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Archive for October, 2008

Finally! Short sale approved

October 31st, 2008 at 06:42 am

Now comes the mad rush. The short sale bank wants the closing to occur before the 24th. So, I have emailed a home inspector and we have applied for an insurance quote from a company my DH works with and DH is sending all the new information to our loan officer so we can finish the loan paperwork.

Once I know which day the home inspector can do I will set up the rooter guy to inspect the pipes at the end of that. DH will ask the loan officer about the survey and the title commitment since we aren't sure who is doing what. The email from the realtor implied she was handling title and we were handling the survey but I think the bank will actually do both so hence double checking. I think what it actually is that not all lenders do surveys and that the realtor is going to start talking with our loan officer.

We won't have time for any mistakes. We are telling the loan officer to shoot for closing the 21st so that we have an extra day in case something goes wrong. Not to mention that gives us an extra weekend in there to get things done on the house.

At this point there is still a couple of ways that this can all fall apart but we are hoping for the best and trying to make sure deadlines aren't an issue.

Okay, even I am starting to get impatient now...

October 30th, 2008 at 12:45 pm

For the short sale approval, all that's left is for the VP of the bank involved to sign off or offer a counterproposal. Supposedly that is going to be happening this week (its already Thursday folks). Well its been a month already and we are finally getting antsy. We want this place and we are ready to get started.

Wish he would hurry up *grumble, grumble*.

We have been working towards the goal of owning our own home for 2 1/2 years now and we started with a -60k net worth so we are going to be extremely frustrated if we end up not getting this place and not finding anything else in the next couple of months so have to rent for another year. Yuck.



1 item down, many more to go but not right now

October 27th, 2008 at 12:43 pm

I have 2 appliances that I will want/need for the house we are buying, a washer(need) and a refrigerator (want). We decide that since we need to try and keep prices down, we need to see who sells what at what prices.

We went to Sears on Saturday to see what kind of deals they had. We discovered a lovely little section that is clearance because items are floor models that they don't want to have out anymore. Oh boy. The deals look decent and we decide that when its time to buy we need to come back. Then I see my frig, the one that on sale with rebates costs about $1500, the one I am never going to pay that much for so I probably will never own it. They had a model in black for $734. Needless to say my jaw dropped.

I think about it for 10 minutes. Discuss it with the hubby and I basically decide we can't afford to pass it up. Go back, grab the salesman and tell him we want to buy the frig. He walks over and actually flinches a little when he sees the price drop on it (glad to know that I wasn't the only one surprised by the price decrease).

No installed icemaker or water dispenser which is the only reason I can think of for the lower price (normally factory installed which drives me batty because I don't like those features, I consider them a waste of space). So he calls the manager over to discuss a warranty. I listen to the speel, I like what he is saying but in the back of my mind I am not willing to pay a fortune for a warranty.

He offers the 5 year warranty for $150 (free maintenance, parts, repair and replacement if repaired more than 4 times). Personally I consider that a steal because I have seen the repair bills for refrigerators and all it takes is once. I figured if I buy the warranty I will never need it which is better than not buying it and having it break in less than a year Big Grin

So warranty, delivery, and frig for $1000. Very happy about that. Hopefully they will have a similar deal on a HE washer when I go back. And I am not going back till I have the house because I don't want the apartment that full of boxes, lol.

Only reason I got the frig is the deal and knowing that in my price bracket, none of the homes have a decent frig. So no matter what, I will be able to use my new frig and donate whatever one comes with the house to a local charity (they work but we always run out of space in our current frig, not to mention some of the awkward spacing issues).

This was a definite splurge. Not even remotely a necessity. And I must admit, I have no buyer's remorse. We have the cash for it and this was planned in our budget. I am still bouncy and thrilled with the purchase.

Oh and we also discovered that the kitchen does have a vent so we won't have to do anything to the kitchen immediately.

Which is good, because I plan on the washer and an electricity update for when we move in and the rest I want to hold off on until we have a nice large nest egg to cover any emergencies.

