Still no mortgage. I'm kind of talked out on this subject but lets see if I can gather some energy.
We are still in Florida. All the boxes are stacked around us. BB has been unemployed for 2 weeks now. I have had ebay shut down for 3 weeks now. We spend our days checking our email for news, watching T.V. and complaining.
Our purchase contract had us closing by Jan 20th. After Jan 20th we were given 7 days extension. Now, as of 4 days ago- the seller is available to take any other incoming offers on the house.
I don't know when we are closing. I don't know why we have not closed.
As you guys remember we were denied a mortgage by the first guy. He told me this on the 14th.
Same day I find a new broker who PROMISED he could get it done by the 20th. "What would you say if I told you I could get this done by the 20th? Would you be happy?" were his exact words.
And he did work day and night on the mortgage. On the 19th he calls me to tell me he ordered an appraisal and the company cant get an appraisal done for a few days. We are now looking at a Friday the 23rd closing. "Well- our movers are coming on Friday the 23rd so that will complicate things but we'll make it work." -I think to myself.
On Wed the 21st I call concerned because I don't know who to make the down payment check to. I also need to know how this closing will play out with me living out of state. They tell me "We're still waiting on paperwork, we are not closing on the 23rd. I am aiming for a closing by the end of the month."
So I call the movers and reschedule for Friday the 30th. I'm very disappointed by now and BB and I spent the last week bored and annoyed at life.
The following Wed I call to get the specifics of when we are closing. I am told: "we are still waiting on the appraisal that was completed last Wed. It has not been faxed to us yet." I call the appraisal company. THEY are still WAITING on the appraisal order to be resubmitted to them so they can complete the appraisal. They said they have emailed mortgage company 2x for the order. So each company wasted 5 DAYS waiting around for the other company to do something. I called and got the glitch fixed in 1 day...but alas- it was to late to get a Friday 30th closing.
I called the movers AGAIN to reschedule and they told me to NOT reschedule, just call them a day or two before I need them.
On Friday the 30th I called the broker who promised me the world and acted really offended and ticked off when I told him I also had another bank working on the mortgage. He was so offended that I halted the banks efforts way back around the 22nd of January. I asked him when we were closing because our purchase contract had run out, the seller is really aggravated with us, we have rescheduled movers TWICE, and that if I was in a rental/lease situation then I would be living in a hotel right now. He tells me "this is the natural time line it takes to process the mortgage. You are not in danger of being denied but even if you were Donald Trump himself you cannot speed this up. It always takes 12-15 days to qualify and be approved for a mortgage."
WHY DID HE NOT TELL ME THIS BEFORE??!!
All along he kept acting like closing was just around the corner. The bank we were working with told me they could close by the 30th and I canceled their efforts because this broker promised he could do it by the 20th.(then the 23rd..then the 30th..now who knows.)
I am frustrated and so so over this. BB and I had so much enthusiasm to get to Georgia and refinish the floors..we wanted to spackle and paint the walls...take the popcorn off the ceiling- and now I'm so OVER moving. I just want to get there, unpack and return to a normal routine where furniture is in it's proper place, clothes are hung in the closet, and dishes are in cabinets.
I am also OVER having no income. BB and I planned for unemployment to last 1 month. We had enough in savings to cover repairs and living expenses for about 4-5 weeks before we would need an income to start coming in. Now we have been hanging around here in FL unemployed using up electricity, gas, utilities and not getting anything done. Come February we'll be paying hefty FL bills and setting up our GA bills (deposits and all that).
Oh and here is a kicker: When Mortgage guy said we could close on time on the 20th I was so grateful that I told him we will go to Atlanta (where he and coincidentally, the seller, is located) if that will make the process easier. He told us it's unnecessary as he will overnight paperwork to us in FL to sign and do it that way. Well on the 30th I call him and get that "natural process" speech and he sums up by saying; "and I think it will be best if you guys come up here to Atlanta to close so we can meet face to face." Atlanta is over 7 hrs from where we live in FL. It's 4 hrs from our new house in Savannah. It would use up about 13 hrs of our time to close in Atlanta and cost us over $150 in gas (2 cars). Its fine to close in Atlanta if he produced a miracle..but aint no miracle going on right now so why am I being inconvienced MORE? You know why?? Because BB plays baseball. It is so aggravating when people learn that BB is a ball player because suddenly they stop what they are doing to talk baseball with BB. Our vet spends more time discussing SEC baseball than he does explaining what he is doing to our dog. Our TV repairman did the same thing. The mortgage guy requested to talk to BB 1 time and the whole conversation was about different minor league teams mortgage guy knows about. No mortgage information at all. Mortgage guy just wants to pal around with a ball player and is disguising it as a necessary step in the mortgage process.
