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When It Rains, It Pours…and Your Roof Leaks…and Your Oven Explodes…

Okay, so I will admit it.  I was feeling amazing until last week and all hell broke loose.  I was pet sitting overnight 6 out of 7 days and started getting exhausted.  Then our area of town started getting rain storms from incoming cool fronts.  Then my bed got soaked…it pretty much went downhill from there.

Water Problem

I came to bed at 5:30am last Thursday morning after a particularly rough pet sitting night.  I slid into the sheets, and then my feet were cold and wet.  What?!  I got up, moved my cover, and found out pretty quickly that the entire bottom corner of my side of the bed was SOAKED.

I woke up Mr. BFS and all we could conclude was that water had come through the fan at one point.  The next day, we saw the warped fan blade to confirm.  Mr. BFS went onto the roof, but he couldn’t see anything obvious.  I called our home builder and set up an appointment with a roofing company.

Then a crack appeared in the living room, and grew into a wound on my ceiling.  We still have to wait out the rest of the 5 days for the roofing company since the erratic rain keeps them off roofs.  I’m expecting them later today.

Living Room Ceiling

This gash is what popped up on Friday. Now it’s just wider but doesn’t seem to be getting worse…

 

If they find a problem with a seal or the roof or anything like that, then our home builder will pay them and others to fix everything.  If they decide the water came in some freak way because of the weird storms, our home builder won’t pay for anything.  Great.  You know how fun it has been to wait from Thursday morning through today to find out if I’m going to be out ALOT of money?  Yeah, not fun at all.

Oven Problem

But, as if that weren’t enough for right now, our oven decided to burn out in a spectacular, almost fireworks kind of way on Saturday night.  The heating element literally burned itself out and caused the inside of the oven to belch and burst into flame.  Luckily, everyone in the house knows to turn crap off quickly and breaker flipped.  But the heating element is missing a section now.

My home builder helped me make an appointment with GE for Wednesday.  Yet again, if it’s the product’s fault, they’ll fix it.  But if it’s caused by “something else”, they won’t.  What else could be at fault for a heating element exploding?!

Oven

See that missing section of metal? That shouldn’t look like that…

Mr. BFS is waiting for the 3rd thing to pop up.  I think our third thing is handling Toby, the stray Shih Tsu that I’m fostering, and getting him adopted.  That actually may also happen late this week since he does have interested families waiting to meet him.  Woot!  Fingers crossed!

So yeah, rain can suck.  But at least we handle problems better now than we did 5 years ago.  Heck, we handle them better now than we did 1-2 years ago.  Yay for maturity!  :-)

How has your home been feeling lately?  I think mine is sick…

We’re Preapproved for Yet Another Home Loan

I’m taking advantage of some great advice from Joe Taxpayer at Fincon14.  My husband and I are interested in buying another rental property.  Joe pointed out that financing would probably work better for us than trying to pay in cash in a couple of years.  He also suggested using the fact that we aren’t in a rush to our advantage.

Loan Preapproval

Seeing that we will need another mortgage, we figured that we should get preapproved for a loan before we start the hunt.  We didn’t know about options like the Homestart low deposit home loans, so we approached a brick and mortar bank in our area.  I applied for a $125,000 or less loan, gave all of the info they asked for, and we were preapproved within 24 hours for a $100,000 mortgage or less at 5.375% interest for 30 years.  That’s about a $500 a month mortgage.

Property taxes and home insurance will bring that up to about $850 a month in the areas we are looking at.  We can afford to cover that $850 whether or not the home is immediately occupied, but it is a good market to find a renter right now.  :-)

Loan Meme

Saw this over at http://www.empowereddollar.com/paid-off-my-federal-student-loans/

Type of Property

I mentioned it before, but we are looking at newer (built in 2005-2014), single family homes with 3 bedroom and 2.5 baths that are around 2000 square feet.  The two areas I am favoring run about $90,000-$110,000 for homes like that and rent out for $1200-$1300 a month.  That means with the $850 cost per month for the home itself, we can put $350-$450 aside each month to fund its own long-term emergency fund and to hopefully invest into yet another property.  If we can build up to 5 properties, we’d be set in retirement after we are about 55 years old.  If we can get 10 properties, we should be able to retire whenever that happens…maybe by age 45 or so?

