Pssst, do you have an emergency fund?
Are you ready to drop $75 dollars at any moment? If disaster strikes at your home, do you have a home warranty? Because if you don’t have a home warranty, it may be more than that. Or what if your home warranty doesn’t cover it? As I’m typing – I just had to drop $75 on a dime. $75 I didn’t plan on spending, that wasn’t a part of this month’s budget. I’m on a mission to climb out of debt by 2020. However, I will say I’m glad I have the warranty as dropping $75 is better than the $150 it was going to be.
Here I am, sitting on the couch contemplating, what time should I run to my work to go to the bathroom? You see my toilet is on the fritz, won’t flush and the service guy can’t come until tomorrow.
Are you ready to be inconvenienced just to own a home? I usually have to pee in the middle of the night or as soon as I get up, which is basically the middle of the night for everyone else since I wake up at 430am. So what do I do, what would you do at 430a and you had to pee but your toilet isn’t working?
Home ownership isn’t for the weak and I definitely wasn’t ready. Buying a home was something I thought people did when they got married. In fact my parents (I think) didn’t own a home until I was in 5th grade!
Lucky for me I had parents, especially my Dad (he’s more pushy in the “what he thinks is best” category) — so because of him {them} I own a home. There are days I love it – days I loathe it. Today, I hate it, but I’m also certain that a toilet issue could happen in an apartment as well, you just may not have to pay for it!
However – WOW – I’m a home owner! Woot Woot! I’m 35. 2 months shy of my 36th birthday and I’ve owned a home for 6 years come November 2019. Boy – has it been a blessing AND a curse. A roller coaster of emotions. I love that I own my house, a space to call my own, that I can have a pit bull live with me and that I’m the only name on the mortgage. I am woman hear me roar, but…
It’s easy to underestimate the real cost of home ownership. – Suze Orman
(1) I wouldn’t suggest buying a home until you have money in savings, at least $2,000 and not for the down payment but as your emergency fund.
Only 39% of Americans have enough savings to cover a $1,000 emergency according to a 2018 article by CNBC
Did I have this? No, but now that I’ve learned a lot I’m using it to teach in hopes you won’t have to go through what I went through. I promise you, once you buy your house, something will go wrong as soon as you move in. Especially if you’re not buying a brand new house. Let’s be honest, most of us aren’t. My house was built in 1950 and as soon as I moved in (2013) I had something go wrong with my plumbing. The pipes in my backyard that led to the sewer were crushed by a tree root (how I understood it) which meant my water (including my toilet) had nowhere to go. Emergency for real. I couldn’t shower or go pee (or…) and that set me back $691.65, which I actually remember being able to pay in cash. Luckily with an issue like that it’s labeled an emergency and within 24 hours someone will come to your rescue (as long as you call).
The way to build your savings is by spending less each month. – Suze Orman
So, if you’re thinking about buying a home and you have zero savings you need to set some goals (write them down) and crush it! Maybe buying a home (for you) is a year off from now. The time is going to pass anyway, so you may as well pass the time while working towards some goals. Your life can be so different in a year.
(2) When I bought my house (2013) President Obama had a first time home buying program, which I was eligible for and that awarded me $3k for a down payment. The guy who is President now got rid of that, at least that’s what I’ve heard. I’m not in the market for buying a house so that could be wrong information. Don’t let me deter you from asking a loan officer or a bank questions. Questions never hurt anyone and actually aid you into knowing what to do next. Before my Dad convinced me to go ask questions, I thought that my credit score wouldn’t be good enough. To be super-frank (is that a thing) in 2013 I had NO idea what my credit score was. I don’t think Credit Karma (I use them now) was as big then and I didn’t even know you could check your credit, let alone check it for free. I started asking questions and that’s how I met my loan officer (Hi Katie), who I have on speed dial now! Don’t cut off your relationship with your loan officer or Realtor once you close on your home. Trust me. You’re gonna have more questions and who better to ask than the people who helped you get into your home?
(3) Now, once you own a home, have you thought about having mice in your house? What about ants? Guessssss what…. I’ve HAD BOTH! Yuck. It makes you feel completely disgusting. Just know it has nothing to do with how clean or not you are. Mice (and ants) usually come inside in the winter. It’s cold and they need food, so don’t take it personally like I did. *teehee*
To get rid of them: It’s a pretty penny….runs about $400-$500. However if you have a good service (pest control), they shouldn’t come back. BUT, you’ll want to do pest control a couple times a year. After the “get rid” of them phase – the” keep them away” phase is cheaper. About $100-$150 each time. I only have my pest guys come out about 3x a year! In 6 years, I’ve only had mice once and ants twice (they love my dog’s food).
Can you see already how much a house can run you????????????
(4) Now I don’t know if it’s because I’m a girl – on my own – or owning a house for the first time BUT there is a learning curve. It just seems like men just “know” what to do, as for me, nah bruh, everything I’ve learned I learned because something broke. So again, I can’t say it enough, have SAVINGS before you buy a house, once you buy, GET a home warranty. Even if you already own a home, it’s actually not too late for you to get a home warranty. Each service request (something you need fixed) runs me $75 but it’s WORTH every penny. My pipes underneath my house were so old and weren’t up to code anymore. So I needed all new plumbing about 2 years ago. It would have run me around $3k but again that home warranty covered it for $75. WINNING!!!
