September was a milestone month for me. I closed on my home and managed to bring the last of my credit card debt down to single digits. The entire mortgage process kicked my ass and dragged me for filth. How bad was it? I was rejected three times in the last nine months just days before the expected closing date.
I know getting a mortgage today is hard. I was told that you must have pristine finances and credit if you hope to have any real chance of closing on a mortgage today. I was also told it really has nothing to do with the color of a person’s skin because today the information is plugged into a computer and the computer makes the decision.
Well, I say bulls@$% to that!
I won’t go into all the dirty details about the process in this entry but I will say that it has been a little more than a week since I’ve closed and I’m really considering therapy.
Would I do it all over again? Absolutely. It was made abundantly clear to me that “the powers that be” work extremely hard to keep brown people from owning property, so that means we should move heaven and earth to make sure we all own something, I don’t care if it’s an empty lot. I’ve attached a few articles that I think you should read just so you know what you are up against when you start on your journey:
https://www.nytimes.com/2014/02/02/realestate/race-gap-on-conventional-loans.html
http://time.com/money/4354981/mortgages-blacks-hispanics-banks/
Now for my net worth update. I always kept the account for my home purchase separate because I knew one day that most of it, if not all of it would be used for my down payment and closing costs. Well, now that the dust has settled. I was left with a pleasant surprise of $4,708 left in the account.
I decided to put $3,000 (okay, $2,950 to be exact) on my last credit card bill (BOA) and I moved the remaining balance ($7,250) to a zero-percent card. I couldn’t make any moves with my credit while applying for and waiting to be approved for my mortgage or I would have done this sooner.
Having applied the $2,950 to my debt I still have $1,758 left in my down-payment account. Since the account is also where my taxable stock account happens to be I’ve decided I’m going to keep the account open instead of closing it as planned. The account allows me to buy stocks without having to transfer money from my checking account (super convenient and budget friendly). Also, I’m going to have $200 automatically deposited every month.
This will be the money I use to buy stocks that I’ve been watching, purchase CDs, or add to my IRA, if I haven’t managed to max it out for 2017 by April. Sidebar, in case you didn’t know, we all have the entire year plus the first four months into the next year to max out retirement accounts. Basically, we have until April 15, 2018 to max out our retirement accounts for 2017. That’s more than 15 months to max out your retirement accounts.
I won’t let the account build past $2,500. Anything over $2,000 will be transferred
to my AMEX Personal Savings Account every couple of months.
Since closing, AMEX PSA has officially become my emergency fund. I made this decision after watching them raise the interest rate for three consecutive months. You should know that the AMEX PSA has an interest rate of 1.25% with no minimum required to open and no minimum to receive the full 1.25%.
I had planned to increase my automatic deposits for (retirement and savings) by 1% for the new year. But I’ve decided to hold off on that until I have a healthy emergency fund. The amount that I considered healthy while renting wouldn’t go very far now. The progress is slow but headed in the right direction. I wonder where this money would be if I didn’t sit down and automatically direct it into the accounts listed below.
September Net Worth Update
Assets:
SEP IRA: $4,723.95
IRA: $6,398.88
CASH: $3,901.87
MM: $2,412.97
Stocks (taxable) $2,248.29
I-bonds $6,485.59
Investing fund $1,758.16
Liabilities:
Credit Card $7,250 @ 0%
