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February 2010

Going to counseling with my wife

Yeah, so I haven’t really spoken about it on acloudtree. But for about 7 months, my wife and I have been going to counseling.

*GASP* “What? Counseling!?!” you ask.

Yup, counseling. And let me tell you, I am thankful that we have been making the effort. Gracie came into our lives around October, which has been a welcome blessing. But we knew even before she was born, that we were already going through a rough patch.

Now in almost eleven years of being together, Jaimi and I have only needed to go to counseling once before. But this time it was different. We weren’t arguing a lot like the newly weds we were. We just seemed to be allowing the slow drift of discontent to wash our love away.  The miscommunications to pile high and the unspoken assumptions to divide our hearts like a worn deck of cards.

Culturally, I realize that it is hard to wrap our western minds around counseling. Actually admitting to ourselves that we can’t do this. The blatant neediness. But let me tell you, neediness is a good thing. Letting my ego and pride get minced into tiny bits is a good thing. Spending focus time with the woman I have promised to love is a good thing.

A common thread I found, in asking people who they personally receive counseling from, is that everyone feels it is hard to find the “right” person. To trust someone with a closet full of skeletons all holding baskets of dirty laundry. But getting hung up here, is missing the point. For me, I’m not their to impress the counselor. I don’t care that he probably realizes I am a jerk at times. All I need the counselor there for is to make sure that I hear my wife, and that she hears me. And our counselor Layne is great at that.

The interesting thing in all of this, is that I get the feeling that Layne is more eastern in his mind set. Where as Jaimi and I grew up attending your standard Christian church. But where most people would run away from that difference, for fear of being “corrupted”, Jaimi and I welcome it. We always go in listening, then we keep what works, and drop what doesn’t. Acknowledging that the key in all of this, is that we will both have to submit, to humble ourselves, in order for the marriage to thrive.

The easy part this time around, is the “why”. Where before it was just Jaimi and I, battling our separate selfish sides. We now have this cutie to care about.

Ultimately we do this in hopes that Gracie can see her parents model a working love, not an regime of the heart. And so I encourage anyone reading this, especially husbands, to try and open up yourselves to the possibility that counseling can actually help your marriage.

Choose your own financial adventure

I posted a hypothetical question over on the Bend Economy Bulletin Board. It was the direct result of a conversation with a buddy. I am always of the opinion that the more voices I listen to, the better my decision will be. And would encourage anyone who is interested in their financial future to think about using the forum to ask questions. Plus, there are several smart people who frequent it, so that helps.

Keep in mind, no one is saying you have to actually use the advice. So ask yourself “what can it hurt?”

LINK

How to calculate the true cost of Real Estate

I have several articles that you probably should read concerning real estate, here and here.

Now for a long while (over 6 years) I have been bearish on RE. For those who may not understand the term bearish, it pretty much means that I think that purchasing a property has NOT been a good move. But things are changing.

Take these homes for example.

Some things I know after researching the homes using DIAL and the CLERKS records are.

  • They are both short sales
  • They are right next to each other
  • They were built for $106k in 1996.
  • Annual tax is around $2k

Now how can we distinguish if this is a good deal? Well lets lay some ground work.

I currently rent a crappier home than either of these for $775 a month. So if my net monthly cost is less than $775 a month, this tells me that I should consider “buying” a home. So I go to bankrate.com and open up their mortgage calculator.

The homes are asking $89k, and I would put down roughly $20k in cash. Making the loan amount $69k. And with a 15 year fixed and good credit, you should be able to pull close to 4.5% on the interest. You can see that the monthly payment is then $527.85. This may lead you to think “Jared, you would be saving $250 dollars a month, what is stopping you?” and that is a reasonable question.

If you look up the properties in DIAL, you will see that the annual taxes due on the homes is roughly $2k. Dividing that by 12 gives you your monthly tax rate at $166 a month.

$527.85 + $166 = $693.85

Monthly Mortgage Payment + Monthly Tax Rate = $693.85

Which doesn’t look quite as attractive, but is still interesting. Finally you should calculate maintenance costs. Which most people say the bare minimum is 1% of the purchase price. Realistically, I think we probably should go with 2-3% of the purchase price for these older homes, but for the sake of this post, we will just use 1%. 1% of $89k is…$890 which we will divide by 12 to get our monthly maintenance cost. $74.16.

$527.85 + $166 + $71.16 = 765.01

Monthly Mortgage Payment + Monthly Tax Rate + Monthly Maintenance Cost = $765.01

Yes, this looks really attractive, but I also want to add the transaction cost (The amount you pay in fees to the RE agent, Mortgage broker). I will have to guess a little bit here, if a real estate agent can shed some light I would appreciate it. So lets say that the total fees paid, is roughly 7% of the purchase price.

$89k x .07 = $6230

Now divide $6230 by how many months you will have the mortgage loan for. In our case, it is 180 months.

$6230 / 180 months = $34.61

Keep in mind that if you roll any of the fees into the loan, then you will pay interest on them.

$527.85 + $166 + $71.16 + $34.61 = $799.62

Monthly Mortgage Payment + Monthly Tax Rate + Monthly Maintenance Cost + Monthly Transaction Cost = $799.62

This is the basic math I use to figure out if I really am getting a deal or not. The interesting thing here, is that an investor could potentially buy this place. I mean they could maybe rent it for $850. So they would make ($577.85 x 12) $6934.12 annually on a $89k purchase. Roughly 7% +/-. Not a terrible investment using this math.

I did call about these homes, supposedly they have several offers. Thing is, with over 400 Notice of Defaults in January, we all know that there is plenty of inventory. Meaning that there is absolutely no freakin rush to “buy” a home.

Anyway, just some thoughts for people to consider before they purchase and please comment if I missed something.