
Bye Bye House!
So, I found a really beautiful house online one afternoon while preparing for our move from Vermont to Green Bay. It had everything I wanted in a house - beautiful new appliances, four bedrooms, a sunroom, a large backyard - you name it. I had never had a truly beautiful bathroom before - and this one, though small, fit the bill. After years of living in fixer-uppers and that time in the car…well, I thought I had really found my first “real” house.
Because we were moving so far and into a neighborhood I had never lived in before (we had lived in Green Bay before), we decided to take the rent with the option to buy rather than just buy it, sight unseen. Even though we had sent several friends through the house to check it out, I still didn’t want to commit a huge sum of money to a house I had never seen!
So we sent away a down payment, the deposit, the rent, and signed all kinds of papers for the option. We loaded up our trucks and headed down the road. The house was everything we hoped it would be. While it did have a few quirks, it was exactly what I wanted - and much bigger than I had thought. I was very happy with my choice…and knew that I would end up buying it. I made all sorts of plans, talked with mortgage brokers, got the kids established in school and went about being pregnant and living my life.
That’s when we started getting weird phone calls. We started receiving phone calls about past debt and debt collections to the owner of the house. Then the owner of the house started to call my husband at work and demanded payments for arbitrary things that weren’t in the lease. Also, she started making up strange dates to have things paid by. We were skeptical and suspicious. She was acting like a person who needed money fast. While I wish I could say that I did a background check on her before we rented, I did not. I never thought I needed to do a background check on a landlord…but I did - and the results were revealing. A bankruptcy was in the works for her - and her mortgage on the house was through a sub-prime lender and it was interest-only. In fact, her asking price for the house was $50,000 more than the assessment on the house - and all of a sudden she was unwilling to negotiate lower - even though our contract said we could pay fair market value for the house.
In our neighborhood, fair market value, was quite a bit less than her asking price - and there were many homes for sale and rent in the area.
I just kept paying the rent - and hoping that things would sort themselves out. Then we got “the letter” telling us we had two weeks to vacate the premises. Why? Not because we had done anything wrong - but because our landlord was now in foreclosure.
What a slap in the face! I had heard stories of this happening to people, but I thought they were flukes. Really, there is very little a renter can do, unless a state legislature has mandated that banks assume the leases of people who are renting foreclosures. At the mercy of the powers that be, and unable to get back any of our security deposit or down payment, we scraped together another deposit and first month’s rent on a different house.
I cried for quite a while. I thought I had found the house I was going to live in for the rest of my life - or at least a lot of it - and I almost ended up with six kids out on the sidewalk again. I actually tried to picture how the logistics of living in my truck would go!
Fortunately, we did find a new place…in the neighboring college town, on the river, and in a school district that’s 100 percent better than the one we were in. Unfortunately, the house is UGLY and I have a lot of work to do! But, that’s OK, I was getting spoiled by all that luxury living - and there isn’t nearly as much pressure to keep a fixer-upper spotless with almost seven kids (oh yeah, and my teenage son’s best friend) as there was to keep the old “perfect” house clean. Just sweeping and mopping around here makes me look like Martha Stewart. It’s big though - with lots of bedrooms and a nice sunny deck. I am still very fortunate. I have beautiful, healthy children and a great husband who still has a job. Our ugly foreclosure story did not turn out as ugly as some.
I may not have the richest house on the block anymore - but I’m still the richest girl in town!
A couple of quick renting tips:
1. If it seems too good to be true, it probably is. Rent with option is fine - but don’t send any more money for “deposit” than what’s required (first month’s rent and security). You are not yet buying the house - you only have the first right of refusal when it goes up for sale.
2. Don’t give the landlord any more money each month than you’ve agreed to pay. Save the extra towards a down payment if you want to eventually buy the house.
3. Do a background check. Your potential landlord is going to do one on you, after all. Go to intellius.com and find out about who you are renting the house from. Also, go to your local county government website and make sure the taxes are up to date - and find out for sure whose name is on the deed!