Offer Low, Offer Often

Following Joe’s advice, we can look at all of the homes that fit our criteria and make offers that are 20-30% lower than the asking price.  Even if only 1 in 10 accept, we have a good rental property for even less than we were expecting.  That could lead to even more rental properties sooner than expected.

We have a plan now.  We’re following our own advice and waiting until January 2015 to see where we stand before we truly start the search.  I want us to have $30,000 in the bank aimed at just this rental home since it will cost somewhere between $18,000-$22,000 for the 20% down payment.  Then we have closing costs and minor renovations.  We’ll have an emergency fund to use if anything major pops up, but there is a reason that we are only looking at young properties.

How has your income diversification been rolling along?  Are you interested in rental properties too?

Postpone Our Want List Again to Buy Another House?

Everybody wants something.  I get that.  Mr. BFS and I are no different.  We’ve had an ongoing want list that we add to and subtract from for years.  The problem is that we keep prioritizing other stuff, investments, and trips before some of the things that have been on the want list for as many years as we’ve had it.

I-want-list

Our Want List

Here are the things that we were specifically, consciously spending on this year…or so we planned:

  • Lasik – Mr. BFS has had glasses since elementary school and would like to move along now.  He’s been putting it off for years only because of the small risk to his eyes, but he wants to pull it off this time.
  • Media room furniture – We have a specific plan for 6-7 media room seats/recliners.  But we keep putting off this purchase in favor of everything else.
  • College Referee Training Camp – It’s about $2000 for a one week camp, but if they like you, you get hired to be a college sports official for football.  Mr. BFS would love to move up to college level reffing (which pays more too), but paying for the $2000 camp doesn’t guarantee anything at all.  So he has procrastinated for 2 years…
  • Yet another cruise – I always want to book our next cruise…that’s just the way it is…

None of those things is an actual need, although I would place the training camp and Lasik above the other two myself simply since one could lead to more money and the other is health-related in my opinion.  But we were going to knock-out all 4 in the next 4 months…

Another Rental Property?

Despite us knowing exactly what we want, life has happened and we aren’t sure we can pass up a good opportunity to build our rental property income streams.  Exxon has built an administration complex near our home.  That complex will employ 10,000+ people, but they only built enough housing for about 2500 of them.  That means all of the property in our area is increasing in value.

Sadly, that means our property taxes will be increasing every year for a while.  We may actually have to move in 5-10 years if our property tax gets as high as our mortgage.

BUT, it also means that buying a rental property may make sense.  A 1700-2100 sq. ft. home right now with 3 bedrooms and 2.5 baths can be purchased for around $100,000-$150,000.  That would be $25,000-$35,000 since you need to put 20% down plus 3% for closing costs.  But it could be loaned for 4-5% over 30 years for about $500 a month.  Those sorts of homes are renting out for $1300+ a month.  Even when taking into account property taxes, home insurance, and home owner’s association dues, we’d be bringing in at least $300-$400 extra per month.  We would use that to build a maintenance fund and to pay off the home in less than 10 years.

The only kicker is that $25,000-$35,000 up front just to buy a place and get it into rentable condition.  That would once again eat a huge chunk of our padding and all of our extra money for the want list.  But we’d still have 3-4 months of expenses on hand.

What would you do?  Buy the house and put off the want list?  Finally take care of the want list and put off rental properties for a couple of years?

Trailer Park Treasure

I mentioned that my friend, Dee at Losing Stuff, Gaining Freedom, was looking to buy a used travel trailer to live in for at least a year starting this summer.  She ended up buying a 20 foot long 2008 Malibu in April, but then she needed a place to live in it starting in August when her apartment lease runs out.  Today we went hunting for a decent trailer park/mobile home park/RV park that was closer to her job (and as a bonus, me!).  :-)

Dee's Trailer

This is the 20 foot Malibu that Dee will be living in until August 2015. It takes advantage of its limited space…

Options

As with any other housing choice, finding a place to rent out a trailer slip involves choosing something between disgusting and ranges up to amazing luxury.  Dee called the four options that seemed to fit her basic needs that were also closer to her job than she is now.  Two of the places were completely filled up and didn’t seem interested in worrying about backups.  One place rents out mobile homes that they already park there, so it doesn’t have slips for other people’s travel trailers.  Lastly, there were two places that we checked out in person.

