May 5, 2012

Our House: The Backstory

If this is going to be a place where I keep track of house updates, I figured I might as well go all the way back and tell the whole story.  It's not really a story I'd like to shout from the rooftops, but it's honest and I think it's reflective of what a significant chunk of the U.S. population has been struggling with.  So in the spirit of full disclosure, here goes.

Steve and I got married in 2003.  He was stationed at Ft. Lewis, so we lived in a series of apartments for the first three years of our marriage.  Let's call them "The Tiny One," "The One Where The Neighbors Kept The Local Police Busy," "The One Where We Ate Ramen Because We Spent Every Last Penny On Rent," and "The One Where Even Bombing And Traps Couldn't Get Rid Of All The Spiders."  Lovely, yes?

In the summer of 2006, a year after Steve was discharged from the Army, we decided to move back up towards our hometown. We were tight on money, and rentals in a small town are limited, so we moved in with my husband's parents with the thought that we'd stay for a few months while we were looking for a place of our own.  So as we started researching rentals, we came across more and more advice urging people to forgo renting and purchase a home now, before property values were so expensive that we'd have no hope of ever having our own house.  To our surprise, a mortgage broker from our church told us we'd qualify for a mortgage.  Then Steve's parents offered to help us pay the mortgage if they could live with us as renters.  We found a 1200 square foot house we loved, got approved for an ARM with zero down, and in August 2006 we moved in.

The previous owner had two toddlers and a large german shepherd, and the house- especially the yard- showed it.  We didn't have much money to put into improvements with a $1900 mortgage but  eventually we managed to fix up the outside a little bit- some landscaping and a paint job did wonders.

Our first house, 2009.

As we all know by know, the mortgage bubble burst in the summer of 2006, at virtually the same time we moved in.  We diligently made our payments but in 2008, my in-laws moved out and our budget tightened.  We began investigating our options for refinancing or mortgage relief help as our house value continued to plummet, Steve's work shifts became harder to come by, and our 5 year ARM activation date neared.  We tried everything we could think of to save our house and our credit for two and a half years.  Every option we investigated turned out to be a dead end or a scam.  On the advice of our lawyer, we stopped making payments in 2010, and were foreclosed on 15 months later.  As of our foreclosure date, our little house was worth $100,000 less than we had paid for it, having lost over a third of its value.

A few months before our foreclosure finalized, we began looking for rentals.  My mom came with me to look at a little house for rent in Everett.  The house itself was pretty decrepit, but the rent was in the range we were looking for, and it was the nicest rental I'd seen in that price range.  I think it's not too far off the truth to say my mom was horrified.  A week later my parents said they were thinking about purchasing a house and renting it out... to us.  A few trips to our respective lawyers later, we agreed to go for it.

My parents were even more generous in letting us pick the house, given a certain price range.  We began looking in our hometown and a couple of nearby towns along the I-5 corridor.  Most of what we found in our price range were major fixers (with names like "The Pee-Pee Houses: Versions 1, 2, 3, and 4" and "The Unintentional Tri-Level House" and "The Chainsaw House" and "The Tarp For A Roof House") or featured something that earned it an automatic veto (I'm sorry, but if you have to sit on the bathroom sink so you can close the door to gain access to the toilet, it's an automatic "NO" from this girl!).  What was decent was usually quite small, and sold lightning-fast for much more than the asking price.

After a few months of disappointment, we decided to expand the area of our search to include a tiny town that I often made fun of as a teenager for being full of bumpkins and loggers, and had more recently earned the title of third highest meth use per capita in the United States.  On the first day we looked, we found a house that was a minor fixer and was listed for a very reasonable price.

The picture of our current house that was on the real estate listing.

Steve and I liked the house and the property, but neither of us were fond of the location- folks in the drive-thru of the town's McChevron can look directly into the master bedroom and the backyard, the people who live in the run-down apartment building across the street look like they helped earn that highest meth use per capita title.

McChevron's drive thru.  You can hear people placing orders when the windows are open.

The apartments across the street: where plywood and tin foil are considered window treatments.

We decided that the house would be the best possible scenario we could get for the asking price, and my parents put in an offer and got it. 

We've lived here for almost 9 months now.  We know we'll never love the location, so we decided to do our best to make the house and property feel homey, feel like ours, so that we're not sad to have lost our first house, to be living here.  Essentially we wanted to take what started as a bad situation and make the best of it.

I think our plan is starting to work- we like being in this house.  We've made lots of improvements already- made possible by very reasonable rent and lots of elbow grease- and we have  LONG way to go before all of our plans come to fruition.  I'm sure there will be many upcoming posts here about those improvements, too.

So there's the whole terrible and wonderful story.  Anyone else have a story about how the housing bubble bursting changed their lives?


  1. Colleen...we have gotten bit in the butt by the economy with the house, also. When I bought it in Feb. 2007, it was nearly a miracle, but now it's become somewhat of a curse. I bought it with another girl, and we had no down payment. Thank GOD we didn't do an ARM, we knew better by then. BUT, now Jeff and I owe MUCH MUCH more than the house is worth. We are thankful and blessed to have a home AND to be able to afford it, but are sometimes tempted to walk away from it, repair our credit, and start over! Our house is beautiful and large and comfortable...but crazy enough, we would like less house, more yard, and less owed! I feel your pain, girl! Way to go coming shame in that. I heard recently that over 50% of home purchases in Snohomish county are in distress. are we going to get out of this mess?!

  2. Good for you guys, sticking it out. I know a lot of people who are doing refis right now and saving major bank. If only we knew then what we knew now, huh?