A quick update on our financial situation, as outlined originally in this post…
We applied with both of our mortgage companies for a load modification. Our second mortgage (20% of the loan) responded within a few weeks, and offered us a temporary relief program that cut that payment in half for a little over a year, with no strings attached. That was a pretty sweet deal, and it’s definitely taken some of the pressure off. It wasn’t enough to get our monthly income/expense ledger back in the black, but the red number at the bottom is a lot smaller.
Our first mortgage company has had our application for about 4 months now, and according to our last conversation with them, they are supposed to be contacting us “any day now”. All the paperwork is in order, and they’ve confirmed that we made it through the initial screening – at this point, it’s just in the the hands of the main decision makers, and they’ll be calling us with an offer shortly.
Meanwhile, Betsy and I have been daydreaming…
Reading the book Your Money or Your Life
has led us to rethink some of our fundamental assumptions about housing. What is the real value of our house to us (over an apartment)?
- It’s an investment, but a highly illiquid asset at a time when liquidity is needed, and one that has performed extremely poorly recently with a cloudy outlook for the near future.
- It’s a garden we can design and maintain, but we have neither the time/energy to maintain it or the finances to buy new plants.
- It’s a place we can call our own, and loads of stress that we can call our own as well.
- It’s a lawn that Seth can run around on, making things like visits to the zoo, fun toys, trips to visit family, or someday even preschool unaffordable.
And the list goes on from there. Buying a house is a “thing that young families do”, but does it make sense for us currently? Are we getting appropriate value for the amount of life energy we’re pouring into work and stress?
We’ve allowed ourselves to daydream about other options. What if we lived in an apartment in the Mill Creek area? Drives to visit our friends would be 5 minutes instead of 45, and 30 minutes to my parents instead of 70. We’d be able to set aside a small sum for personal purchases (dinners out, toys, new clothes), increase our charitable giving and still be able to save substantially for the future. We’d be able to focus on the values that are core to our lives – fellowship with family and friends – and not spend that time/energy worrying about a piece of land. I’d miss White Center/West Seattle something awful – the food and culture around here is fantastic – but we value people, not places, and we could always have weekends set aside to come down here for grocery shopping, tacos from a taco van and ice cream from Full Tilt. Betsy noted that she’s trying to not get in a “grass is greener on the other side of the fence” mindset, but it’s easy to do when you wouldn’t be responsible for watering, fertilizing and mowing that green grass.
In a way, we’re almost hoping that the mortgage company refuses to make a deal, and our hand is forced. What would it look like if we stopped paying our mortgage and lived for “free” for 10-12 months while the foreclosure process went through, saved up all that money that we had been paying every month, and then moved into an apartment with a savings account that had a decent pad in it? How badly would that limit our options for the future, and would that be worse than the limits we’re facing on our present? Obviously, there would be a lot to consider if that was the only option available to us… but the silver linings on that particular dark cloud are interesting to think about.
We’re still waiting for the mortgage company to come to a decision, and the most likely scenario is still one in which we stay in our house for a while yet to come. We’ll need to make some decisions about what makes the most sense for us, for our values, and for our future.