stepping stone – to build equity. We didn’t buy at the peak, but it was close enough to the peak that we are now underwater. When Temoc decided that he wanted to go to dental school, I unrealistically thought that the house would become a rental property and we would move back into it when he was done, until we decided where we wanted to live. Months went by and then I realized that any rent that we would receive wouldn’t come close to covering the mortgage payment. With the uncertainty of how much student loan money we will receive, and how long it will take me to find a job, I finally decided it was time to sell the house (Temoc was sold on the idea months before me – I should have listened to him). We found a realtor and a few months later, we had a buyer. We were ecstatic! Then came the first blow – we would have to stop making payments in order for the mortgage company to consider the short sale. We were completely reluctant, but felt we had no choice, so we stopped making payments. We were so sure this would get us a short sale. Three months later, we were approved by the mortgage company! What a relief!

Unfortunately, that wasn’t the end to our story. Several weeks went by, and we heard not a peep from the mortgage company. Finally, we heard that it was with our mortgage insurance company. We had no clue that we had mortgage insurance, and thought that we opted out of it – I guess we should have read that paperwork, afterall. So, again, we waited. We lost track of how many weeks had passed. Fast forward to Thursday night, and we got the dreaded email from our realtor. The mortgage insurance denied the short sale. We are still in shock. We didn’t think it would take this long for them to approve or deny it – and we thought we were in the clear after out mortgage company approved the short sale. So many little clues should have warned us that we were in a downward spiral, but we tried to be optimistic. Now we have to learn about the foreclosure process – what that actually means, beyond just ruining our credit. We’re scared of what tomorrow will bring, and frankly feel sick to our stomachs about this whole process.

Moving forward, I hope that we have learned a valuable lesson in trusting our instincts, while being very cautious in making such a huge investment. We know we are not the first couple to have gone through a foreclosure and certainly (sadly) won’t be the last, but it’s quite difficult to admit defeat and to realize the situation is much more serious than we thought it would be seven months ago… We’ll be sad to say goodbye to our home, but it’s just a home. We have each other, and our cute dogs and I couldn’t ask for more (well, I could, but that will be saved for another blog post:)).

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New Favorite Store

28 Jul

I used to dread shopping at Ikea. I hated how you’re forced to walk what seems like 10 miles, and two hours later, you haven’t found a thing to buy.

Well, all of this has changed.

I learned how to shop in that massive store. We go in there with a purpose (we need a desk – or we want to look at their bold fabrics). A few weeks ago they started changing their showrooms, which makes us want to visit every week, so we can see the rooms as they’re built! We’re in the market for fabric, curtains and lamps, so we’re hoping they have new products in those categories very soon…

Some of the things we’ve bought recently include:

Vases - $2.99 each (we bought them for $1.99!)

Pots - $2.99

Curtains - $14.99 for two panels

Curtain Rod - $9.99 for 83-152

{Source for all photos: Ikea}

These items were cheap, but they don’t look cheap. Ikea does have a lot of products that look nice from 10 feet away, but up-close they look cheap, which is really my only frustration with the store. Regardless, we’ve found so many things that now decorate our home and for really good deals. I’ve officially converted to an Ikea fan!

First-Time Homebuyer

21 May

We don’t want to jinx anything, so we’re not using names.  A couple that we know put an offer on a house today.  Yay!  We hope they get it, and we hope they get it for the price they offered!

After we purchased our house almost 19 months ago, we’ve come up with what we think is valuable advice for people looking to buy a house.  This advice includes:

1.  Save money before you purchase your house.  Don’t put all of that money down because you will want to purchase paint, and other miscellaneous items to make the house yours (and these items add up very quickly). 19 months later, we’re still making it ours.

2.  In addition to saving money, be sure that you can afford to pay the anticipated mortgage bill.  Pay your rent, and then put the difference from what you’re expecting to pay with a mortgage, into savings.  This way you will know for sure that you can afford the extra cost.  We can afford our mortgage bill, but we’ve had to stop eating out, buying clothes, netflix, etc.  Ask yourself if you’re really willing to eliminate discretionary funds from your budget.

3.  Don’t listen to anyone that says you will make more money in the future.  Thanks to furloughs, we’re making less money.

4.  Be aware that a 30-year fixed mortgage bill can change from year-to-year.  The escrow account will change over time because of changing home values the tax assessor uses to calculate your tax rates, and you could end up paying more (we’re now paying a few dollars short of $150 more per month than when we bought the house!).

5.  Try not to be emotional about the house(s) that you put an offer on because you may not get it.

6.  Don’t be in a rush to buy a house.  A month or two could provide you with a much nicer house and in a nicer neighborhood.

7.  If people are telling you that we’re at the “bottom” of the housing market, don’t listen to them.  Wait until the housing prices start increasing, so you know for sure that we’ve hit the bottom.

8.  Owning a home comes with a lot more responsibilities than renting.  If your dog urinates (or worse) on your carpet, that’s your carpet that he/she is ruining.  You are responsible for watering the lawn.  You are responsible for everything that breaks, or floods.

9.  Enjoy your realtor, and enjoy looking at the various houses on the market.  It’s fun to see the differences in houses from subdivision to subdivision.  You’ll find out what you like and what you don’t like by going inside of the homes, not just looking at the houses online.

10.  Consider renting in the neighborhood that you’re looking at before you buy a home.  You’ll find out firsthand whether or not the neighborhood fits your lifestyle, safety concerns, desired commute time, etc.

Although there are negatives to buying a house, we still think it’s worth the added costs and responsibilities.  We feel like we’re investing in our future, and enjoy the fact that we’re not paying a landlord to go on extravagant vacations (like a month long vacation to Turkey that Temoc’s landlord took when we were moving in together)…  If you buy now, you’ll also get $8,000 when you file your taxes next year.  We wish we got paid to purchase our house! :)Closing Day

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