Thoughts on what I am getting myself into...

October 23rd, 2008 at 03:31 pm

The house we are buying is a fixer upper. I already know certain items will need to be fixed. Both the bathroom and the kitchen lack any ventilation. The kitchen of course has a gas stove just to make life interesting. We are going to have to upgrade the electricity so I need to figure out what I want where eventually so I can do everything in stages without having to undo what I have previously done.

Course all of this could be moot. We could find out something horrendous about the house that makes it unlivable during inspection or the bank could decide they want to foreclose instead of sell. I am just the type who plans things out way too much, lol. But to be fair, taking into consideration everything that needs to be fixed is part of the house buying process.

October net worth update

October 22nd, 2008 at 09:57 am

We improved the net worth another 2k despite the down market (investing more than we have lost). Most of that is savings though we finally have enough for everything (technically, we both want about another 2 weeks to feel comfortable).

We have been brainstorming the most effective ways for upgrading the house where necessary. First we dreamed big and now I am figuring out how to be more realistic, lol. The cheaper method allows us to upgrade everything that matters except for the bathroom right off the bat. I am still trying to get that cheaper where possible without compromising on quality or ignoring something important.

Course all this may go out the window if the inspection turns up a nasty surprise that needs to be dealt with immediately so we shall see. Ah the joys.

I have a feeling that November is going to be a whirlwind...

Weekend Review

October 20th, 2008 at 11:22 am

I cleaned up the balconey this weekend and took apart the last fish tank that needed to be taken down before we move. With slightly more than a month to the move and a major holiday in between now and the move, I have been hesitant to pack too much. As a result, our packing has been low stress and unrushed.

We ate out a lot this weekend and I spent money on items that were not a necessity. I am rather ambivalent about that given that we have been aiming for only 20% of our budget being spent on wants and I am beginning to suspect that is a little too low to be sustainable. We have plenty of wiggle room to allow it to go higher so I think for now I won't worry about it and will just make sure to keep the overrun at a minimum.

We did price out some of the items we want for the new house and were pleasantly surprised on how low cost we could go on the home gym equipment without skimping on the items that matter to us.

We still have a week or two before we hear back about the short sale so we are still treading water there though my real estate agent did send me a no update yet email today.

Oh and one thing I have noticed. The best way to get my husband to serve me my sized portions of ice cream is ice cream cones. I have never been able to have a quart of ice cream last this long before, lol. Must remember to keep ice cream cones on hand in the future.

New Budget Planning

October 15th, 2008 at 08:25 am

November 10th we will have all the money we need to close on the house and then some so no real need to track that anymore. Will probably switch to an emergency fund tracker since we will need to replenish that and just plain build up regular savings.

New Budget (when we get the house)
Savings 25
Roth IRA 416
Student Loan 193.6
House Payment 1233
Insurance and Taxes 200
Electricity 120
Water and Sewer 70
Credit Card (paid in full) 1318

On the Credit Card
Cable 62.11
Phone 71
Netflix 15
Bus Pass 70
Groceries,Out to Eat and Fun Money 1100

Remaining 424 would go into the EF.

This is a lot tighter budget then I am used to. 1, DH will be maxing out his 401(k) and 2, I will be maxing out my Roth IRA. That's not quite $1700 per month thanks to the tax advantages but ouch. Course what you aren't seeing is that we have been living on a much tighter budget than this, its just we had the illusion of more money because we were choosing to pay so much on the credit cards to get rid of them.

A big issue with this budget is electricity, garbage, water and sewer are a big question mark. I way overestimated electricity to cover garbage but electricity is the only bill I have ever paid when in a house (currently live in an apartment so I know what I pay now but that won't necessarily translate).

Actually electricity was cheaper in a house than an apartment so I am hoping it will go down but I am not holding my breath.

Another thing you will notice about the new budget is that it is one budget instead of two. My DH and I will be alternating control of the entire budget so that he can get an overall view of what we are spending. In the past I always made sure all excess income was in his wallet not mine because I didn't trust myself not to spend it. This resulted in him having one little bill and lots of free money. Hard to stay in budget if you see no reason to. This will give him the opportunity to see the big picture.

