Tuesday, May 22, 2012

Adventures in First-Time Home Buying: Ponying Up the Money

Saving My Money to Buy a Dream


I'll be honest, when I decided to purchase a house I knew about having money for a down payment and closing costs, but was naive about other expenses.  I've never been good with managing my money nor have I been good at saying "no" to others who ask when it comes to fundraisers - raising funds to provide wigs for bald squirrels? If you asked, I probably donated to your cause.



I've also had to pay for work-related expenses out-of-pocket. Sometimes I was reimbursed and sometimes I wasn't. Many times, I ended up building interest on the charges. (I've blogged about 10 Ways Business Travel Has Dug Me into Debt over on my solo travel blog.)

I Need a Magnifying Glass
To save money, I did something really stupid. About three years ago I opened what I thought was a savings/retirement account in which I've been banking $400 a month with hopes I'd use it either to: pay off my credit card debt, use it for a home down payment, or use for retirement in addition to my employer retirement account.

When I reached out to my realtor, I had assumed I could tap that money but my heart sank with the account executive told me the only way I could liquidate it was due to economic hardship. Apparently, rent increasing $120 with a salary smaller than when I started my job four years ago didn't constitute economic hardship. (Now I'm paying $220 a month more in rent because I'm going month-to-month.)

I'm not sure when I can ever tap that money and that's for another day, but I was in a situation of coming up with funds for a down payment.

Ponying Up Closing Costs and More
By chance, I learned about U.S.D.A. loans, a 100 percent U.S. government loan which took care of the need of a down payment. Working with the mortgage company, he was able to secure one of these for me - since the area where I'm buying is considered rural. Does this mean I can raise some chickens? Hmm...

Anyway, it was determined how much I would need for closing costs and I thought I was done with funds needed to buy a house.

Nooo....

To date, I've spent just under $1,700 for:
Home Inspection
Termite Inspection
Roof Inspection
Appraisal
Septic Inspection
Water Inspection
Well Inspection

The kicker is, financing is dependent upon multiple things including water quality. I haven't received the results yet and if it fails and the sellers don't do anything to fix the problem, I'm out all that money, which has been making sick! When I gamble, I play the penny slots. Losing $1,700 is a big chunk of change for me.

I still have to pay for a survey and another termite inspection - because it needs to be done within 30 days of closing.

So, sorry if I didn't donate to your fundraiser to raise awareness about blindness in snipes, I've been saving for my dream and watching my pennies. Which reminds me, I have $7 worth in pennies to cash at the bank.

What financial advice do you have for first-time home buyers?

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