Timeline of foreclosure – 2

Chapter 2

This is Chapter 2 of the story that led to our current state of not really feeling as though our housing situation is stable. Read Chapter 1.

3)      During the 2003/2004 school year I used the profits from the sale of my California home to live on, pay court fees, and to hire an attorney. The GI Bill paid for my classes, which were $11 a credit back then – nice!

I chose my classes so that I had a regular daytime, Monday through Friday schedule, for the first time in my life. It was great to be able to attend morning assemblies with my daughter at Ridgewood Elementary School before she started second grade classes each day, and to be home to meet her at the end of the driveway when the bus brought her home. I was free for weeknight book sales and free to schedule parent-teacher conferences at a normal hour. If for no other reason, being able to participate this way in her expanding life was worth giving up my well-paying job as a weather forecaster with the National Weather Service.

Other than that, I had my doubts.

I wasn’t rich, but up until then, I had plenty. The kind of comfortable life where I could go buy a new winter coat for my kid when she lost hers (that seemed to happen a lot). When I fell in love with some real leather, knee-high boots, I could take them home. We could go to the movies on the spur of the moment. On a particularly lovely Fall afternoon, we took a Humboldt Bay cruise on the Madaket just because we wanted to, and then stop for ice cream at Bon Boniere on the way home. It was a very good life.

After I decided to leave my job and go to school instead, I made serious cuts in my lifestyle where I could. But life can be expensive.

At the end of the school year in Cali I was able to move to Massachusetts. I had managed a painful compromise plan of physical parenting rights. We split her remaining years as a minor, and her father got the first shift. It shattered me to have to share at all, but making the best of it, it meant I could go to school anywhere. I considered living in Brandeis dormitory housing on campus to save money, but just couldn’t bring myself to rent after having been a homeowner for so long. And when my little girl was with me, I wanted her to have a real home.

4)      I took the gamble, which tends to be my personality. Big Chances = Big Gains (or Losses, as the case may be) I bought a house that was shockingly expensive for me, but I wasn’t worried. Real estate was shooting upwards like a rocket. Property values in the Boston area were DOUBLING every 12 months. Besides, this was my fifth home purchase, and I had learned that buying and selling a house was a sure thing. Once  I had lost $30 thousand of my investments…and in that same year I gained $30 thousand in the value of my home. There was no way to lose in Real Estate.

I was a bit surprised to get the loan without a job. But… I put over 20% down, had thousands in savings, had thousands in retirement account that I could borrow against, I had a work history of 11 years of federal service, and my credit score was stellar. So it wasn’t that hard for me to believe a lender would take a chance on me. The lender asked me how I intended to pay the mortgage, and I said “with student loans.” I was serious. And ignorant. Everyone who goes to school gets a loan, right? At great rates right? In my mind it made total sense to get student loans to pay the mortgage.

5)      I planned to rent out the lower level of the house. It was a spacious split level, and the lower level seemed like a decent space to rent. That would definitely help with the bills. But I couldn’t find a renter.

6)      I had some difficulty getting my financial aid into place. I got a threatening letter from the school that said something like, “If you don’t pay your tuition now, we will kick you out!” Having been out in the world long enough to think I had to handle everything on my own, I didn’t realize that the best option would have been to go to the Financial Aid Office and ask for help. Instead, I put my first year’s tuition on my credit card. Nope, not just a semester – the whole damn year. Duh.

Turns out, I didn’t get to live on student loans like I had assumed. (You know, there are a lot of assumptions to overcome when a person is the first one in her family to go to college) Turns out, there is a cap on how much a student can borrow. Turns out, owning a home is reflected as wealth when the Financial Aid Office crunches your numbers. Though I had a $1600 a month mortgage payment, the house was considered an asset, and thus reduced my ability to borrow.

My first bout with poverty struck, and it was a blow.

My spending continued to be outrageous, but I wasn’t getting much pleasure out of it. I ate Ramen noodles, but forked out the dough to purchase cross-country flights to continue my relationship with my daughter and to make my California court dates. (Still battling family law two years down the line. Little advice – never attempt to reorganize a family in California) I continued paying my attorney. I had to spend on basic upkeep of the home, landscaping, maintenance, snow removal, public transportation passes, and school books are expensive, even when you buy them used.

Needless to say, I began chopping away at my retirement account, which had recently made it above $100 thousand, but wasn’t destined to remain above. I was selling stocks to pay off credit cards. It just didn’t seem right.

It actually REALLY wasn’t right, as my financial advisor told me later. But… how does a girl learn good lessons without some pain?