Filed under: Introduction
OK, I agree, I have been a bit lazy in keeping this blog current and up to date. I don’t really have many excuses. I had been very busy over the last year or so. I am even busier now, but I will try to keep my blog as current as possible. There were so many comments that I had to delete from my previous posts.
We moved into our condo in September ’05. I lived in apartments for the last 5 years. The amount of rent that I paid over these years is a staggering $37,744.00. This is money that I have shoved down the drain in the past. I have not factored in the savings that I have realized by living so close to work that I could walk. If I had bought a condo in 2000 when I moved to the denver area, I could have built a few thousand dollars in equity.
Better late than never, I said ,decided that we need to buy a home. I ran some affordability calculations and figured it would not be a problem to afford as much as 220K in the value of the house. I found a nice real estate agent who would show me “for sale” properties around town. We started at a budget of 170K (even though we knew we could afford more).
Our Search criteria were simple. We were looking for a home that was
- recently built because being first time buyers, we were apprehensive about getting into any sort of repairs
- close to my work area, preferably within 5 miles
Within a week, we realized that we had to increase our budget to around 300K and look for houses built before 1995 to find anything in the area that we were looking at. Since we were moving about the affordability mark here, we decided to expand our area of search. We found this condo community, 9 miles from my work place. This is about 1500 Sq ft., 3 BD, 3 bath. We liked the floor plan. The location is excellent, tad pricey. We decided to put $1500 in earnest deposit and keep looking. The builder offered to pick up closing costs of upto $5000 and furnish aluminium blinds for the entire unit as incentives if we did the signing before March 26 2005 and if we financed our mortgage from Countrywide. We took advantage of the offer. The condo was supposed to be ready in the first week of august. We figured we had time to back out of the contract if we found a better home. Soon, we started visualizing ourselves living here and the keep looking plan took the back seat and gradually faded away.
We worked out some numbers and found that the monthly payment was going to be somewhere around $1400. At that time, we were paying $700 in rent. So, just to be sure, we decided that from Apr 2005 onwards, we would put an extra $800 into a savings account on the first of each month, to figure if we can really pull off this homeownership thing. We had until august, to try this out. We were able to manage just fine. Construction began and got delayed in the initial stages because of heavy rains. But they were able to make up a couple of weeks pretty quickly. As closing time approached in august, we checked to make sure we were getting a good interest rate. We got a 5.75% rate from Countrywide which was pretty good at that time for a 30 yr fixed conventional loan.
I had an unexpected business trip to Denmark come up. Since it was summer, my wife wanted to join me. We used part of the money that we had saved up from Apr-Aug to get her flight ticket. We came back in the last week of august and closed on the condo the following week. The closing costs came upto $4600 and about $400 was going unused. I asked if we could pay up the HOA dues ($122/month) for 3 months in advance and consider that a part of closing costs. It worked ! I guess it never hurts to ask.
Fast forward to Apr 2006, here I am writing this blog from the same condo. I enjoy living in this condo. My monthly payment as we figured is less than $1400. I put down 15% and rolled the PMI over into the amount being financed. I am not sure if this is a good strategy, but I really hated paying 8% in interest to the piggy back loan, if we had chosen to do so. Paying PMI is simply out of the question. I figure my HOA dues will increase sometime, but I plan to be actively involved with the HOA so we can increase the dues only if absolutely necessary. Builders often try to attract prospective buyers by lowering the HOA dues, but it is the owners’ responsibility to try to keep expenses down.
Filed under: Introduction
This is my first foray into the world of blogging. There are a lot of personal finance blogs out there already. Is this blog going to make a difference? Maybe, maybe not. I want to share with the world, my ideas, philosophies of investing and get input from people who are better at certain things than I am. I want to write about my spending habits, my earnings and other aspects of life in the US, from an Indian's point of view. If you like to comment on anything that I write, feel free to drop me a line. I reserve the right to remove spam though.
One of the hardest things that I had to do before writing this blog was to actually come up with a creative name for it. 2million has been taken. So is all things financial, my money blog. Someone even got yet another financial blog. So, I chose Try2BeKuber. Now, that needs some explanation. Being indian, I am probably going to make a lot of references to India, indian culture and mythology among other things. Kuber (pronounced ku-bear) is the god of wealth (just like Pluto was the greek god of wealth). While I certainly have more human aspirations in terms of networth goal, try-to-be-ku-bear sounded catchy.
In the next few posts, I will write more about myself, my financial goals and report card, raves and rants etc. After all, what is a blog for? Keep reading.