The Basic Choice

The first place looked nice but extremely basic.  It had the land and a low price.  In short, it was an open area to park at, but it also only costs $275 per month.  That includes free water, but Dee would have still had to cover electricity and find somewhere to do her laundry or take a nicer shower once in a while other than in her tiny bathroom.  It also was in an area that would get muddy and marshy when it rains.

$275 Trailer Park

The first mobile home park was nice and green, but it didn’t have anything extra at all.

The Luxurious Choice

The second option was just awesome!  It is an RV Resort, which is a very nice way to live in a mobile home.  The slips for the travel trailers are paved, there is a huge lake that makes for a great view and lends to good drainage, and the amenities kicked butt!

  • Water included
  • Basic Dish television included
  • All hookups for the travel trailer are easy to use and readily available
  • On-site laundry facility that is open 24/7
  • Bathrooms with full showers that are open 24/7
  • Computer room with a printer
  • Two enclosed dog park areas
  • A swimming pool and hot tub
  • A recreation room with treadmills, a shuffle board table, a pool table, a coffee maker, and a popcorn machine
  • A huge lake that can be used for fishing
  • Free air pump for tires
  • Dog wash station with an actual dog washing platform and sink
  • Grills
  • Outdoor kitchen with bar stools
  • Fire pits with comfy outdoor seating
  • Friendly staff

The only downside is that the monthly rate is $475-$540 a month.  BUT, they offered Dee a deal that she couldn’t pass up – rent for one month and get the second month free!  That will make it $270 a month at worst for two months, and then she can decide to stay or move on!   How cool is that?!

The Lake

Pool

Rec Center

Fire Pit

Obviously, she chose the RV resort.  She’ll be moving there in early August and I am so excited for her!!!  I think it’s a perfect fit and still costs her $400 less per month than her apartment complex wants now.

This is proof that housing treasures and great deals can be found with any type of home – even travel trailers.

Any cool housing deals for you lately?  What do you think of this RV resort?

 

Our Rent Home’s Air Conditioner is Back to Life

The air conditioner in our rental property died Sunday afternoon.  Our friend and Mr. BFS figured out it was the capacitor.  I thought of a couple of options – finding the part ourselves online or hiring our normal a/c guy.  I didn’t want our tenant to suffer any longer than necessary, but I also didn’t want to pay an a/c guy for something that we can actually do.  Oh well.  :-)

Broken AC

A/C Success

Our normal a/c guy wasn’t working Sunday evening, but I tried again Monday morning.  He made it to the rental house by 12:30pm and the air conditioner was working yet again by 1pm.  It ended up costing $40 for the capacitor and $75 for the trip and labor fees.  We’re okay with $115 total but now know that we can replace it ourselves quickly if it happens again.

Third and Future Option

I thought of a third option for the future.  If we ever need to replace the capacitor again, I’ve decided that I’ll call around and find someone who sells the part here in Houston, TX.  That won’t take 2 days to get thanks to shipping, and Mr. BFS says he can have it installed in less than 20 minutes.  So we’d save $70-$80 overall.  Not too shabby.

Overall, this is a happy ending.  Our tenant isn’t melting anymore and one thing is off of my errands list.  Yep, that’s a win even at $115.

Any happy financial endings for you lately?  Let’s share good news!

Summer is Here – Of Course Our Rental Home’s A/C Would Die…

You read that right, the air conditioner in our rental home stopped blowing cold air.  It’s hitting 91 degrees during the day already, so this is pretty dang important.  Forgot to add in the original post that I first tried calling the a/c repair guy that we have always used, but they were already closed.  Mr. BFS and our friend went over immediately and narrowed down the problem, but our quick fix didn’t work for more than an hour or so.  It definitely didn’t buy me any time.  Now I am searching for a working a/c capacitor that can be delivered ASAP.

