I’m sure lots of you can relate. Times are tough. Personally, I’ve never even considered foreclosure a viable option. All else aside, I believe signing on the dotted line is a promise and it’s my responsibility to keep that promise in all but the most dire circumstances.
But times are tough.
We bought a little over 2 years ago (May, 2006) at very near the top of the market. People had been telling us - respectable, intelligent people - for years to get in while the getting is good. You’re throwing your money away renting. Buy now or you’ll never own a house. Real estate is never going down.
We searched patiently for about a year and a half while prices soared. Finally we bought the first house we could afford that wasn’t in a bad neighborhood. It’s cute. Pool, good location, decent-sized yard for the city. Tiny, though. Two bed, 2 bath, and only just over 1,000sqft. It was triple what we were paying in rent, but it was ours and, hey, we weren’t throwing our money away anymore. Except we are. We took the 10 year interest-only option, of course, on a 5-year ARM.
At first it wasn’t difficult at all. We had been saving a ton of money renting and were still able to pay all the bills here and add to the savings account every month. Then, 8 months later, I got laid off. I worked in the mortgage industry, see. I never finished college and it was the only “adult” job I’d ever done, aside from a few months as a computer tech several years ago.
So we decided together that my wife would pick up another job and I would get a part-time job and go to school (she already has 2 degrees and is in her career - I still don’t know what the hell I want to do.) It’s been tough, but it’s kind of sort of working out for us. Our savings account is no longer growing, and it shrinks everytime an unexpected expense comes up, but in a regular month we make just enough to scrape by. And I’m doing great in school. I should have an associates degree as early as this fall; next spring at the latest.
The house, though, is in disrepair. The pool needs to be acid washed at minimum (several hundred dollars), but realistically it needs to be re-plastered and re-tiled (several thousand.) The deck needs to be painted. The pump will need to be replaced soon. The air conditioner has broken down 4 times in 2 years. All the appliances are wearing out, except the new washer and dryer we bought we we moved in. The exterior paint is fading and chipping, the shingles on the roof are fading and warping, the windows are downright drafty. The garage door is warped, as are the double-doors leading from our bedroom into the backyard (the Phoenix summer does brutal things to a house.) All the cabinets, countertops, and lighting fixtures are showing their age. I think the carpet might be original to the house (1985). These are all things that would need to be fixed before we could sell.
And it’s dropped $42,000 in value since we bought it.
And we just found out we’re having our first child.
The pregnancy was unexpected, but we’re absolutely thrilled about it. Very excited. But it could not have come at a worse time financially.
I’m not saying we are going to let our house go into foreclosure, but we had our first serious discussion about it last night. We could be stuck here for 10, 15, or more years waiting for it to appreciate enough to sell, while meanwhile the payments eat us alive. And it’s not like this is the only child we want. We can’t raise a family in a 2 bedroom, 1,000sqft house. A lot of my friends’ apartments are bigger.
Just some random musings. I don’t feel so comfortable talking with my real life friends and family about this, so thanks for reading.