AAARRRRGGGG!!!! Ok, bitchfest over. I know it will all be worth it in the end.
Archive for January, 2009
Still no mortgage. I'm kind of talked out on this subject but lets see if I can gather some energy.
Grrrr....took dog to the vet yesterday to the tune of $325.00. She was throwing up and had diarrea. During the drive to the vet BB and I discussed how our vet always gives such good care but charges a bundle for it. We decided that this time around our dog doesnt need exceptional care. She needs some antibiotics and that's the end of it.
Guess what? Once at the vet, he starts talking about all the possibilities that could be wrong with her, all the possible sources of her sickness. He says "I'm just going to run some blood tests to check her white cell count, check her pancreas, check this, this and that." I was prepared for the vet wanting to do bloodwork and had a response waiting "no. If you dont mind can we just try some antibiotics and see if that helps her? We are on a tight budget and don't think the tests are necessary yet."
But I held my tongue! I didn't say it! I don't know why. The vet gets so darn reactive to all the possible things that could be wrong with her I kind of feel like it would be animal abuse to not allow the tests to be run. As it is he was already telling us she was running a fever and how did we not notice she was sick earlier?
I guess I feel like she is our child and no good parent tells a Dr to "skip the tests just give the medicine."
Then of course once I looked up the receipt and the "tests and blood drawing" was $110 of the bill I had major buyers remorse.
So I'm still bitter about that one. Very very bitter.
Since it looks like it will be about a week before we are able to close on the house I sort of snuck in some ebay auctions last night.
I put up 7 auctions for small items that can be transported to the new house if the buyer ends up being late to pay and I cant mail the item out immediately.
It seems rather ridiculous because my 2009 resolution was to not spend any money earned off ebay this year- so who really cares if I have any auctions running now or 3 months from now?
But I'm feeling panicky. I'm on edge. We have almost no money coming in right now and all our savings accounts will soon have a zero balance. So even though the money cannot be spent- it's a nice feeling to look at one bank account and see a growing balance.
And so far I have $50 in bids on the 7 items!
I never signed up for the ebay challenge because I knew my ebay would be halted for the move and finding a job...but so far I have met the goals anyways.
Mortgage update: things are going...alright.
New mortgage guy is on the ball and had me convinced up till last night we were closing on Friday (tomorrow).
Then he drops the bomb that he cant get the place appraised for 3-5 days.
So no closing tomorrow.
I suppose there is a higher reason for all this but when you have already attended goodbye dinner after goodbye dinner with friends, your husband has quit his job, you have movers lined up for Monday, ebay has been shut down for weeks in anticipation of moving and everything is packed and boxes are everywhere...I don't see any bright side to this.
Maybe Obama will increase the home buyers credit. That would be worth all this hurry up and waiting.
And its TOUGH to have $$ in the bank but you cant spend it! (Total selfish whine here) but it's hard to want to go out to eat but tell yourself you cant afford it when you have major money sitting in a savings account. I just wanna pay my down payment and get rid of this "rich" feeling already. It's a very intoxicating and powerful feeling to see the $$ sitting in the account day after day after day. (yes- I am paranoid of identity theft and obsessively check my account online to make sure the money is still there.)
One thing I have learned- closing costs are EXPENSIVE. It is EXPENSIVE to buy a house. I don't know how people can afford to regularly buy houses. I am wondering if people factor in their closing costs when they determine if they "made money" off their house.
Our good friend is in the process of buying a house right now as well and he is rolling the closing costs into the loan- not understanding that the 8k will cost him about 18k after 30 years- "he would rather save himself 8k now" was his line. So since he is not paying closing costs out of pocket he is really not concerned about their cost. We are paying them upfront and I am totally aghast at the prices. How are banks failing after they charged these prices and made such a profit during the market boom!?
