Monday, July 20, 2009

Even the Democrats think I'm Lame

Some couples in the ward, who are also graduate student families, are in the process of buying houses. Inspired by them, Avram and I jumped on the bandwagon, and started getting really excited at the thought of having a house (for me especially, having a fenced in backyard for the girls to play in would be a real plus to life). There were houses here in the Midwest we could afford monthly payments on. Plus until the end of the year there is a home buyer's tax credit that would be 10% of the house's cost (up to $8,000), and it is refundable. This means, since we don't pay any taxes anyway, that we could get a $7,000 check in the mail from Obama (since $70,000 was about the prices of the homes that we were interested in).

So, after thinking about this all weekend, today I put on the electronic babysitter for Lydia, and went and read up a ton on houses, house mortgages, blah da de blah blah. And it was complicated, but things were going well. We would want to get an FHA loan, being the graduate school low income people we are, and because they only require a 3.5% down payment. For $70,000 that is not very much. Just $2450. Unfortunately for us, that is about $2000 more than we have lying around in our bank accounts. See, I have this little obsession with paying of debt. And I stand by this hobby - I think it's a good one. But it means that we don't save up money, except for a small emergency fund for car explosions and insurance deductibles for people explosions and whatnot. We figure if anything really large came up - large explosions for people or cars, we could just easily get a student loan to cover the costs of reconstructive surgery, or whatnot. Not that we or our car are liable to explode, you understand.

What about that lovely (hypothetical) $7,000 you would get from buying a (hypothetical) house; could that be redeemed early? Why yes, yes it could! Hallelujah! For closing costs, and for a down payment, above and beyond the 3.5% you are required to pay separately, that is. The 3.5% we don't have. And you can't use a student loan for a down payment (for fairly obvious reasons, but it also seems to be considered illegal). And you can't borrow money for a down payment - not even unofficially, from family. You can use a gift of money from family for a down payment. But they have to officially sign a statement saying it is a gift, and requires no repayment. So you can't (wink, wink) get a "gift" from family. It really has to be a gift. Even if you could repay it in a matter of a few months, out of the Tax Credit.

I understand why they have these safeguards. I understand people who have no savings, and who only work part time, and especially who have switched jobs in the last two years (which disqualified us from our beloved Credit Union, because we don't live up to their standards of people to lend to. This endears me a lot to them as an institution - I'm glad they have standards. I just wish I wasn't lower than them) are not considered good credit risks. I just wish they had a special type loan for people who are hardworking, educated, and will pay off their loans and not move them and their whole extended family into the house, only to stop paying mortgage on it months after the papers are signed. The upwardly mobile, but it's-taking-us-a-long-time-because-a-doctorate-is-hard-to-get-sort-of-people. In a word, I wish they could look at me, and say, "Thora, she deserves this loan. Just look at how level headed she is." Instead, they can only look at my financial profile, and despite my good credit score, I'm pretty lame everywhere else. Avram only works part time. I don't technically work at all, although I do babysit part time. We have no substantial savings. We make hardly any money a year.

But, if were were magically "poof!" in a house, we would have no problem making the payments, including the insurances and extra utilities. And we're very nice people. But banks do not care if you are nice people. At least not now. Two years ago, Lydia probably could have gotten into a home with no money down. After talking to two institutions (the first one, USAA, doesn't even do FHA loans anymore.), our short lived house dream bubble is burst.

Too bad we walked past two of the homes yesterday we would be interested in. And now I can imagine them in my mind (they are both foreclosed on), all abandoned, and just wanting some Thora-love. But I am too poor, even for the Democrats. Unless any of my family out there want to suddenly bequest me thousands of dollars just because you love me, or because of my high quality blog-writing. Whaddya say?


  1. How disappointing! It's really crummy to think you'd have had a better chance if you hadn't been so responsible and had saved money instead of doing the crazy actually-paying-your-debts this.

    This world is nuts.

  2. I can spot you a few thousand because of your high quality blog-writing.

    Oh wait. No I can't. Sorry about that. I need someone to spot ME a few thou'. (read that with a soft "th", ifyouwill.)

  3. There's this cute old barn house that I drool over once in a while....


    The joys of schooling, no?

    Good luck with it all.

  4. Some day you will no longer be students. Then you will have income. It will feel good. Honest.

  5. I'm sorry, Thora! The way they look at loans really is lame. Maybe things can still work out. Maybe just wait until next year's tax refund and then you will magically have that earned income and child tax credit. Who knows. Maybe they will even offer some other incentive next year and there will be a different new home buyers credit. It's not over 'til it's over!

  6. you know last year the government gave out a 8000 loan that had to be repaid... this year they gave out 8000 for people to keep free and clear. So hopefully next year it will be 16000, right?? in all seriousness i am hoping they do the 8000 again next year becuase then it will be three years since cory and I bought our house in utah and that means we can qualify for it and YAY who doesnt love "free" money that i will more than pay back with taxes the rest of my life

  7. We were married ten years and had rented ten different places before we finally bought a house. At least once or twice in that ten years we lusted after a house. But I can say now that it was worth the wait, as I can't imagine living in a better home/neighborhood/ward/climate/school system/etc than what we're in now.

    It'll come in time.