Gamecock's Mind over Money

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:

Immediately:
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.

December tracking finished. I am disappointed that the ebay sales and consequently our income took a major blow due to Christmas putting a halt on my listings around the 18th...but I was bracing for the decrease in final sales.

I am also disappointed that our eating out is up again. Actually, all our "fun" is up...I was expecting that. Some backlash from all the frugal living of the last few months. I am annoyed because I pointed out all the increased spending in our "takeout/dining", "Best buy purchases" and "vitamins" to BB and he basically brushed it off as no big deal. I see it as "we are reforming old habits that we cannot afford to maintain" and he see's it as "last month had a lot of one time events and we had to spend the money we spent."

Anyways, without further ado, our December spending:
Income $4416.00 (1,200 ebay)
Bills $997.00 (groceries waaay down)
Wants $1290.00 (way up from last months $577)
Christmas gifts $362.00 (9 people)
house buying so far $1819.00
Leaving $310.00 that went to savings

Savings was WEAK but we bought a house this month so...I'll cut myself a break.

Back from vacation. Spent minimal money. Kind of worn out and now turning my attention to the house purchase. The upcoming bills are adding up so I will be asking advice soon enough regarding those.
going to tally up December spending now. Update coming soon.

I am off to pack. We are driving up to NY for the holidays. On the way up we will stop in GA and hang around for the house inspection- then continue on our way.

Happy holidays to everyone- everyone stay safe.

I'll be back around the 1st of the year.

Lets see whats been on my mind...
1. BB's 24yr old sister has a full time job, lives at home and likes to spend. After repeatedly telling her we are having a minimal Christmas this year because we had the wedding last month and bought a house this month- I come to find out she spent $100 on BB & I. *Sigh* so back to her favorite restaurant we go to increase her gift certificate. Next year- I am sitting her down for a discussion- no more saying things and hoping she understands.

2.BB's dad has been stressing us out telling us to hold on the closing of the home till Obama takes office because he might increase the first time buyers credit. I would have been fine if he told us to do that before negotiations started- once we started the seller made it clear he wants to close ASAP and I was agreeable to that. Now BB's dad has told us we should extend out the closing- and I thought I could- but it turned into a hassle and I didn't really get anywhere- and BB's dad keeps voicing his "concern" for "how much money we might lose out on." So BB finally told him to back off because "Gamecock was in a time sensitive situation where she had to make a snap decision, and that's what she decided so that's what we are going to live with."- he really thought he was defending me by saying that too. I just let it go. Didn't even point out how he is telling dad to back off because I made an unfixable mistake. He is proud that he backed me up and "defended me", so whatev.

2. Still pondering how to move 2400 sq ft of items and furniture into 1100 sq ft. Problem is I have all my stuff from childhood- figurines, some stuffed animals, blankets...my bed. And I have my parents things...a million photo albums from their childhood- their years books, my dads old war toys- stuff thats boxed up but hard to store in a no storage house (old houses- they have no closets!). But its ok. If the 2nd bedroom is storage for a while then it's storage for a while.

3. Scrapbooked my wedding into an album for BB's mom for Christmas. Scrapbooking is deceptively expensive; $12 for an album, then $20 for stickers/paper/trimming/stuff...plus I needed a new paper cutter (another $12). And forget that it took me 2 straight days, like, 12 hours to make it! But I love to do it anyways.

4. I messed up on ebay- sent the wrong barbie to the wrong buyer, and their barbie went to the other barbies home. So I will be refunding quite a lot of money and am praying they both do the right thing and send the barbies to the right home. One barbie cost about $50 more than the other- so I know one person wants to do the right thing so they an get their expensive barbie! Anyways, I think I stress about this situation more than they do. Neither buyer has contacted me in a few days, or answered my questions- they were supposed to ship out the dolls to the rightful owner a few days ago and I have heard nothing about it. Oh well. It's out of my hands. I have not refunded any money yet- I told them they will get a refund when I get a Delivery confirmation number so I know the item is on its way to the rightful owner. Whatev there too.
That's it- now I'm off to read all your blogs!

ummmm...I JUST BOUGHT A HOUSE!!!! I did!! They accepted!!! I own the pretty pretty teal house with a big front porch and lead glass windows!!

