Dreaming
Posted on August 4, 2012 12:31 pm under General
| 2 Comments
This was one of those mornings, when I just couldn’t seem to wake up, although Mother Nature tried to help. For the last two days, we have received some much needed rain and it has been accompanied by lots of thunder. I’d forgotten how loud thunder can sound, when it reverberates off surrounding mountains. In lower lying areas, that level of noise would indicate a lightning strike close by and the continuous roll of thunder might indicate an approaching tornado. Here, it is just an echo and I complacently drifted back to sleep. If the house were struck down some day, we’d probably be kicking ourselves for ignoring the warning signs. We wouldn’t be alone. People do that all the time.
For a year before we purchased our first home, we lived on my husband’s paycheck and banked mine. A substantial down payment yielded a lower interest rate and provided us with the security of immediate home equity. When my husband lost his job shortly afterwards, we were able to make ends meet. We were used to living on one paycheck. Our situation wasn’t unusual. People accepted the need to save for a home. Foreclosures? Not anyone that I knew.
When I purchased a second home, almost thirty years later, things had changed. Television, radio and billboards urged families to “have your dream now”. Signs, proclaiming “Move In For $500”, sprouted in front of new homes. One’s maximum mortgage qualification was considered the price of the home that one should buy. As quickly as home values rose, owners were urged to refinance. Every day, the mail brought offers showing how much my home could be refinanced for. I never did it, but I had plenty of neighbors and co-workers who did. Some refinanced multiple times, keeping their home at zero or negative equity. It’s not amazing that so many homes foreclosed, when times got tough. You didn’t need a substantial mortgage education to predict what would happen.
Some foreclosures were undoubtedly unpreventable. For many more, the warning signs were flashing as home owners indulged in a no-work dream.
2 Responses to “Dreaming”
August 5th, 2012 at 2:10 pm
Hi GMa ~~
~~ Is this a picture of your new home? It sure is a pretty one in a very pretty setting. If it isn’t yours I am suposing that the owners consider it next to being home in Heaven!!! I would.
You showed partly why our economy is so fragile. Many, many people don’t have an investment in it at all. Just spent dollars to lament over.
Our first home, a new three bedroom in New Hampshire cost $14,500, 1961. No down payment required. It didn’t have a garage and only one bath. But it did have a basement that we haven’t had since.
The second home (new) three years later cost $16,000, 1965. The 20% down payment was one half loaned by the MIL and the other half of the down payment was loaned by the builder. He later cancelled the loan for half of what we owed.
The third home (new) cost 48,500, 1976. We had the down payment saved. It flooded once in 1969 when the Houston area got 26 inches of rain in one sitting.
The fourth we are living in now (new) cost $198,000, 1999. The lot cost $36,000. This is our ‘retirement home’ until we need assistance or to be close to one of the kids.
Most of the
August 5th, 2012 at 2:15 pm
price incdreases were due to inflation and a lessor part of the increase was because the newer home each time was a little larger than the previous. Plus more baths, bedrooms, and garages.
When Mrs. Jim and I got married in 1973 we had less than $500 total savings between us. She had a student loan and I had child support for four children. Both of us were able to work although they were ‘school’ jobs.
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