**Disclaimer: All of the information included in this series of posts are a personal account of my experiences and my personal opinions. I am not a real estate agent, mortgage broker, financial adviser, or attorney.
Every home purchase deal hits a snafu. Sometimes it’s uncooperative sellers, sometimes it’s a disastrous home inspection. Even if you hit an unexpected snag on your way to homeownership, don’t fall to pieces. There is always a solution, whether it be creative problem-solving, delaying your closing date, or just making the best out of a bad situation. Our snafu had absolutely nothing to do with the home purchase!
Well, almost nothing.
About a week and a half before our closing date, we took our vehicle into the dealership for an oil change and found out that we needed a new engine, ASAP! We were shocked because we had a super reliable vehicle that was only five years old, but we threw a bearing, which resulted in a rod knock, and left us with no option other than complete replacement. Being a one-vehicle family (this might be the ONLY drawback in our experience with being a one-vehicle household–surprise car repairs), we had three options:
Option 1: Pay $5,600 cash for a new engine–Hell to the no, because that would have eaten into our down payment savings. And closing was one week away!
Option 2: Put the $5,600 repair on a credit card–Not preferable, since making a large purchase on credit while in the midst of purchasing a home isn’t advisable. It was also important to consider that Stuart was planning on getting a newer vehicle in the next year or two anyway. Was it worth it for us to pay the money to completely replace the engine if we weren’t planning on driving it for much longer?
Option 3: We trade it in for a new vehicle now–Like many other aspects of our life, this option seemed like the most unrealistic…until now.
Yes, we would have a higher monthly car payment, but our current frugal lifestyle made this the most feasible option. So instead of endangering our down payment savings or racking up more credit card debt (when we could least afford it), we just bumped up the time frame we were planning on purchasing a new vehicle. The only change for us would be taking funds from our large chunk of money allocated to savings each pay period and putting it toward a car payment (and slightly higher insurance price). For us, this would have a low impact on our financial state at this point.
So…we purchased a new vehicle.
And I learned to drive stick shift over the weekend.
Honestly, learning to drive stick before going back to work on Tuesday was the most stressful part. Yes, our car payment increased, but our budgeting habits and financial planning made this a possibility rather than a crisis.
In the end, we made it to closing without the snafu affecting our home-buying process too much. If we had paid for a new engine on credit or dipped into our down payment cash, closing would have been delayed significantly. This isn’t to say that you should throw down for something you can’t afford, but having your financial ducks in a row will allow you to make informed decisions and deal with any financial crisis more quickly and accurately (and hopefully with minimal stress).
Purchasing a new vehicle unexpectedly and in the midst of closing on our home was our major snafu. However, I will say that this is where my earlier comment about the mortgage underwriters comes in…
We made it through the new car purchase and were feeling pretty confident about getting through the next week and finally making it to closing. Then, three business days before closing, our mortgage originator calls and says that–emergency–the underwriters said they never received the tax info I faxed them from the IRS with my maiden name A WEEK AGO and if they didn’t get it by the end of the business day, our closing would be delayed. This is also after we found out that this same person with the underwriters had been gossiping with our homeowners insurance representative that our closing day might be postponed before even telling us! Needless to say, we were furious, and I emailed scans of the documents to everyone.
Fortunately, everything turned out OK and our closing was not postponed, but it was incredibly annoying having to scramble because the underwriters waited until, literally, the LAST MINUTE to inform us that they didn’t actually receive the documents we sent (and also discussing our closing date with other people before even informing us). But, you know what? If you can get through it without disastrous results, it’s better to just let it go and be glad that you’re able to move forward!
So there they are, the inevitable crises associated with a major life change and how we managed to survive them.
Keep an eye out for the final installment of the Bluegrass Bones Home-Buying Series, CLOSING THE DEAL! Truth be told, this was the most stressful part of our entire experience. Mostly, it was due to unforeseen events and miscommunication by multiple parties, but we made it through!
Stay tuned, friends!