Tuesday, March 24, 2009

How and Why I Got Here - A Follow Up Post

I've gotten quite a few comments on my "Why I Bought A House I Couldn't Afford" post that have made me realize that it was incomplete. I quickly jotted it off with my regular readers in mind, but I had forgotten that I have gotten quite a few new folks on the site and they may not have all the back story. I should have be been more clear. So, to make up for my lack of detail, here's a little follow up post -

I was divorced in June of 2008. My husband and I had our marital issues, obviously, but none of them were financial. Had we stayed married, I have no doubt whatsoever that we could have weathered this financial recession without any problems. Oh, we might have had to be a touch more frugal, but no more than anyone else in these times. I have a good steady job and he has a successful business. We would have been fine. You want a great financial tip? Don't get divorced. The cost of lawyers, court costs, and having one income when you are used to two - it adds up!

But the truth is, money isn't everything, and as anyone who has been divorced can tell you, it certainly isn't enough when you are miserable. It so happens that our marriage couldn't last. I'm not going to go into any of the gory details because this is not the place for it, but suffice it to say that I moved out in May of 2007. I lived by myself for a year in a tiny 400 sq. foot apartment as we tried to figure out our lives. Now, let's get down to the financial nitty gritty shall we? Here's how I ended up where I am now....

The agreement we had when my ex and I split was that he would keep his rental property (which was his before we met) and he would take the house. I would take the cabin. If you've read my post about the house, you know that he paid the lion's share of the house and I paid for the cabin and some of the house. In dollars and cents, this worked out to about equal. In reality, it meant that the cabin felt like "mine" and the house felt a bit like "his." So, the division of property made sense - we each got a property from the marriage that we had paid for. The downside was that we would both have to stretch a bit. He'd have to find a way to cover my share from the house and I would have to find a way to pay for a place to live and pay for the cabin at the same time. This was all fine and dandy until one day he told me he didn't want the house anymore and was "giving it back" to me.

That was the day I got a lawyer.

The lawyer and I discussed a number of options - everything from a short sale on the house to taking every
single piece of property and all the assets that my ex and I both had and throwing them into one big pot and dividing them down the middle. Every solution we came up with was ugly and would have dragged out the divorce process and made it even more miserable. We did put the house up on the market, but I didn't expect it to sell - by January of last year the bottom of the housing market had already fallen out, and there was nothing moving. The realtor himself told me he had 18 months of houses already on the market just like mine and his projections for selling it were gloomy.

That's when the lawyer suggested that I consider keeping the house. "It's a nice piece of property, in a great neighborhood," he said, "what about getting a couple of roommates, sticking it out for a couple of years? Do that and you'll be able to sell in a few years for a nice chunk of change - think about it." So, I thought about it. What would happen if I kept both properties, the house and the cabin?!? It was a wild, radical thought. But the more I thought about it, the more it seemed possible. For many reasons I have written about before, I didn't want to sell the cabin. (And even if I did, I'm not sure I could have with the market being what it is.) But to keep the house too.... could I do it? The house was a great investment property, and though property values have dropped like a stone, I am confident they will come back. This house is in a fabulous area and has so many features people want. The more I started thinking about it, the more I started thinking that of all the many ugly solutions that my lawyer and I had come up with, this was possibly the "least" ugly.

Would I have bought a huge, wooden Victorian house, built in the 1800s on my own? Of course not! Would I have bought it and the cabin by myself? Not on your life! I wouldn't have even bought the cabin on my own. In my marriage two homes made sense, my husband was really handy, he and I could care for two properties. On my own it seemed absolutely ludicrous! And yet... what was the worst that could happen? I could fail. I could lose the house to foreclosure. It could ruin my credit score... but those things could happen if the divorce fight went on and on anyway. On the other hand, if I took the house the divorce proceeding would go smoothly, and I could get out of that mess. It would mean I would have to come up with an extra $900 a month, but my lawyer was right, if I could sweat it out for a few years, I would have a couple very nice properties I could sell.

So, in the end, that is what I decided to do. Was it the smartest decision? I don't know yet, but I will say this, I have not paid a bill late yet. I've kept my credit score as "excellent" and I haven't had to get roommates. I think my story surprises people because usually it is the man who gets the "fuzzy end of the lollipop" when it comes to divorce. In this case, not only did I take on the financial burden, I did it willingly - not because I had to, but because to do otherwise would have made the divorce all that much harder, and frankly, he and I were hurting enough as it was.

Am I over mortgaged for a single woman? Heavens yes! I'm not complaining about it though. I try never to complain in this blog - even on months where the money has been slim, I don't want to complain. I made this choice and I am doing all I can to make it right. Plus this has been a wonderful opportunity for me. I have learned so much and I am holding on strong. Bills are being paid, an emergency fund has been created and I see a lot of potential for the future.

I started writing this blog for a few reasons. The first was simply that I had so many ideas and thoughts about making and saving money running around in my head that I needed one place to put them. I wanted a place to track ideas, try new things and also read what others were doing. I wanted to share my success stories. There are a lot of folks out there who need to make extra money each month - I wanted to show that it was possible to do. There are options out there! There are also things that don't work. I wanted to share my experiences with both. Though I wouldn't go so far as to say it has been "easy" it has been simpler than I would have thought. We all have the power to do some pretty amazing things if we put our minds to it.

In just a few months I will have my car and my credit card paid off. I won't need the full $900 anymore. But you know what? I'm not going to stop. I have other big financial goals. I still have a house that needs painting, a emergency fund that needs more funds, a dream of going back to school for my Masters degree. I now know what can be done with a little effort and few sacrifices. I hope that my blog can be moderately entertaining coffee break reading for others and also help out a few folks that some extra money. I'm hoping that maybe someone who was thinking about foreclosure sees this and decides to hang on just a little longer.

Failing all that, this is still my favorite place to sort out all my financial ideas.

Photo by: Meredith_Farmer


Meredith said...

Thank you for the link back to my photostream - I posted a link to your blog in the caption of this photo.

- Meredith

Dawn said...

Sure Meredith! It is a gorgeous photo and it made me smile. Thanks so much for letting me use it.

Michelle said...

Hi! I posted last time & just had to iterate, you are an inspiration - doing what it takes to get it done (and not whining for a handout). in follow-up to your comment...thank you, yes - my house was listed on the April 2008 auction list - we scraped together the $$ to keep that from happening and 12 mos later, my whole financial life has turned around! My DH got a fulltime SALARIED desk job (he'd been a field/construction type before his injury and disability) last summer, and Hallelujah! We can now, again, afford our home.

(Some) People are getting really judgy in retrospect with regard to the 'crisis' - and I'm sorry some of those anonymous people didn't take the time to read your story and understand your situation.

Dawn said...

Michelle - WOW! Good for you! That is awesome - and congrats to your guy for getting that job!! Because you and I have been through tough times we understand the true stories behind people losing their homes and their jobs. I have so many friends out of work right now... one gal had been at her company for 22 years! She never saw it coming.

I love stories like yours. That's what inspires me. It can be done. Oh, life may suck for awhile :) but it is possible to turn your life around. That's what you and I are after.