I just got the call! What do I do!? Do I tell my friends? Do I start running numbers? I am all alone cuz BB is at work and I feel like I should DO something!












Extra pics for Joan!! The fireplace!

So we sent in our offer this morning. It was for exactly 15% below asking price. They immediately countered with 3.5% below asking price and said it was their final offer, they don't want to counter and stuff.

To be fair, they did recently drop the price 7.5% before we even made our offer. And if we end the deal at their counter- they are only walking away from the place with a few thousand in their pocket after paying realtor fees because they purchased the place 4 years ago in an inflated market.

But I just countered anyways...1.5% less than their counter. I phrased it as "A done deal at xxx price"....so now I am keeping my fingers crossed!

I am making an offer on the duplex today. I actually wanted to do all this yesterday but my realtor kind of took an entire day to write up an offer and send it to me to sign. So when everything opens in an hour I'll fax it back to him from my local printing store and wait for the news.

Everytime BB and I go to "the south" we get so irritated at how everything takes forever. People truly work on "southern time". We remind each other about "southern time" once we start bitching about the customer service- it takes us a good day to get on their time schedule.

Anyways- I am stuck in that flux of time where I am too frightened to tell any of my friends the news in case we don't get it-but wanting to allow myself to be excited and enjoy the process. Apparently I cant get very excited without a bunch of squealing and questions about decorating.

BB is terribly excited. He is so emotional/in love its all he thinks about and it's all he wants to talk about. Talking about it to me is fine if he wants to talk about prices, or taxes, or moving vans, or forwarding mail.

But no. He has never thought of such things. He is trying to figure out furniture placement. He has already told me he wants to move the kitchen wall to open it up and "it should only be a few thousand dollars." He is spending in his head all the money we will earn from our first time home buyers tax credit (if we get one- but he assumes we will). He is such a girl in this process.

I am not even getting into how he thinks we need a big screen TV. It's like a necessity to him. It's expected. Forget that we have 2 TVs, one 30 something inch he just got LAST YEAR for Christmas.

I have already created a defense plan against his spending though. Since I oversee the money- once he starts talking of going to best buy or hiring someone to move this wall that is perfectly fine where it is- I can just tell him that we don't have the money. I mean- we probably wont. But rather than argue about how I don't want another TV..I'm just sticking to an automated "we don't have the money to do that right now honey. Maybe in a few months or next year."

I am not allowing myself to think of such things and only think of everything in stages. We are almost completed with step 1- placing an offer. He asked why I am not all excited about decorating and such- but if I get the way he is- I think the process of getting the place will get messed up or we will end up making mistakes because we are both to emotional.

So I am allowing him to keep his head in the clouds while I oversee all this "stuff" to do first. It keeps me satisfied "that I have control" of everything; I have a big fear of being "taken advantage of", or screwed, by people. Plus I am a little happy/surprised that he respects,and believes in me enough to just hand me the power regarding this step and trust that I will do it all correctly and I will make this dream happen.

I sent my financial adviser an email detailing the possible duplex purchase and asking for suggestions/advice...and BB got irritated with me.

BB wanted to go forward with making an offer on the place and I told him I am waiting for a response from the financial adviser. BB got irritated and said;

"I only trust 2 people with my money- you and my father."

That was a surprise. I don't even trust myself with money. I didnt think BB respected my interest in money- I thought he thought I am very elementary in my money management skills because I am always researching/questioning/ or deferring to other people. I think in the school of money management...I am at about an 8th grade education level. I know the basics...I know a little about more than basics...but don't trust myself to make any decisions on my own. Since I can never make a quick decision or snap judgment about money related stuff - I thought I appeared to be a bumbling idiot to those around me.

I guess I look like I know what I am doing. How odd.

Disclosure statement: BB blames my financial adviser for our stock losses from this past year. I did go to our adviser twice with panicked "Maybe I should pull out now!" calls...and both times my adviser calmed me down and kept me in the market. I don't blame the adviser- everyone lost money-it was not his intention to lose me the money- but BB really has no respect for the man.

I got the lease information. Top floor is in month 4 of a 12 month lease. Bottom floor is month to month and needs 30 days notice to vacate.

Now I am going back n forth with the lender to try and lock in a "primary residence" loan even though once we close I will have to give our bottom floor renter 30 days to get out. I don't think they are going to go in my favor- and that means we miss out on the $7500 first time buyer tax credit too (we can refinance to a primary residence loan 6 months after closing...we miss the July 1st deadline for the tax credit).