BB and I are hoping this is our "forever house" because I never want to go through the mortgage process again, and I never want to pay closing costs again.
If we eventually turn this duplex back into the single family house it once was- it will be plenty big to raise a family and I think we will come out much much richer if we don't have to buy a SFH down the line.
I have a weird family history in that my fathers kids from another marriage were estranged for my whole life and I only recently met them and now we are pretty tight and see each other at least once a year.
Anyways, I just saw them a few days ago and learned an interesting tidbit.
During a conversation about her finances, my sister told me our brother (age 35) has already paid off his mortgage. He paid it off in 2 years.
According to everyone who knows him, my brother has always been cheap, frugal, thrifty. My father was the same way. I THOUGHT I was like my dad because I was financially minded and always a little frugal but my brother takes it to a different level with the craigslist, freecycle, and coupons. I always agreed with my brothers mindset to look for free before you pay, find the best deal, use money wisely- and my brothers wife has commented I am like him a lot with my way of financial thinking.
Anyways, of course I was stunned to hear they paid off their mortgage in 2 yrs. They sold his townhouse that he had bought before he was married and I don't know what kind of down payment he was able to put down. They bought their current house maybe 5 or 6 years ago and immediately only lived off his income while they applied the wife's entire teaching salary to the mortgage. It took them 2 years to pay off the mortgage. They had their first kid after the mortgage was paid off.
They have lived mortgage free for years now and each year that I have known them they make 1 large improvement in the home. They added a pool with a beautiful deck, they added an addition, they replaced the kitchen appliances.
I am writing this because primarily I am celebrating that for me, this is proof that OUR PLANS WORK! All these thrifty plans, these frugal tools, the wisdom all collectively allows people to live life completely debt free!
Everything my brother and his wife do...all of us savers do! All the wisdom we spread to one another about "dont buy a house bigger than you can afford...pay in cash...use coupons.."- that WORKS!
It sure was nice to actually see a person actively, publicly following a religion I have been secretly trying to learn - and it WORKS!
After being surrounded by financially irresponsible people (just about all my friends) it's a breath of fresh air to see the battle to be debt free can be sucessful. And I am happy BB heard this conversation too- he was really impressed to see that financial diligence really pays off. I have new found respect for my older bro and look forward to really asking him for financial advice in the future.
I have not been posting the last few days. Yes I lurked and commented on a few posts..but no posting of my own.
I have been embarrassed and ashamed.
It's possibly premature to even discuss now but I think we are out of the woods.
BB and I were denied our mortgage 3 days ago. Our income does not meet the lenders formula.
It happened by accident- me finding this out. I was having a mounting feelings of "uh-oh" by the lack of communication with our broker and the increasing emails from my Realtor asking "what is going on?"
So I flat out asked my broker if we were in danger of being denied the loan and he responded "yes. Two underwriters have rejected it and I will be submitting it to a third tomorrow."
This was on Tuesday. Closing is next Tuesday. We have 5 business days to get it worked out after 3 weeks of doing nothing because my original broker was avoiding my emails and phone calls.
So jumping into overdrive I contacted a bank that had previously reluctantly told us they could probably approve us- and then I bitched to my sister about everything.
Lo and behold her coworkers husband used to be a broker in Atlanta and swore up and down that his former boss is the man for the job. I called old boss in Atlanta and left a voice mail. I got a call back that evening and after talking he says "You are the perfect candidate for an FHA loan. Nothing you say has alerted me that this will be a problem. I will call you in the morning and I think we can have you approved by the end of the week."
The guy is a smooth talker and it made me nervous- but he has held up to his end of the bargain so far. He devoted a whole day to creating my application- he calls me 2 or 3x a day with info or questions and told me I was "informally approved" 2 days ago. He called last night asking if I want to escrow the taxes and insurance...that sounds pretty far along.
So I did some research on my own for this FHA loan (federal govt standard loan for first time homeowners- for everyone not familiar).
Some pros and cons. Pro is the standards are less strict with income, you only need to put 5% down, closing costs are less, and we fit the criteria. I have since learned that banks don't really offer this loan because they don't make $ off it.
