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The entire nation has been riding the Trillion Dollar Real Estate Recovery Rollercoaste for the last several years and the above link can tell you much more about the numbers behind it. I will also be writing more soon about what that looks like on a local basis.....and first I am going to share what is has been like on a very personal level to ride this coaster while also riding the personal roller coaster caused in part by the national and perhaps international rollercoaster.
This is a story about a family, my family on this coaster.
This is also a story about faith. Something that helped us very much the last few years.
I am not sure where to start with this story, because like all real stories it does not have a neat beginning and ending. I think the best place to start is as the coaster was rising like crazy, since that is where it began to be a coaster.
At that point in time I had 3 children, one of which was very young and I was working from an office in my home along with a full time assistant. I was as busy as I wanted to be, in fact sometimes more so and was doing a good many short sales. I had my very best year in 2007 despite the fact I had a small child I kept with me while I worked and had little time to actually meet new people.
I owned one rental home all on my own and one with my husband and we had the home we lived in. I decided to purchase another one at that point this time with far less down than before with the intent of doing a lease to own for a friend who could not yet qualify for a loan. Of course she would buy me out in 2 years and values would be much higher by then so getting her own loan after repairing her credit would be easy. ( remember this was 2008) I purchased the home. This was the end of July....what I now have identified as the very very top of the peak of the market in our local area. She moved in. At first it was all fine.
My business continued and was very busy at the end of 2008, I had well over 3.5 million dollars in escrow at that point and my husband had just received a small raise. We had planned to have our 4th child ( and since we did not even have the first until we had been married for 11 years and he was now 11 we were also running out of time to do so) So...we took the plunge and conceived right away.
We were excited and happy.....and then the bottom dropped out of our lives.
It all happened so fast I am not sure today the exact order of it all. We just kept falling and just when we were sure it was bottom, well it was not.
My assistant of 3 years began working from her home over the summer of 2008....at least I thought that was what happened. The bottom had not dropped out yet and I was not pregnant yet. Only really she stopped doing much of what I paid her for and reported to me as if it was done. I kept paying her of course......She had been the most dependable and loyal person I had worked with in the past and so I did not question her reports.....I should have, just did not know so until later.
I was busy and generating business and mean while she was not following up with the details since she had from what we have pieced together stopped working. I still don't know what happened, whether it was depression or something else....what I do know is by the time I realized she was not actually doing what she said she was it was late fall and I was newly pregnant. I lost 4 very high end listings and 2 that were not high end and would have been fast sales due to the fact that things that should have been done were not done. At about this point I found myself with out the business I had generated there as well as with out an assistant. ( I actually had been for a while, just did not know it) At this point I scrambled to reconstruct files she simply disappeared with as well as all the information and marketing pieces that had been on a hard drive that also disappeared. I decided I had learned a really valuable lesson, at a very high cost at this point and took measures so it would not happen again. Little did I know this was the beginning of many expensive and valuable lessons.
Meanwhile I have been making the entire mortgage payment some months and other partial payments since the friend that I purchased the lease to own home for is running into trouble. She can't pay so I do. I don't want her or her kids on the street. Then one day I come by to drop off something and she is gone....thankfully the house is clean inside. Unfortunately the yard is full of about 4 tons ( yes really 4 tons) of garbage. A market analysis reveals there is no way to sell for what I paid even though I purchased under market when I did.....and even though we put 10% down and even though we put another $5K into the house. The rental market also will not cover the mortgage payment....a lesson that no matter who you want to help and even on your own home, do not buy what will not rent for at least your mortgage payment plus taxes and insurance.
Next we got word that my husband's job of over decade was doing partial layoffs....for everyone in the company. No no one was being "let go" instead everyone was getting a 10% reduction in hours along with a 40% reduction in pay. What benefits we had also all but disappeared. Mind you with the drop in the market and resultant reduction on my pay we were already not really making it before the layoff. Along with working full time ( he had been working more than full time) he began to look every day for work.
I also began to experience preterm labor about the same time. Not only was I working with out an assitant for the first time in over 3 years....I really could not work much at all. I blogged from bed. I made phone calls, going much of anywhere and in the field prospecting and home showing became a no no. Of the more than 3.5 million in closings I had in escrow, only about $175K closed. The others ( many short sales) failed for a large variety of reasons including buyers walking because they did not want to wait for short sale approval as well as properties being foreclosed even though we had offers to buy on them.
By January of 2009 we were sure, we had no choice, we had to do a bankruptsy. This seemed like a possible light at the end of the tunnel, until after doing the required budget worksheet it was clear, even with our debt wiped out we were over $2400 short each and every month. The budget councelor said to me "The only thing I can see to cut is your grocery budget, do you think you could spend less there?" Even so I knew we would never make it with our debt so I worked hard on all the paperwork. ( not a fun task when you own property and one of you is self employed) We sent our newer truck back. Could not make the payments. We drove a 2003 Kia rio strip model that had about 165K miles on it for our daily driver for the family and my husband drove a 2 seater car to and from work. We were happy they were paid for. We did not care that you could not open the drivers door from the outside.
Our court date was set for July 13th, 2009. I continued to have preterm labor as we planned for a do it yourself at home delivery. (partly personal choice, we had done it before, and partly like before because we had no insurance we could afford)
Friends helped take care of our younger kids as we bundled little Peter for his first outing.....Federal Bankruptsy court. We cut the cord on the placenta that we had left attached until then as we walked out the door. The judge was taken a bit back when she asked if we had had any changes since filing and my answer was "yes, our 4th child was born yesterday" So a snap shot of that day determined that we were eligible to do a bankruptsy......
We barely got our breath the next day when Fed Ex delived a notice to our door. My husband had been hired for a position he had interviewed for in the month before. Not only was the pay almost double what he had been making BEFORE the partial layoff, he also was being offered full and really great benefits as well as lots of room for advancement. We thanked GOD. No one else could have arranged the timing for us so well.
The end of the story is another blog......the short of it is......we were able to repair our credit. We purchased our dream home April of 2012 and we are living there now. My business continues to make recovery along with the rest of the Real Estate market.....
The story of what we went though making our move and the decisions I have made in the last 3 years or so with my business are a blog for another day......Funny thing is in the middle of it all I knew we would be ok.....I am so thankful we landed in a better place, know not everyone has.....yet.
From Anna Matsunaga, Team Momentum, Keller Williams Tacoma
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