I am going to request that the current owner vacate the bottom floor unit by the time we move in...but with house sales falling through all the time I doubt the current owner will be agreeable to that.

Now...question is...what to pay?? Owner has property listed for $32,000 over what he paid for it in '04. He bought it as an investment property and lives 4 hrs away in another city. He has several investment properties for sale in the area. He did not put any improvements into the property at all. (Previous owner did all the work.)

If I get this place for what he paid for it in 2004...am I getting a good deal? Months ago (last year?...amazing what sticks in your head) Suze said that if you can capture 2005 housing prices- you are getting a good deal- but housing has since dropped lower.

I am a bit stuck because the current owner paid during the housing boom- and so although he might have paid an over inflated price- he wont want to take a loss on the property.

Any advice? Suggestions? I think we are going to make an offer today. (Ack!!) Where should we start? What is reasonable to expect to end up?

I might need the tax pros help here...and the landlords help...and well, all of your opinions!!

BB and I found a house (duplex) that we want to make an offer on. I LOVE LOVE LOVE it. I actually saw it last month when we went house hunting but BB talked me out of it and so I agreed to move on...but my heart never really moved on. So when we looked at it again this weekend, BB instantly fell in love too. (I have no idea why that happened - but he loves it now.)



Sooooo....the only drawback is...Both units are currently rented. We are investigating how long the lease is and if there is a kick out clause for change of ownership- but I am betting the place will be rented until this coming August.

So if we buy this place- we must buy it as an "Investment Property" in the mortgage paperwork which bumps our 5.5% interest rate to a 6.5% rate for 30yrs fixed.

Once the leases have ended and we can move in- we are told we can refinance it and call it a "primary residence" mortgage to get a better rate.

Questions:

1. First time home owners tax credit- will I get it if we buy an "investment property?"...If not, will I get it if we refinance into a primary residence? How about if we refinance in August and the tax credit is slated to end in July 09?

2. Fully rented, the units create $2,000 income. Going from a 5.5 to a 6.5% interest rate is $100 a month difference. Will it be worthwhile for us (me) to buy the property now and continue to live in FL but landlord in GA? I guess I need to run the numbers myself...but I am just thinking to myself "what if something breaks? What if there's a problem? Landlording from so far away...paying higher homeowners insurance (have not gotten quotes yet)...paying to live in FL...what $$ amount would make this a worthwhile venture?

3. Depreciation/improvements write offs...I will be able to deduct depreciation from the whole building now for the year...but how bout if we make major improvements while the property is still an "investment property"? BB and I would like to redo our kitchen and add a back porch on...should we do all that after the renter has moved out and before we refinance it into a primary residence? Or does improvements/depreciation cancel each other out?

4. Will we be able to refinance? We are putting over 40% down...but I have heard nothing but cries of "we cant refinance!!" coming from the media.

5. Is this a financially dumb move??

BB is just...pressuring me. Arguing with me. Arguing his point over and over again. He never ran any numbers, he did no research. I don't trust his input because I know it comes from emotion and not clarity. He says "you were ready to commit to 5.5%...whats $100 a month(at 6.5%) for 8 months when we are pulling in $2,000? Then we can refinance. We can save the extra income and put on that back porch you want." But I cant help but have ringing bells in my head screaming that this is a bad bad idea...is it??

I hit $40,000 in savings today!! I made my goal!! Only took me 3 years! I never set a time limit on hitting the goal (because I never thought I would get there), but 13k a year is good in my book.

And honestly I cannot act like I did it all on my own. I did start out with a bounty of items that I inherited that needed to be sold on eBay.

The money ALL came from eBay...but it was blogging, other sources of income and discipline that kept me from raiding the eBay account time after time.

Anyways, I'm thrilled with hitting the goal, it's a bright spot in this housing thing.

Mortgages are complicated right now...we are primarily working with Bank #2 and we have a preapproval letter. We worked it down to a 5.5% interest rate, so yea that! The funny thing is, Bank #2 told us that if I moved to the city and got a job making $20,000 I just need to show them 2 paystubs and the preapproval would have been sooo much easier to get. Seems like kind of flimsy way of evaluating ability to make future payments...but once I knew how their game worked, I was able to fit my numbers into their formula and make it work. So we did work it all out without me having to move out of state, get a quick job and pay rent on an apartment just to get qualified.