Hopefully this will eliminate the "what do you mean we spent twice we are supposed to, why didn't you tell me no?" situation since I am always the instigator of spending money but couldn't see his side of the equation in order to self regulate (he can't say no to me, trust me, I only think of this as a bad thing when it comes to our finances, I am spoilt and loving it).

Overall, I think we are doing pretty well but I am looking forward to March when everything has been switched over and all the chaos is over.

Still no heat but the weekend may bring snow...

October 10th, 2008 at 01:13 pm

So who knows if that will last the weekend.

I think this weekend after grocery shopping we are going to be hermits and hide in our apartment all weekend long. We were constantly on the go last weekend so we feel seriously abused. On a financial note, that should keep the expenses low since the weekends are when we spend our money.

Everyone have a good weekend!

Hurry up and wait

October 8th, 2008 at 10:23 am

Our bid was accepted and we got the signed paperwork today which is great but now we wait 2-4 weeks for the short sale approval.

At least we know we will have plenty of cash for the closing by the time it takes place.

Just put a bid on a house...

October 5th, 2008 at 09:32 am

Oh boy. So bid is in. We will end up with this house if the following go well:

Sellers accept the contract
Bank approves the bid (this is a short sale)
House appraises for the bid amount
Home inspection goes well

Yuck.

There are no real comparables for this house. Fully remodeled, it would go for a lot more (add another 100k+ even in a down market and they go in less than 5 days at that price). Big issue, its not remodeled. It needs lots of work. It also has a basement and the cheaper homes in the area do not. So our Realtor isn't sure it will appraise high enough. Not that she thinks it will appraise low, she just doesn't know what they will appraise it for since this neighborhood doesn't sell homes very frequently.

Bank approval of the short sale should go well, the other agent just had a contract fail at that number due to down payment assistance disappearing as of Oct 1. Incidentally that's why we made the offer there. It is a discount of 8k and if it doesn't appraise there, it will quicker to have an appraisal come back too low then to have the bank reject our first offer and then go through the whole process anyways.

I am really not too worried about the home inspection. This house is valued so low and has so much potential that its a steal even in this market. But the missing water heater will need to make it back there before inspection. This was a rent to family while we buy a new house deal that went very wrong. On a positive note, that means that the sellers are in a better position to help out and the utilities aren't way behind as a result.

Wow. This is going to be a major project. But definitely worth it if we can manage to get the deal to go through...

Need to remember its okay to enjoy life...

October 3rd, 2008 at 03:10 pm

I tend to see myself as a spender so I always seem to think I am spending too much on wants. But, according to the 50/30/20 (needs/wants/savings) rule, I am not even close...

My ratio is more like 37/19/54 and is going to be 55/27/19 once we have the house (401(k) doesn't get counted in this formula because its after tax and we will start maxing that in January).

The reason this is kind of important is because I feel guilty that we spend so much on our entertainment right now and especially guilty that was/am planning to raise the amount after we get a house.

I need to stop feeling guilty and just enjoy the fact that we have completely cleaned up our act. Not being allowed to spend anything on myself in college is part of the reason we went nuts after we got our careers started.

The weird part is that I have checked this formula before but I guess I was convinced that I was somehow out of balance again.

Do I plan on eventually raising the savings amount? Most definitely, but for now maxing out the 401(k) and saving 20% of my after tax money is perfectly fine.

Need to rearrange my living room

October 1st, 2008 at 09:42 am

This is totally not finance related.

I don't tolerate clutter well. Once things get messy enough, I tend to rearrange everything in order to make my spaces look open and airy. My living room has definitely violated my clutter tolerance. I think I have an idea for how to organize it so that half of the items currently in my living room can be packed up for the move while still leaving us things we can use.

Normally I feel sorry for my DH when I rearrange but I think the clutter is getting to him even so he's happy I will be rearranging.