Con is it is more expensive than a bank loan. I found out that I will have to pay PMI for 30yrs...and will have to pay a MPI fee that is rolled into the loan (about 1.5% of the loan amount). And I thought "uh-oh. That doesn't sound cheap."
But beggars cant be choosers and so I sat down and got to work about calculating how to minimize the damage.
BB and I decided to put 40% down. It's a luxury that most people cant do but we are very lucky I had the extra money from an inheritance sitting in a MM fund not earning much interest. With 40% down we are cutting the PMI down 35% (originally the ATL broker wanted us to put down 5%.), and we are cutting the MPI charge down 35%. As well as our interest payments over the life of the loan.
A benefit of this FHA loan is that our closing costs will much lower because our broker is charging us 1 point of the loan amount (about 1%) and the other broker was estimating closing to be about 3k...and the bank (that we are also still working with...just in case) wants 7k for closing costs. So essentially us telling the broker we want to put down 40% rather than 5% means his commission is severely cut since he is making money off the loan amount.
We were worried he would fight us on this point, but he didn't. He just said he would need an extra day to rewrite the application to reflect the new down payment amount.
Now- if you are still reading this long ass blog you are wondering why we didnt just suggest to the ORIGINAL broker we would put 40% down and we could have averted this whole mess. Well- we never told the broker we would put down 40%.
We told him we would put down 50%.
yup. That's what we needed to get "approved" in that guys mind. I never mentioned in the blogs that I was preparing to put down 50% because I would either get comments like "If you have to put down 50% then you cant afford that house"...as well as in this present economy many many people are struggling and I guess I still see it as somewhat "showy" to say I am putting down 50% when others are struggling to save up 3%.
BTW- that 50% was us scraping the bottom of the barrel to create. We were going to be left with single dollars after closing and planned to live off credit cards till our next paychecks arrived within a few days. Wasn't a good plan- I didn't like it- but it was our only option.
ANYWAYS- imagine this mortgage brokers surprise when he is talking to me initially and I tell him we cant get approved for a mortgage with 50% to put down. He was like "do you have credit card debt?" "no." What about child support, car payment, do you have another mortgage, did you have a bankruptcy?"
Then I told him the 50% was going to be really tough for us and if he could get us a mortgage where we would need to put down 48 or 45% I would be GRATEFUL.
So he comes back at me the next day and is like "I got you a mortgage and you only have to put down 5%. How wonderful is that?" And I later tell him we want to put down 40%...imagine his surprise again.
Anyways, he told me he wants to see the official rejection letter when it comes in the mail because he cant figure out why we were denied in the first place.
So things are looking up. Now that I wrote this we will probably get rejected.
I grew up on the Cosby show. I have fond memories of watching the show as a family with my mom and dad. We all laughed. There was something for everyone.
I watch the show now occasionally if I have time and there is nothing else on. Lately there has been nothing else on.
Well, come to find out BB doesnt like the Cosby Show! We are together 9 years and I discover this now! How can you not like the show?? He thinks the show is stupid and is still burned out on Bill Cosby from all those jello commercials from like- 15 years ago.
I just made BB turn off football and watch 1 episode with me (it was a good one) to give it a try. He laughed. I think it was less painful than he thought it would be. Not a fan, but I'm working on him!
To recap, I worried:
*About my mortgage falling through the cracks
*If I should buy twin sheets to fit a bed I have had in storage for years.
*If I could find the screws to put said bed together after it gets moved into new house.
*If I should re-use old bathmat and shower curtain in new house or buy new.
*how we were going to scrounge up some extra money to cover unexpected moving/closing expenses.
In the course of the day I have:
* no news yet on mortgage related stuff but that's ok.
*found sheets in storage to fit my twin bed (pretty rose colored).
*Screws are still missing but BB feels confident they can be replaced.
*When cleaning out our closets today, BB found a MOTHERLOAD of expensive clothes with the tags still attached. I'm listing them on ebay tonight, might pull us in an extra $60-70.00. Money could come in handy. However, my new years resolution is to NOT SPEND ANY MONEY EARNED OFF EBAY IN 2009 (Ironic-no?)
I was awake all night last night worrying about this impending home purchase.
