Making the Commitment to Owning A Home ... In A Time of Uncertainty

I took the plunge of home ownership almost four years ago and I didn't know I had an uncommon desire until I got to the closing. While my peers were shopping for the latest fashion, I was saving and scoping real estate magazines in my mid 20s. Though anyone who knows me know I embrace fashion but I had to sacrifice buying any shoe and unnecessary clothes for over a year.

When I arrived at the closing, the attorney asked the mortgage agents if we were really closing that day. I found out later that his apprehension was based on first, I looked younger than my real age (even though I chose to wear a suit that day), second, he thought I was a man based on my name (which to me was an advantage because I negotiated some things that the seller readily agreed to) and third, I was single while he was used to seeing couples buying a home together.

My closing day was one of the scariest days of my life. The attorney noticed my hand was shaking as I signed the documents when he asked "first home?" "Yes," I replied with an unusual tremor to my voice. He smiled, and said "it gets better." All I was thinking was I sure hope so because it was two days before Christmas and I'm wiping out my accounts for the closing costs.

Sometimes I look back and wonder how I did it; I was about six months into grad school, working more than a regular full time job, looking at homes during the weekends and dealing with the stress of real estate agents and other emergencies.

But I don't regret one minute of my decision. I was very conservative on the amount of house to get to the chagrin of my realtor. I gave her a specific range of price I was looking for, which she and the mortgage reps she worked with laughed at. When the look on my face told them I was not joking, they really got to work even if it meant moving to another county.

Since I got my home, I've experienced four hurricanes in the span of two years with the last one, Wilma in late 2005 packing the cruelest punch. Some of my windows were shattered, blinds shredded and water sipped into my home but the most important thing was I made it out okay. The stuff could be (and they were) replaced. Also, due to the hurricanes, the cost of utilities and insurance took a significant hike. Many South Florida residents and home owners complained to their government but it made little to no difference. What most had to do was either move or adjust their lifestyles. I chose the latter and you know what? You'll be surprised the amount of things you first thought were necessities that you could really do without.

Sent by Moji | 10:16 AM | 9-20-2007

I first bought a home in 1993 after I split up with my first partner. The condo market was glutted in the midwest so I was able to get a great deal on a 2BR 1BA home at that time. I never regretted it. It was perfect for me as a single woman. I had no maintenance, really and could do some gardening if I wanted to. My parents helped me make some improvements over the 5 years I lived there which really paid off when I sold it.

Thankfully, I've never been at risk for losing my home. I bought within my means (thanks to the smart advice of my parents) at the time and that's still the case with the home I own with my current partner. We are now purchasing a larger home for ourselves and our almost two-year old. We have been fortunate enough to be able to afford a fixed-rate mortgage and have stayed in this home for almost 8 years although we would have liked to have more space earlier, of course.

And for remaining comitted to this home, well that's just part of who we are, I guess. We've been house-project people from the beginning and we have family members with those kinds of talents which is very helpful. We are both pretty handy so we so we do much of the painting and other work ourselves. My father's a great carpenter and so is my partner's and my brother can do wonders with lighting, etc. Now with a daughter, we are even more comitted to making our home into something that's good for her needs. We have also been concious of making improvements that are smart for resale. I remember when we painted the kitchen cabinets. My brother humorously told us we had two color choices: white and white. We took his advice. Now that our home is on the market, we hope to see our labors pay off.

Good luck to you Farai, as you take the plunge. It's scary, but worth it if it's what you want.

I listen to your show on Wednesdays as it's my "late" night at work. I truly enjoy the time (child-free) to listen uninterrupted!

Sent by Jane Miles | 3:45 PM | 9-20-2007

I am 49 years old and I have owned a number of homes. I bought my first home with my-then husband, when I was 24 yrs., and we moved up three times on a fixed loan. I went though a costly divorce, took my portion from the sale of the home, and rented a home. Friends and family told me I was crazy for not buying another home, but I did what I thought was best. I was newly divorced, with bad credit, and children to put through college. I would have needed a sub-prime loan to have qualified for a loan, even though I made good money. If I would have listened to others, even though their intentions were good, I'd be in financial trouble right now, and know for a fact that I wouldn't be able to continue to pay my mortgage. Owning a home id great, and I plan to own another home, but it will be a home I can afford at the right time.

Sent by Lisa | 4:18 PM | 9-21-2007

I am 39. I bought my first home a little more than a year ago. I decided to by a home in the predominately Black neighborhood in West Oakland. I had good credit, a small down payment and make good money. I was very vocal to my broker about what I expected from a home loan. I didn't want a sub prime loan. If at anytime my broker had told me that that is what I was getting I would have backed out. I was insured that was proceeding according to my instructions and I qualified for the loan I was asking for. I was told my payment would be high because I had a small down payment.

I purchased the home. I found out later that information was changed on my loan after I signed it. That it was sub prime with a huge prepayment penalty with only 5% of the $4000 we are paying going to the principle. It would adjust in two years. Everything I was led to believe was a lie.

I've heard that brokers had been given special incentives to push this type of loan, especially in areas like West Oakland. That and the low scruples of the broker are the only reasons I can think of for being railroaded.

Now I find myself fighting to try to find away of refinancing before the loan adjusts in April 2008. The brokers that have looked at my situation say they can't believe it; they don't understand why I got stuck with this loan package. They also have said that it's next to impossible to get me out of it at this time even though I've made my payments on time, make more money, maintained my credit and have married making my husbands credit (which is nearly perfect) and income available. All because of the prepayment penalty and the fact that home is considered a jumbo loan and the laws have changed making it harder to refinance.

It's more than a little depressing to hear the media that lament that people like me are greedy opportunist or stupid and therefore deserving of this mess... help will be given in the future to people buying their first home... people who were greedy and were attracted to these loans will not be bailed out. Notice that even though it has been acknowledged that there are people caught in this mess due to fraud, there isn???t anyone offering any guidance for them. Also notice that there are no repercussions for the brokers like the one I dealt with. I remember overhearing my broker talk about remodeling her kitchen with the commission she would get from my sale.

I don't want to be bailed out. I just want to have some advice on how to navigate this mess so I don't fall prey to more deception. I intend to keep the house. After paying of nearly $70,000 mostly in interest in the last year and a half as well as all the pain and work in buying a fixer upper. All I wanted was a place to start a family and support my community. It would be more than a tragedy to lose it all.

Sent by Sheila | 2:07 PM | 9-22-2007