My microwave went out. Got it fixed for $75. WINNING!! Every agreement is different so make sure you know what you’re getting before you sign. I didn’t – again I learned everything I know because it broke – I just went off a suggestion from my loan officer to get a home warranty. Thank God I listened… (Hi Katie)!
My water heater was covered for $75 after it leaked all over my house. Which awarded me a home remodel thanks to my home insurance (which is required in home ownership), new flooring and a new kitchen. You can read that story here! If I didn’t have my home warranty, my water heater would have run me about $1000 which at that time I DID NOT have.
Side note: I’m so silly, it took me a whole day to figure out what to do once I found out my water heater busted. Someone said “don’t you have home insurance”? I was crying over probably having to shell out $10k – money I didn’t have! What a horrible 24 hours, Yikes!
However, THANK GOD, my home insurance came through and I just had to pay my deductible – $1k! So remember, home insurance and home warranty are two different things. Home warranty is like car insurance on your house, so that’s something YOU have to set up!
Being here for 6 years taught me that an emergency fund is NEEDED. Even if it’s just $1k – Dave Ramsey suggests to always have at least $1k until all your debt (minus your house) is paid off. Living financially smart will give you financial freedom: shout out to Dave Ramsey and Suze Orman for teaching me a lot about money. My plan is *chanting* debt free by 2020 – but I highly suggest you get on that plan (debt free) BEFORE you buy a house!
Few Quick tips:
(5) You’re responsible For shoveling your driveway and sidewalk in front of your house. We just had a huge SNOW STORM that lasted 2 months and where I live this is NOT normal. I had to shovel at least 3 times, good news by the 3rd time, there were less tears. I heard the mail man wouldn’t even deliver to the houses that didn’t shovel. I didn’t want to be that person!
I feel like this is the BEST tip I can give you girl: have a list of handy guys saved in your phone. As far as the toilet story from earlier: I ended up not having to run to my job in the middle of the night to pee because I know my plumber. We’re “friends” on Facebook (Hi…Frank) and after I called my home warranty service, I messaged him to let him know that he’d be getting a call for service. Thank God I hit him up because he taught me something new in that moment. I was complaining about the ‘middle of the night’…
Him: Is it clogged?
Me: no
Him: Turn off the valve underneath the toilet and dump a bucket of water in the toilet to flush it
Me: it won’t overflow?
Him: Nope
Me: I can do that more than once?
Him: it’ll work every time
LIFE SAVER! Imagine having to run somewhere in the middle of the night, in the dead of winter just to pee 🙁
(6) You can use your home as a “bank” I wouldn’t do it often but I needed a new roof (2018), so when the rates for home loans were lower than my original home loan, I refinanced. Refinancing is cool because you have the option (make sure you don’t do this too much and ASK QUESTIONS) — to finance for a little higher than what your old loan is worth. Then you use that extra cash to pay for your roof (or whatever you need fixed). Example: home loan was $100k – refinance for about $115k and use the extra $15 to pay for the roof!
My Contractor (guy who did my roof – Hi.. Jan) is so cool and I obviously still have his number. When my “ice damn” (learned what that was this year) happened I sent him this text:
He said: Is it leaking in the house?
Me: No
Him: It can be bad but I know the roofers. Knock the icicles off to reduce the weight on the gutters and you will be good.
Winter is about over now and the ice is melting, so far so good!
I did start freaking out about my ‘Ice damn’ with all the FB comments. Which prompted me to text him (Hi… Jan). He would know more about the roof than I and certainly anyone on FB voicing their unsolicited opinions, which only gave me anxiety. Having his number and keeping it was a big help. My roof was brand new but I would highly suggest you get an opinion on your roof before you buy the house, during winter and if you own a house now and have no idea how old your roof is… call a roofer … NOW!
Lastly,
(7) Buy a truck (with a bed) or have really good friends that have one. Honestly if you can buy a beat up truck, buy one, I will be soon (but only if it fits into my ‘get out of debt’ by 2020 plan). You’re gonna have things you want to buy that may not fit into the car you own now (my problem) and/or you will eventually need to take things to the dump. For me, since it snows where I live, maybe a new normal (global warming), the plan is to buy a beat-up 4-wheel drive. My Honda doesn’t cut it in “feet” of snow. Eeek
(8) I’ll hit it one more time: save, save, save, save!! Having savings before you buy your house and once you do, stay on top of that emergency fund, it is the SMARTEST thing you will do for YOU. When you move into your new home, you’re gonna want to decorate and buy furniture and turn it into a home you can love! That will cost money. Not to mention the upkeep of your yard. Which I haven’t been able to touch yet and my back yard is HUGE. However, who’s gonna cut your grass? You? I didn’t want to, so in the past I’ve hired a company (expensive) but as of Summer 2018 I bought a lawn mower and my cousin has been helping me. Hopefully you’ll live in a neighborhood that has teen kids who will do it for you for like $20 bucks!
You have got to be the masters of your own financial future. – Suze Orman
If I sold my house I’d be out of debt, because my house is worth way more today than what I bought it for. Remember when I said it’s like a bank and with the remodel and just cost rising, selling my house would give me a lot of money back. But where would I live? After owning a house, I don’t know if I could go back to an apartment? At least not in the city I live in now! Is it worth it? YES… but it’s going to cost you.
Ps. Owning a home isn’t for everyone and you are NOT “less than” if you don’t own a home. That is from the mouth of Suze Orman xo