February 10, 2009

Pickling in a Brine Of Our Own Creation

It started with this, a home purchase tax credit. A credit of as much as $15,000 ( or 10% of the purchase price, whichever is less) to anyone buying a primary residence during a one-year period. That is ten percent of your purchase price, handed back to you in a big fatty fat lump sum come tax time next year. That's free money for doing what most Americans want to do anyway; fulfill the American dream and become home owners.

It led to this, a listing on Craigslist for a property just down the street from us, for sale for just pennies on the dollar from it's previous listing price.

Which brought us to her, who showed us this, literally across the street and with a desperate owner who will take a good $20k less then listing price, and gave us the contact information for this guy who apparently works magic as he crunched some numbers and gave us a big fat thumbs up.

Which lead to thoughts like this.

But the brine of the pickle that we're in, it is thick and pungent. And while normally I like pickles, some might even say love pickles, I'm not so fond of them when it's a pickle standing between me and the American Dream.

When I was 19 years old my then boyfriend (now husband) and I took some advice and bought our first home; a condo in Tacoma. A condo that we absolutely couldn't afford. At all. And when roommates were flighty we were left with a long commute, a big bill, and no way to pay it. So again we took some advice and sold that same said condo. Trouble is, HOW we sold it. We had only lived there a year and the market wasn't booming in any sense of the word. So when someone pointed us towards a creative financier/home buyer who could give us cash NOW we jumped on the opportunity. Long story short, this man paid us $1,200 for our condo, we signed over all rights to him ( including the "right" to make the mortgage payments), and got the hell out of there. Sounds easy, right? Not so much. See, we signed the house over to him. He finds a long term lease person with credit issues and "sells" the house to them on a lease-purchase. After a few years, ( "three to five years on average") that persons lease comes due and they get a mortgage, with their years of payments as good credit, and buy that house from our buyer. He makes a pile of money, they become new home owners, our name is taken off of the mortgage. Sounds great, we got the thumbs up from our advisers, so off we went about our lives, giving it no more thought. Well that was stupid.

Yesterday we applied and were qualified for a home loan. Holy crap on a cracker, was I surprised at what we could afford! We could do it! Be home owners! Get out of this rental rut and take that next real adult step, now, when we're ready to do it! But wait. Turns out we still have a mortgage in our name. The Tacoma condo. An FHA mortgage, the kind of loan you can only have one of at a time. The only kind of mortgage loan that you can get for no money down. And it turns out, the only kind of loan on the market that we can't qualify for while also being the only loan on the market we can afford. All other loans require at least 10% down payment. By the time we've got 10%, the house will be gone. I'm sure the FHA won't take an IOU for the 10% promised by the government if we buy the house in the first place. Which means we're screwed, for the next 22 years possibly ( if he decides he's just never going to flip that mortgage, which is likely considering new investigations find that man being sued by the State of Washington for foreclosure/mortgage fraud and our home purchase was one of the few legally done and therfore the one buying his breakfast.)
And it's all our own fault. Yes, we were following advice of others. We were young and stupid. But ultimately it was our decision both to sell in this questionable manner, and to buy in the first place. No one MADE us sign the paperwork, we did it all on our own. And now look what happened. Good chance we'll not be home owners for a nice long while, it will take us years to accomplish that American Dream. It's a bitter pill to swallow because we've been working very hard, spending very carefully, acting very responsibly, for the past few years just to get to the safe starting place we're at now. And it turns out that we can't even utilize it. Turns out our starting place is actually several years in front of us and our goal was several years shy. All because of a pickle created when I was 19. GAH.

All of this is to say RAEGAN. When your old enough to be making these decisions, DON'T LISTEN TO WORD I SAY. Read through, HIRE an attorney to read through, take your time, weigh your pros and cons, and make that decision all on your own, fully informed. DON'T rely on me or your father to be voices of wisdom. We're probably full of crap. IF what we say ends up being wise, know that it was your thorough analyzation of the situation that made it so, not any smarts on our part.

Rant over. Off to eat some pickles.

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