The Delta House

September 27, 2000 - Closing Time

Not all unexpected changes are positive, and this is one of the negative ones. It started out optimistically, closing on the purchase of our first home on our third anniversary, but don't be deceived. This was the single worst financial decision that I ever made.

We had been working on a project in Rhode Island since August of 1999, and had been renting a place since then. We were making outstanding money, clearing nearly three times what I presently make. So we decided that a house would be a good investment, and started looking in Rhode Island for one that was suitable. We put in bids on several houses, and each time, we were outbid, even when we offered at or slightly above the asking price.

Then we tried to purchase my mother's townhouse in NJ where she had been renting for over twenty years. It would have been a great investment, and could have been a vacation home for us in the future. Also, it would have been helping my mother financially. We figured that we would put up the down payment and pay the monthly payments, and she could pay the co-op fees which were significantly less than her monthly rent. She wouldn't go for it.

Option three was to buy a house near her family in the Carolinas. She flew down to Myrtle Beach for the weekend and looked at homes with her father, finding one in Ocean Isle Beach, NC that she thought was just perfect. It was a model home for a new development, a gated community with lots of rules for the homeowners. With my line of work, I knew that I might be on the road a lot of the time, and the security of a gated community appealed to me.

We decided to buy it.

The closing was done via FedEx because we were way too busy with work to fly down and do it in person. I knew almost instantly that I was making a mistake, though I passed it off as "post-purchase anxiety".

We never even stepped foot in that house until Thanksgiving weekend, and then we were only there for a few days. During that time, we spent almost $15k furnishing the place. We had all of our utilities turned on, and the bills forwarded to our place in Connecticut. I forgot to mention that by then, we were out of the rental house and living in a 35' fifth-wheel trailer in a campground in Connecticut.

My wife was laid off from her job in February, and in March, she went down to spend some time at the house. By this time, we had already made 5 mortgage payments of $1,600 each, paid 7 months of homeowner's fees totaling $350, had landscaping work done totaling over $2,000, and paid utility bills totaling over $1,700. All that money for a house that we weren't even living in!
Keep in mind that I didn't mention the rent and utilities that I was paying for the place in CT. In short, we were in some serious financial trouble, and then we had only one income.

After a few weeks of being alone in the house, my wife came back to CT to be with me. We decided that we should probably cut our losses and sell the house, then look for one where we were actually living. We put the house on the market May 2001, and there was very little interest. Our realtor had a negative attitude about the place because it was originally a model home, but we had done significant landscaping and interior work. We even rented furniture for a room that we hadn't previously furnished, another expense that we really didn't need.

Summer passed with no interest, but the fall tourist season was coming, so we were all optimistic. Then came September 11, 2001, and nobody was thinking about buying houses. We finally did close on the sale of the place in March 2002, but by then, we were nearly broke. Our sale price was $12,000 more than we paid for the place, but after broker fees, we received a check for $550.

In all, we owned that house for 18 months, yet I spent less than two weeks living there. When you combine payments, taxes, maintenance and utilities, we spent nearly $40,000 there in all. Needless to say, this affected not only our finances, but our relationship with each other as well. I resented her for buying that place, though I realize now that I was as much to blame. I was consumed by my work and was emotionally unavailable for my wife. We were living in a strange area with no family or friends outside of work, and she needed something that was secure. I had a "just throw money at it" attitude, and it bit me right in the ass.

Our relationship is better now than it has ever been, and we are finally getting our finances back on track. We have a great house that we actually live in now too. Needless to say, we take a little more time discussing all of our major purchases now too.

Well, you live and hopefully, you learn.