Punished for trying to do the 'right' thing

Whoever heard of punishment for trying to cover your debts?  Several years ago my husband and I decided it was time to move to a bigger house.  We knew we might be housing my parents sometime down the road and were searching for a place with more space. 

With the fall of the economy it was a good time to purchase a home, but a bad time to sell one.  We decided to keep our current family home as a rental property and move into a bigger home better suited for our future needs.  Additionally, I thought the rental property could eventually be sold to fund our lives during retirement.

It wasn't hard to qualify for two mortgages.  Turns out that banks were giving mortgages to people who could not afford them.  According to the mortgage company we cold afford two mortgages as long as we had renters or as it turns out not eat.  There was no discussion or thought if we could afford the two mortgages if we didn't have a renter.  Feeling liberated and set on being grand landlords we set out on our new adventure. 

We later found out later that our mortgage on our first home was written in less than legal terms.   The mortgage company refinanced our first house and then gave us a new loan for the second house.  The type of mortgage for our first house was meant for a homesteaded home and not a rental property. The mortgage company was fully aware of our intentions to rent the first home and live in the second.  This bit of information would create problems down the road.

We started out on our landlord journey learning that there are tons of unscrupulous people in the world.  We had several tenants over the course of a two plus years.  The first tenant signed a lease and then failed to move in.  We had to scramble to find someone new.  This left us two months to cover the mortgage of that house.  The second tenant moved in and out within six months, breaking the lease and destroying the house.

We decided the 'right' thing (or what we felt was the only answer) and fix the house, keep paying the mortgage and find another renter.   The lack of rental income was a huge strain on our finances.  The decision was made to cash out most of my husbands retirement fund to purchase materials to fix the house and keep the mortgage up on the property.  It took three months to fix the house and re-rent.  The cost was thousands of dollars.   The third tenant moved in and paid the rent on time for two months.  Things started going downhill from there.  She stopped paying rent and for two months I called, left notes on the door and mailed her letters regarding the rent.  When I finally spoke with her she said times were tough, etc.  I was forced to file the paperwork to have her legally evicted through the courts.  She continued to live in the house without paying rent for two additonal months.  The day before the Sheriff was to arrive to evict her from my house she left.  This left us with four months of unpaid rent. 

Tax time was upon us by now and since we had cashed out my husbands retirement we learned that even though we paid penalties and taxes at the time, the money pushed our combined income into a new tax bracket. We now owe the IRS $11,000.  We had to set up monthly payments to pay off our debt.

It was a couple of months before we could find another renter.  By this point we had fallen far behind on the mortgage of the rental and our family home in an effort to juggle the debt.  We could not possiby catch up and cover both mortgages.  The renter moved out as the house went into foreclosure, but we were luckily able to save our family home.

Even during foreclosure we attempted to right our issue the best we could.  We contacted a realitor to short sale the house to ease the loss of money.  The house was worth much less than what we owed and figured that we would fair better from a short sale than an out right foreclosure.  Neither foreclosure or short sale were routes either of use felt comfortable with, but there were no options left.  Both of us are honest people to a fault and have always been responsible for our own debt. In past times when money was tight and we were short on paying our bills one of us would get a second job to make ends meet or sell something of value.  Many birthday and Christmas presents made their way to the pawn shop.

But at this point they money owed is far more than either of us could generate in a reasonable amoutn of time.  We received a total of three offers on the house.  Each offer was considered and denied by the mortgage company.  It was determined by the third offer that our mortgage was not eligible to short sale because of the type of mortgage.  We were foreced to give up.

The house went into total foreclosure.  It sat for more than two years as the government and the banking industry fought over the fradulant mortgage market.  Eventually the house sold at auction January of 2012.    We have been lucky that the remainder of the loan has been forgiven, but we did not escape the IRS charging us income tax on that money since the house was not our primary residence. 

Just as we are close to paying off our tax debt for cashing out a 401k and being bumped into a higher tax bracket we are saddled again with a tax debt of $19,000 for the 'forgiven' loan.

