My Day - and it's only 10:45

[garnigal]

I've been looking forward to today for a month. Turns out it sucks.

We accepted an offer on the townhouse in early December. We'd been carrying 2 places for 6 months, so even though it was ten grand less than our previously agreed upon lowest price, it seemed like a decent deal. And really, it is. It's in line with other prices in the condo development, just 10 grand lower because of the market.

Anyway, today is the closing. We were supposed to have enough to pay back my mom the money she loaned us as a down payment on the new place (essentially a home equity loan) with a little ($500 or so) left over. Basically, today was our fresh start - debts zeroed out, money in the bank.

Except I forgot something in my calculations - penalty for paying off the mortgage.

The mortgage company finally sent the payout today - $9300 in penalties. We were figuring about $103,000 to the mortgage company, but with the penalties, it's $112,000ish. Which means we are $9000 short on Mom. Which means we still have debt and there's nothing left over.

I just keep reminding myself that we did make money on the house. We did get the house we wanted (and we'll never have to sell and move again). Our loan is to Mom, so we've got flexible repayment terms.

It's just not how I was hoping today would go.

Comments

[ares132006.livejournal.com]

I feel for you and your frustration. It always depends on the mortgage contract. Some mortgages (like ours) don't have penalties for early settlement. However, when the interest rates were rising (off the charts last year) people scrambled to take out Fixed Interest mortgages. (Like my nephew) The fixed theirs at 8 point something b/c rates were going, and did go, into the 9 point something. Then the financial crisis hit and interest rates and mortgage rates plummeted. It now stands at around 5%. We have a variable so we benefit. My nephew is stuck at 8 point something for the next 5 years. He would have been laughing if it had gone the other way. His settlement fee is too high to get out. Something near to $20,000. It is their first home and they have only been in it less than a year.

I'm glad that you don't have too much to worry about, in any event. I'm sure your Mum will understand.

Hugs

[garnigal.livejournal.com]

Yeah, we went with variable rates for the new house. We haven't read the fine print on what it would cost us to get out, but hopefully we never have to get out.

Your nephew must be so frustrated, but I guess that's life. There's always renegotiation a few years down the road.