Broken AC

The Hypothesis

The system worked when our friend pushed along one of the rotating parts of the capacitor.  I’m calling this the “starter-thingy”.  BUT, then it stopped working again in an hour or so and the trick with pushing along the starter-thing didn’t work again for long.

Our hypothesis is that the air conditioner unit has a dual capacitor – a capacitor with a “starter-thingy” and a “main-capacitor-thingy”.  Well, we’re guessing that both parts are bad.

Long story short, I’m hitting Amazon.com and other online sites to find a good, FAST deal on the correct capacitor.  But we have the wrong numbers written down and my tenant is asleep (she also wanted to double-check the numbers in the morning when the sun was up), so we’ll need to figure out the exact capacitor model number as early this morning as we can so I can keep hunting.  I’m writing this post at 1:30am and haven’t had any luck yet.

Best and Worst Case Scenarios

Best case – I find the capacitor we need on Amazon via Amazon Prime and we have the part by Wednesday, install it, and it works.  This would run us less than $50.

Worst case – we call out our a/c repair guy, it isn’t just the capacitor, it’s something irreparable, and we have to fork out $5000 for a new air conditioner.  This scenario also takes WAY longer.

Realistically – I find the correct parts but it takes us a week to really find out every issue or to have the part(s) delivered.  So this would take about the same amount of time as the worst case scenario, but costs way less.  It costs more than the best case scenario, but takes more time.

I’m handling this all right now, so this is to be continued…

How is your house or rental property treating you or your tenant right now?

5 Strategies for Relocating on a Budget

The following is from James Felton, a homeowner living in Atlanta. He writes about real estate, family and home, and personal finance.

If you’re thinking of moving to a new residence this year, you’re not alone. According to the Census Bureau, roughly 36 million Americans moved in the last two years. And while moving might appear tempting, or even necessary, it’s certainly not cheap. If you’re gearing up for a move, keep tabs on your expenses by employing the following five strategies for relocating on a budget.

Relocating

1. Move Yourself

The process of moving isn’t as overwhelming as you might think. Invite your friends and family members over and make it an event. Serve some inexpensive snacks and beverages to keep everyone fueled, and knock out the work in a matter of hours. You can even go DIY, packing your stuff on your own and arranging it carefully for the move.

2. Declutter Before You Move

Getting rid of unneeded stuff before you move solves two problems – first, you can generate cash to offset moving costs, and second, you reduce the total amount of items that need to be moved.

Sell your unwanted furniture on Craigslist, and open an account on eBay or Amazon to sell outdated electronic devices. Price everything low so it sells fast. Sell your books to Cash4Books – you don’t even have to wait for a buyer, you just send them in.

If there are other items you no longer need, but don’t feel comfortable selling, donate them to an IRS-approved charity to get a tax break on next year’s return. Ask for a receipt when giving items away so you have the necessary documentation on hand when you file your return.

3. Take Advantage of Tax Deductions

If you’re moving for job-related reasons, there are several tax deductions you might qualify for. Refer to IRS Publication 521 to get more information. You might be able to write off the cost of packing and shipping your stuff, as well as the cost of gas and lodging while you move.

4. Negotiate Monthly Services

As you’re in the process of setting up Internet and cable TV service, negotiate hard for better pricing. Competition is high, so vendors must vie for your business. Research the best deals (bundled options are usually cheaper), then call the provider to see if they can beat it. Avoid signing a long-term contract whenever you can so you have the option to switch services down the road if another great deal comes along.

5. Reduce Costs Post-Move

Think ahead to the first few days after you’ve moved – the kitchen probably isn’t set up and the fridge is most likely bare. To reduce the expense of eating out and exploring your new town, sign up for a deal of the day website, such as Groupon or LivingSocial, and enter your new zip code. You’ll get deals and discounts sent straight to your inbox for half off (or more) on local restaurants and other entertainment options.

If you’re planning to use a moving company, check with the Better Business Bureau to see if the company has received any complaints. Be sure to choose a company that inspects your belongings before providing an estimate – onsite estimates are much more accurate than those conducted on assumptions. Seek out at least three written estimates before choosing a vendor, and do not agree to pay a hefty down payment before the actual move. It’s incredibly important to do your due diligence with any moving company before committing your cash to a provider.

How have you saved when relocating?