Our Story – Part 2: The Panic

I’ve always been interested in personal finance, but it never “clicked” for me until the end of 2011.  Before Daughter Person was born, we didn’t budget, we didn’t do more than the minimum for saving in our 401(k).  As long as the cash flow was OK – I thought we were OK.  We always had money in the bank, never made a late payment, never even had to time our bills to our paychecks, never been declined/denied for credit, and always had available credit on our credit cards.  So we thought we were doing good.  Obviously, I (at least) had my head in the sand.  This is our story.  It’s not intended to be an excuse for our poor decisions, but to give some background.

Part 1: A Tale of Two Houses

During 2009-2011, we were paying 3 mortgages on 2 houses, and still had about $2k/mth left over for eating out, buying things, etc.  We figured we were pretty flush.  I didn’t *like* having to fix things on our remaining townhouse, and was trying to patiently wait until the two years was up to see if we could sell it.  Daughter Person was born in January 2011, right as the renter’s lease was up.  I had met the Realtor in November to see if it might be worth selling, and notified the renters that I wouldn’t be renewing their lease.  When I hauled Daughter Person over to the townhouse to meet the Realtor, I was frankly disgusted at the mess that the renter’s left and started trying to pursue keeping their security deposit – turns out since I wasn’t re-renting it, the county laws said I couldn’t keep it (boo!).  So, we spent about $7k on fixing it up just to be presentable – we had to paint, replace carpet, replace closet doors – a huge mess.

We listed it in March, and got our first offer in April – the buyer backed out in May because he didn’t like the condo rules.  It went back on the market and we had two offers in July – I took the offer for the person who would be living there, not the investor, and turns out that was a bad decision, despite her pre-approval letter that said she could borrow *way* more than the value of the house, the lender wouldn’t approve her.  Finally, I got an all-cash offer in September, and through a hilarious sequence of events, finally made it to closing – where I brought $8k (borrowed). Yes, I basically paid to get someone to take the property off my hands, I was so tired of it at that point.

And this experience is why we have no intentions of ever owning rental property as a second income stream.  I know we could do it (and make money on it), especially if we selected an appropriate property, but we just don’t want to.

Meanwhile, I go back to work in April, and Daughter Person goes to daycare, at $1600/mth.  Now, we’re down to $200/mth extra and trying to fix all of these problems and issues with the townhouse.  I start to panic about how we’re going to survive, etc.  I can be a bit of a drama queen when things look bleak…

Part 3 – The Awakening

2 thoughts on “Our Story – Part 2: The Panic

  1. Pingback: Our Story – Part 1: A Tale of Two Houses | Three is Plenty

  2. Pingback: Our Story – Part 3: The Awakening | Three is Plenty

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