Over the past four years I have had multiple people steal money from me by living in my home for free or breaking a rental contract, destroy my property; unexpected tax on money intended to pay off my debt and then taxed again on my poor real estate decision.

My intentions in the beginning were to provide a space for my parents who were facing foreclosure themselves and rent a home with the hopes of one day selling for retirement, but my hopes have fallen way short. 

Many people have purposely let their homes go into foreclosure.  I have seen those same people buy new cars, go on expensive vacations and do pretty much to their hearts content from money that should have been paying the mortgage, property taxes and insurance.  It is true that eventually those people move out of their almost free home and into a rental property and are saddled with a poor credit score.  I too have a poor credit score, but I attempted to pay my mortgage and got taxed only to further tighten my budget.  And just when I see the light at the end of the tunnel I am hit again by more taxes. 

My family vacations are trips to visit family.  There are no extravagant vacations or brand new cars for every family member.  Our monthly payments will continue for several more years to the IRS and once that is finally finished I will begin to dig out of my student loans that have had to sit untouched for years until the budget allows for payment.

While I am dismayed by the way society has ignored their responsibilites since it has directly impacted my life substantially.  I still feel doing the 'right' thing is the 'right' decision even if it will take years to 'right'.

.

Parenting and Heartbreak

Motherhood

I had spent months planning for my first child.   Every moment was planned out from conception to birth.   I remember looking at the empty crib unable to imagine what it would be like for a little person to occupy that space.  I was so excited to begin the part of my life I had dreamed of since I was a small child.  All I ever wanted was to be a mom.  I never had any other aspiration for a career besides parenting. 

At the age of 21 my first child was born.  A son.  It felt so unreal that I walked into the hospital as just me and then suddenly I had a baby.  They just handed him over to me like it was nothing.  He was mine to care for, to teach.  I had some much love for him.  I never thought I could be this in love with another human being.  Even now I tear up over thinking about those feelings.

I miss that dependence from those years.  The overwhelming need that a baby places on you.  You are their everything and they offer unconditional love.  Infancy is a wonderful time of life.

Here I am years upon years later and my baby is no more.  I'm not sure what happened to the time between then and now.  It seemed to fly by in the blink of an eye.  I feel like I did my best as a parent.  Sure, I have regrets about how I handled some things, but there is no handbook on how to be a parent.  You have to learn as you go. 

I spent years fighting for my way to raise my children.  I wanted them to be open minded, accepting, generous and loving.  I wanted my children to be individuals and if they didn't want to be like everyone else, that would be ok. 

You can't predict how your children will grow up.  You must provide a supporting environment as best you can, the rest is up to them.  A mother's love is unending in my book.  No matter what they do or don't do you keep pushing them to try harder, to get to that next mile in life.

Unfortunately life changes, those miles come faster than expected, people grow up and for that I feel utterly heartbroken.  Some may say that is a strong emotion for something many will think is a normal part of life, but it has been my feeling as of late.  Children grow up, they love others, it's all part of life.  But when a mother feels her son loves someone else more than her its a tough pill to swallow.  The tears have been a regular visitor to my face.

Revelation

At 18 I was engaged to my husband.  One day my mother-in-law pulled me aside and said she was not happy I was taking him away from her.  At the time I didn't understand why she was saying this to me and felt hurt by her comment.  After all, I wasn't taking him, he was growing up and moving on.  Isn't that a normal part of life?  I finally understand her statement, her emotion and while she didn't convey it to me in a very pleasant way, I now know too the heartbreak that goes along with this part of life.  The rocky transition into adulthood.

Suddenly you are no longer the center of your child's world.  Whether they are engaged, dating or whatnot, someone else's world will seem so much better than his own.  My son's focus is elsewhere, his mind is preoccupied.  Yet the fact is that he is still the center of mine, the biggest part of my heart.  He was my first giant love.  And no matter what he does or doesn't do, he will always be that to me.

Somehow I must reconcile these feelings, but that seems an uneasy task.  Emotions are a huge part of my personality and no matter how much I try to quell them they keep jumping out of me.