So tomorrow we are driving up to GA to see if there is anything worth spending our 40k on.

We'll see. 3 duplexes went on the market yesterday for 30k less than the one we are hoping to buy...but they are not as nice either, but they are all in about the same location. So the housing market is still in a slight decline, good for us. It encourages me to be patient and wait for the place we want for the price we can afford.

That's it for today. I'm tired. Honestly, all this mortgage stuff has just worn me out.

Well, all is not well in the lending industry. But we all knew that. I just thought I was immune to the banking problems. hahaha...guess not. Heres an inside look at what I learned today-

Bank #1 called me back wanting to know why I was bothering them when I clearly don't qualify for a mortgage.

Empowered by yesterdays lending tree approval, I stated my case. Banker at bank #1 hands me off to her boss.

Boss says I cannot even touch a "normal" mortgage based on our measly income...but let her see what she could do.

Calls me back with these lending parameters:
If I put 25% down (50k)...they will loan me 150k. Interest rate is 7% for 5 years- after that it balloons to whatever the current mortgage rates are...and it must be a 15 yr mortgage...and I must liquify at least $80,000 and transfer it into their bank into CD's or something so that- they get the business? or they can seize it if I don't pay?...they kind of lost me there because I had loud ringing bells going off in my head and a smart librarian girl was screaming "DONT DO IT!!"- they kept stressing this was an in house loan and they were trying to work with me and around my situation. When asking why I cant get a 30 yr fixed- they said they NO LONGER OFFER THEM??? I don't know. Whatever. It's not going to work so I just said that I would think about it. I think they were qualifying me for a commercial loan because they were actually counting the duplex rental income on this loan...

Bank #2 (Broker guy from lending tree)...all is not well there either. I thought yesterdays 16 pg document was an approval, but he called me back today saying he was meeting with his boss to discuss my case. I guess he compiled all my info into a mortgage and sent it to me to verify that the info was correct- and perhaps added in the 6.653% interest rate to scare me away. It didn't work and so now he's stuck in a meeting to "discuss my case" with his boss.

Bank #3 is "still in underwriting" (where it has been for well over 2 weeks). No decision there.

BB is telling me he does not want to lose the house because of 1/2% interest point. I have my pride. I refuse to pay as if I have a bankruptcy or foreclosure in my background. I'm not going to agree to over pay for something everyone else is getting cheaper. I'll wait if I have too.

BB says we can always refinance later. That's what all the people now losing their homes thought too.

So we have compromised. I want an $850 a month mortgage. If we must go with a 6.5% interest rate (or higher) then we will have to negotiate harder and knock ANOTHER $20,000 off the cost of the house. Then my payment is at $850 plus all the other crap like I was planning all along when I assumed I would be able to lock in a decent interest rate.

BB accepts this plan. Poor BB. There's no way the seller will go that low on the house. But I will let him try...

PS. Congrats Monkey Mama on your awesome refi today!! Instead of discouraging me- your post made me dig in my heels and stick to my pride harder.

After my day long rant about getting rejected for a mortgage...bank #2 just sent me a commitment letter for $140,000 @ 6.5 interest rate!! It came out of the blue, suddenly I have an email in all kinds of legal-ese with 16 (16!!) attached documents for me to sign!

Seems my own argument against their first rejection was well stated. I triumphed!!

Now I gotta work on this 6.5% interest rate. That sucks. They think I cant afford the payments so they tack on a higher rate to make it more unaffordable!

Anyways, my head is spinning. BB is at work and doesnt know any of this yet. I had already divorced myself from the idea of home ownership so suddenly seeing seeing 16 documents to sift through is overwhelming.

I need to take a day to decompress.

Thanks for all your support though...it helped me feel better about the rejections...
....but being accepted FEELS SO MUCH BETTER!!

Just got rejected by bank #2 about applying for a mortgage. Bank #3 application is still in "underwriting" where it has been for several weeks. So that option is not dead yet but may need some resuscitation.

