mad anthony

Rants, politics, and thoughts on politics, technology, life,
and stuff from a generally politically conservative Baltimoron.

Friday, April 25, 2008

Oh noes, my mortgage....

So, I'm feeling like this lolcat right now.

No, my mortgage didn't readjust, since I don't have an adjustable-rate mortgage. But my payments just went up about $150 a month. The reason is one of the two things in life that you can't avoid - specifically, taxes. County property taxes pretty much doubled, which means my escrow account went negative, which means that I need to replenish it as well as pay more towards future taxes.

Is this going to bankrupt madanthony? No. Luckily, I've been doing OK lately thanks to overtime and good eBay sales, so I've got a little bit squirreled away. But the higher taxes, combined with higher gas prices, will be cutting into my ability to save towards financial goals - and ironically, one of those financial goals was trying to get some more equity in my house so I could drop PMI. Having more of my money go to taxes means less can go to savings, which means it will be a longer time until I can get that stuff paid off. It also means that I should probably start watching my spending habits again, not eating out so much, not buying stupid crap I really don't need, ect. Not that I do those things a lot, but if I can cut some of them out, it means more money to spend on - well, taxes and extra mortgage payments, which are pretty hard to get excited about.

Of course, it's really frustrating because if you accept the prevailing wisdom that the housing market is in the shitter, my house is probably being appraised for tax purposes for more than it's actually worth.

There has been a lot said about why the housing market is in the shape that it is, and what role is played by all the parties involved - borrowers who borrowed amounts they should have known they would never be able to pay back, lenders who loaned to people who shouldn't have been able to finance a ham sandwich (note: most financial advisers suggest you should pay for ham sandwiches in cash), the government for letting people do stupid shit. My tendency is to blame homeowners, and to a lesser extent mortgage brokers and banks. But this makes me feel a little more sympathetic to borrowers - even someone like myself who did the "responsible" thing and got a fixed rate loan is still a little surprised by how many hidden costs there are in owning a home - between increased taxes, all the additional things you need to buy for a house, and the cost of replacing surprise things like a leaking air conditioner or a door that no longer opens from the outside. I can understand how someone can get overwhelmed by costs they weren't expecting.

Not that it's not their fault - you shouldn't buy a house if making the minimum payment means that you have no wiggle room in your budget, and you should always have some emergency savings in case the unexpected occurs. But home ownership is more expensive and risky than most first-time homebuyers realize, and with the price that houses went up to, it was difficult to buy a decent house without spending more than you would like to.


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