My Realtor has been asking me if we are on schedule for a Jan 20th closing...and everyday I email my lender who replies that the application is still in "underwriting and maybe he will have an answer for me tomorrow."
Then, I don't know exactly how much we will need to put down or what our interest rate will be. Is that crazy? Talking to my lender before negotiations for the home started, we had several discussions about what down payment amount will probably get us approved...and settled on an amount he liked and sent us a pre-approval letter. When asked what interest rate we could get he emailed back "probably under 5.5%." So besides having no clue what the interest rate will be, meaning I cant predict my mortgage bill- I have started wondering if "underwriting" will come back and say they want MORE down than what was estimated.
Maybe it sounds irresponsible but BB and I have almost EXACTLY the amount of money needed for movers, the banks "estimated" closing costs, and the down payment. We will both get another paycheck in 1 week after closing to alleviate the burden of having basically zero balance in our account, but I am just freaking out that at the closing table they will give me a bill for a grand or two over what was expected.
And I keep wondering if we are paying too much for the house. Sounds silly- but in this down market where houses depreciate every month I now wonder if we couldnt have eeked a few grand out of the final price.
And I have had many items in storage for so long I was up all night trying to remember where the screws to my trundle bed are; "if I never find the screws to put it together will Lowes have screws to fit but look nice? Can screws be painted?" (my bed frame is white). "Do I even have any sheets to fit a twin bed? Maybe I should buy some now- but what color? What color will we paint the guest bedroom- does it matter what color because they are sheets?" "Do we bring our shower curtain and floor mat from here even though I think Maroon is too heavy a color for a bathroom? The floor mat is pretty worn out, but the shower curtain was very pricey and I remember all bath stuff being rather expensive-maybe bring it for the first week till we get our paychecks and then I can go to the store and get new stuff."....you see! I was worrying about insane things! I was up till after 4am! I cant go another night of that!
Is it true?? How can this be? I just received my stocks statement from December and I MADE $4,000!!
I didn't lose money! I didn't lose money!
I knew December was a better month than previous months but just thought that meant I would only lose a couple thousand, not make a couple!
I hope everyone else made money last month in the market as well, I hope I'm not the only one.
I have been getting the run around by Allstate about insuring our home only to find out yesterday that they wont insure duplexes.
That's too bad because when I added BB to my car insurance with Allstate it was only $10 a month extra! I was hoping for a great deal by adding homeowners insurance too.
Geico wont insure duplexes either.
I finally got a quote from "Foremost" (who?)for $700 to start the policy and then $290 a month for $223k coverage. I told them I did not pay $223k for the duplex but they need to add debri removal and cost of replacing the structure to the policy, and that is the coverage amount I need based on the location, material, and heating source. ...Does this sound expensive? I was assuming it would be about $100 a month. Our taxes will be about $250 a month...seems weird the insurance will cost more than the taxes because everyone always complains about the cost of taxes.
I have a call in to State farm...anywhere else I can try?
BB just asked me if I spent any money today. I responded that I bought stamps for $9.00. BB didn't spend any money and thought it would be a NSD. He was actually disappointed that we didn't qualify for a NSD. I'm so proud of him! And we were not even talking about money! We were watching TV. He thought of it all on his own!
This morning I listed 10 textbooks on half.com that I had in storage for the last 2 years, and one just sold! I made $19.50!
I am very new to half.com, never bought or sold on it before, so I am hoping for a smooth transaction.
It seems half.com does not make deposits into paypal, (kind of nice not paying pay pal commission) so I will have the money deposited into my checking account.
Although I made a NY Resolution that all ebay money will be saved in the 2009 year- half.com money will be spent because it will be a pain in the ass to withdraw the money from my checking account and put it into my ebay money market.
I am just selling my textbooks on the site, so I will keep half.com money as a little 'fun' money.
So far this year, nothings really happening. Started off 2009 with a lot of excess purchases of food take out/movies ect. But that has calmed down once I put my foot down. Last month we spent a wee bit much in luxuries and I worried we were backsliding and reforming old habits. 2009 was starting to look crummy but BB and I were both able to adapt back to our frugal ways after a hard day of "fasting" (NSD).