After telling BB about bank #2 rejection- we tried to figure out what areas we needed to improve to get an approval. Bank #1 said that our mortgage payment would be 80% of our monthly income and they would only approve 45% of a monthly income. So we would need to put down $130,000 for a $200,000 house. The woman from bank #1 called me with the rejection info while I was in an airport and didn't have much ability to absorb her numbers. I knew they were crazy off...but we already had bank #2&3 working on our applications so I just let it go.

Bank #2 gave us no formula to work with. I just got an email stating, "After further review of your documents, the debt ratio is still too high and we are unable to approve you at this time."

So BB and I tried to find our weak links. We have gotten conflicting information about my rental income counting as income. I have heard the full amount applies towards my income, 70% applies as my income, or the full amount minus HOA fees counts as income. I have heard that BB's lesson income will or will not count because he is working in a state other than he will live.

But no matter how we tally up the numbers, if we put 30% down, our mortgage payment will be 20-30% of our monthly income at the current 5.5% interest rate without accounting for the additional rental income from the duplex we want to buy.

So I wrote bank #2 with my calculations. I asked where we needed to strengthen our numbers because right now we are offering:
credit in the 800's
$0 debt
30% down
assets that could be liquidated to pay for the house in full
mortgage payment will be less than 30% of our income.

Bank #2 wrote back that he will re-review our paperwork with his manager.

Inspired- I called bank #1 to argue our case. Have not gotten a call back yet.

And bank #3 is not dead yet either.

BB and I have hotel rooms booked to take BB's father to look at the duplex we want to buy this weekend. We thought we might make an offer this weekend. Now everything is on hold until we get a positive confirmation from a bank.

I just feel like a loser. I feel like no one wants to 'work' for us- they want to wait for the easy applications to come in rather than get their hands dirty with us. And I feel like all this being responsible with credit scores, no debt, no student loans, no car loan, full down payment is MEANINGLESS. I am frustrated looking at the homeowners from "easy application days" where anyone was approved. And everyone did get approved! And now we cant with all we are offering? Why are we being punished for other peoples irresponsibility?

And you know what annoys me? Once we buy this rental duplex...we will have 5 sources of income. 5! Now if Joe Schmoe gets a mortgage because he makes $80,000 a year and then loses his job 2 months after moving into his house- he's screwed. His income went down to whatever severance his job provides. But if we have 1 renter who loses their job and cant pay...we still have 4 other sources of income to cover that loss.

And my renter who has paid on time for the last 6 yrs is more reliable than some job obtained a year or two ago. And even if she was a new unreliable renter, If she loses her job, In this economy, I bet it's easier finding a new renter than a new job.

This duplex we are buying near a college has hundreds of potential renters. This place will always be rent able and has a rental history of 4 years with the same renter. I bet the country is losing jobs faster than schools are losing students.

And anyway, why is depending on a renter for payment considered more of a risky income than being dependent on a company for income when our country is in the middle of massive layoffs?

I still have my own human capital capabilities to seize in the event that my renter runs into problems. With a rental income there are 2 potential bodies able to create an income rather than 1! (does that make sense to you?)

I feel like the banks are telling me that my money is not as good as other peoples money because of where it comes from.

I just argued my own point so well I no longer feel like a loser. I feel like the banks are losers for missing out on my business.

I finally tallied up our November spending totals. Not bad. We went up in some places, down in others- all in all really helpful for me to gauge how we are doing financially.

Income has been steadily increasing. We made $1700 over last months income total (Thank you ebay).
Our bills increased $140 over last months bills (groceries). Our fun money spending decreased $200 over last month (though eating out increased $60).

So all in all it was a good financially responsible month.

This month however...is already off to a rough start. We are getting tired of the sacrifices and the raman noodles.

I got my pro pics in!!!! I love them! Thought I would share a bit because...I LOVE THEM!

only I am taking advantage.

I am packing my lenox china back up. Into the tupperware it goes. Off to sit in storage for a few more years.

Seems Lenox has declared bankruptcy. They filed Chapter 13 last week.

On the off chance that they completely shut down production- I am pulling the lenox from my listings to see if value rises in the future.

Anyone who has broken some lenox china and needs to find replacement items- the china is selling very inexpensively on ebay right now.

In other news- Seems Bratz dolls are infringing on a Mattel product and the Bratz dolls are being recalled immediately. All manufacturing molds and products were ordered to be destroyed. If you have a good condition doll...might want to put that item in storage for a few years too.

