The Up-Side of the Mortgage Meltdown

I want to share with you how we were able to buy a barely-lived-in house during the present economic downturn.

For some of us, the present economic downturn happened very personally several years ago.

In 2001 I was laid off from a six-figure job in the dot.bomb recession. Living in California with a lifestyle and family to support, adjusting to living on unemployment wasn't difficult - it was impossible.

What often happens to families in such situations happened to my family. After struggling to find work for more than a year and using all our savings to keep paying bills on time, we were forced into a major life change, and
what we were forced to do five years ago has made us able to get credit now.

Here are the major changes we made:

1. NO credit cards. Everything we buy is paid for using cash or debit card.
2. NO new cars. The new ones are gone. We still have two, but both are paid for.
3. Debt consolidation. All our credit card are paid off.

Although we were living in Southern California, my husband's primary gig moved to Las Vegas, so we decided to buy a house there rather than having him drive the four hours back and forth every week.

Here's what we did:

We set our limit, got pre-qualified for that limit, and set out to find a Realtor. We happened upon a great one, Kathi Russo .

Since my husband was already in Las Vegas four days a week, he took some time every day to look at houses with Kathi. He also set into motion the wheels that grind out the loan with another great asset, Michael Cook from Nationwide Credit Clearing.

What most people don't realize is that many of the houses in Las Vegas which are presently owned by the banks were built within the past two years. Las Vegas was a real boomtown and people have been flocking there to take advantage of that fact. This resulted in much overbuilding. People and companies who were speculating bought up homes in new developments, expecting to flip them. What actually happened - well, we all know that from the current state of affairs. Now those bank-owned houses which sold for $300,000+ two years ago are selling for $150,000.

So one week last October I drove to Vegas to meet with my husband and the Realtor, Kathi. We looked at five, and settled on one, and we made our offer. It seemed to take forever for all the pieces of the puzzle to be assembled.

I don't know what it was like in the housing market before, but this time it was tough to get everything okayed. Even after all the papers were signed and we were waiting for escrow to close, the lender would ask almost daily for us to send proof of how much cash we had in the bank. We had to document where the money came from, and everything was contingent upon the proof that the new job was real and permanent.

At last escrow closed and we moved in the day after Thanksgiving. We got a 3-bedroom, 2.5 bath house built in 2007 for a cost within our budget. The community is quiet and crime free in the emerging Southwest corner of Las Vegas. For me, the outcome was positive, but the experience was harrowing. Maybe next time I'll find it less so.

I'm writing this article to let you know that even though the economy looks gloomy, there is no reason to believe the naysayers. Banks are lending, but they're being careful. Now is the time to buy a house!