I am proud that though we still WANT things, we are getting deeper into a frugal mindset and it is easier to do without.
We just started tracking spending and being really committed to financial freedom this summer...I am proud of how far we have come. It was very painful the first few months, but it really is getting easier and easier to do without.
And it is easier to train my brain to run numbers/think about long term consequences/and to have a lot of patience.
I am actually surprised that after 28 yrs of thinking one way; I am able to train my mindset against thoughts I grew up with in just a few months. I guess that's part of getting older. Maturing, becoming responsible and doing what is right, not what is easy.
But it was tough- no ignoring that. I can understand why its so easy to "fall off the wagon". It's so much easier to have the mindset to spend than it is to save...but once you get through to developing a comfortable/frugal lifestyle, and creating a mindset that thrills over savings and reacts violently with guilt over stepping out of budget line, life gets easier.
And better. I love the discipline and self control I have. I feel empowered and respect myself more. And I respect my husband too- it's hard enough for me to do this-BB really did not want to do this but did it because I asked him to. And he has changed so much that now he WANTS to save; although he is still a bit liberal with the spending, he has come as far as I have and I love him more for being able to accomplish this change of attitude.
Hopefully the painful part is over and we are on the track to a long, healthy and prosperous life.
2009 Goals and Game plan:
1. Bank one source of income.
Our household currently has 3 sources of income and with the big move in February we might possibly get 5 sources of income. Though 1 source will be lost for a time while BB builds up a new lesson client base. With all these income sources I really want to just save one entire income and not allocate it to savings for anything. In 2009- I am starting small. EBay. Right now, eBay is our second largest income producer, but once we move I think it will become our smallest. So starting TODAY- all money earned from eBay stays in my pay pal money market account and WILL NOT BE USED IN 2009. (That's a scary declaration to make.)
*So in 2010 we should have $3,000+ in eBay money market.
2. Pay extra on our mortgage. My goal is to pay off the mortgage as soon as possible but with this being our inaugural year in the house I will start small. An extra $50 a month will create one extra mortgage payment. So that's the goal for this year.
* So in 2010 we should be used to the extra $50 a month and be ready to pay an extra $100 a month.
Top Priority (Feb/March):
3. Get a job. With eBay no longer providing a major income, I will be forced to get off my lazy ass and get a job. I am moving to a new city where I will permanently reside, we have a house to pay for- no more excuses Gamecock. Once unpacked, priority number 1- look for a job.
*Better be full time employed come 2010.
When I can/Some point this year:
4. Save rental income from unit #1 for eventual renovation of unit #1. My rental unit in CA is pure 1970's. I was planning to renovate the unit once my tenant vacated and either sell the unit or rent it for a better rate. However, the $$ I was going to use for renovations became my down payment money on our first house.
The tenant has resided there for 5 or 6 years now and seems to have no intention of leaving. Now that the renovation money has been spent I need to start saving again because she is eventually going to leave. Currently I depend on the income to live, but once I have a job I can then put the rent checks into a "Unit #1 renovation" savings account.
* Hope to have $6,000+ saved for eventual renovation.
Once we are moved into our house:
5. Start saving for home improvements. I have not researched the costs involved yet, but would like to get these big ticket items accomplished in '09 or '10 so better start saving/planning. In order of my preference, we want:
1. A back deck add on to the house.
2. To enclose and landscape the backyard.
3. A new kitchen.
BB has promised to send $1,000 a month during the baseball season to save for home improvements. However- he has a very very poor track record for following through on promised payments-so I am not going to plan for his money right now.
Our mortgage, taxes, insurance is covered by rental unit #2, leaving me to handle utilities and bills. But once I have a job I will be able to allocate a large percent of my take home pay to savings for these items. IF BB sends home the $ he promised, we might get 2 out of the 3 done this year.
*Hope to have $10,000 saved for these improvements by 2010.
Other things to do in 2009:
Get umbrella insurance
Stay out of credit card debt
Save $2,000 for a new car for BB- his truck has 120,000 miles on it.
Build/maintain $4,000 emergency fund
Maintain spending/tracking logs
No credit card debt.
Have become smarter/more efficient with money.
I am sure there is more- but I am just overwhelmed by what I already wrote. That seems big enough for one year.