My best friend gave me a $30 Barnes & Noble gift card for my birthday (months & months ago) and I just used it to purchase some online items. Books are WAY cheaper online than in the store!

*I bought a beautiful garnet colored scrapbook to show off my wedding pictures.

*A dinosaur kit for my nephew for Christmas.

*"Debt proof your marriage" book by Mary Hunt. Someone (frugaltexan??) on this site recommended the book to me and I am finally going to read it!

I only had to pay $7 out of my pocket and shipping was FREE for orders over $25.00!!

So I am starting my November tracking...thought I would start on the ebay. It was a great month!

Started off slow because I got married early this month...but it picked up fast.

Grossed: $4,752
Ebay fees $190
Paypal fees $82
Shipping fees $861 (yeah the post office made out like a bandit!)
Packing supplies $11
-----------------
$3608

All in all- Great month- better than I expected. Every little $5 item really adds up! Go clean out your parents/siblings/childrens attics!

I'm just a tad nervous because I started selling dishes towards the end of the month...the items are hitting buyers homes now...and I'm so scared of broken items! I packed everything as well as I could- but I'm a big worrywart. Big sighs of relief once the feedback starts coming in.

And that was the fun part. Adding up the INCOME. next is adding up the months spending- not so fun.

AND!! The armadillo is still under the house! He's not dead because he evades the traps and still digs up the yard at night!

I hate obsessing about my housing situation. I know it either bores you all or I sound wildly optimistic about my economic situation in the face of all this doom and gloom. But bore or aggravate you I am about to do.

It just helps me think and weigh my options...writing in this blog.

So I went away on vacation over Thanksgiving weekend. While in the airport on my way home- one of the lenders I am working with called with bad news. She said based on our income she could not approve us for our desired loan. She said she cannot count the $995 a month rental income from the duplex we want to buy as our income because it will be our primary residence. So...even though we will live in one unit and have renters for another unit...that will not count towards our income. She said she has to keep our mortgage payment at 45% of our income. I guess I can understand that. BB and I have an extra 10k saved on top of the 20% down payment for renovations and such...I guess we could apply that 10k to the down payment as well. So I asked her "how much do we need to put down for this mortgage to be approved for our 200k request?" She runs numbers and says we need to put down $130,000. ??!! I quickly ended the conversation because we don't have 130k. I wish we did because then our mortgage payment would be less than $400 a month! Anyways- on the plane I was trying to figure out where her number came from- but $400 a month is 20% of our current income. Not the 45% she said was our limit. Whatev.

BB and I are not deterred. We refuse to give up easily. I understand that rules are in place, I understand that on paper we look risky, But I also know that whatever bank decides to lend to us is going to get every single payment on time.

This morning I got a hold of a broker through lending tree that has been harassing me wanting my business. He needs all our paperwork and said he thinks we will need to put 30% down and can lend us the rest. So heres hoping.

We had plans to put in an offer in 2 weeks- but the plan is also to have concrete lending in place so everything goes smoothly after negotiations.

Since we will be putting down the money we saved PLUS our renovation money...we are reconsidering maybe offering on the house I have mentioned in previous posts that was BEAUTIFUL in a less than stellar part of town. The place is nearly perfect in my eyes- I could easily live in it and have no complaints. The house we were planning to make an offer in the better neighborhood needs some big work before we even move in.

So...it seems we are reconsidering our thought process now that we will no longer have "fix up" money. But as a plus; our mortgage payment will be smaller! We might be able to stretch the rental income to cover the mortgage AND insurance! Holy cow that would be great!

So that is where we are at. We are not taking the setback as a sign to not go forward- we are ready for this commitment and now we are looking to get creative in the financing department.

And in closing- the news has announced possible plans to DROP new homeowner interest rates down to 4.5% in the next few months. I think I am somehow blessed that it has taken 3 yrs to save up a downpayment...we have had minor stallings in getting a mortgage...because we might get incredibly lucky and buy at a time that the govt is offering a $7500 tax credit AND a super low interest rate for new homeowners!

I know it will all work out fore me. I'm just impatient!!

I have not dropped off the face of the earth! I went to New England for my high school reunion- got back this morning- no thanks to the airlines- and have a ton to do. Cant wait to read all your entries though! And write some of my own. And tally up the November spending!