Some Good News

Since I spent so much time bellyaching here about our cashflow problems, I thought I should at least report some recent tidbits of good news.

  • We did not run out of money at the end of February. Granted, it’s a short month, but I think our austerity measures are paying off.
  • I did our taxes yesterday, and despite my fears we are indeed getting a substantial refund.
  • My online tax prep service (TurboTax) turned me onto Mint.com. I’d Iooked at Mint before but for some reason it never clicked. Now I see the appeal, and perhaps it will be helpful in the long term. In the short term it’s already yielded confirmation that we’ve reduced our grocery bill. It’s much easier than tabulating manually, and with nifty graphics too boot.

Grocery Comparison

Austerity Program

Blood & Money

While politicians in DC wrangle with cutting the federal budget, I’m trying to do the same thing here at home. It ain’t easy. I suggested to Xy we might cancel our newspaper subscription — she was not happy about that. Well, neither am I, exactly. But a part of me relishes the challenge.

First a glimmer of good news. Because of some sort of federal social security rollback, my monthly take-home pay just increased by $72.33. I guess Xy’s should have increased as well, but it’s actually gone down $1.50. Not sure why. But it’s still a net gain of $70.83.

Also, we were overpaying by $100.00 per month on our car loan. This was an intentional decision on my part, in order to pay it down more quickly. Same with our house note. But in the interests of cash flow, we can just pay the minimum on both of these. Of course, our monthly home escrow payment is going up by approximately $250.00, which is what precipitated this sense of impending doom in the first place.

So let’s do away with those two overpayments, combine the $70 take-home boost, and just effectively cancel out the escrow increase.

Awesome. I feel better already.

It’s smoke and mirrors, of course. Remember we were already having trouble making it to the end of each month. We do need to tighten the belt.

Here’s some things we can’t cut.

Cable television: Don’t have it, can’t cut it.
Home phone: Don’t have one, can’t cut it. (But see below.)
Second car: Don’t have one, can’t sell it.
Theater: Haven’t really gone since our daughter was born.

Here’s a breakdown of things we could cut completely.

Books: I’d estimate my monthly book club habit costs me around $12.00 on average. Sometimes we read cheap paperbacks, sometimes expensive hardcovers, and there’s quite a range between. I should be able to borrow most of these books from the library. I work above a library, after all, and there’s always interlibrary loan. I just submitted my first request, for Midnight Robber by Nalo Hopkinson. As much as I like to support my local bookseller, I need that $19.99 this month.

Netflix: $14.99. Easy to cut.

Times-Picayune: $18.95. Vociferous objection from Xy duly noted.

Garden: Our community garden membership is $20.00 per month. Xy does a little work each month, and we get a basket of veggies and fresh eggs delivered on our door once or sometimes twice a month. I love that we’re getting locally grown organic food. I love the entrepreneurship of the guy who started the gardens. I love the educational aspect for our daughter. I really hate cutting this, because I think the food baskets are worth almost $20 in and of themselves, but perhaps not quite.

Yard: I’ve been paying a guy $35.00 to cut our lawn. Sometimes that adds up to $70.00 a month in the summertime when the grass goes twice as fast. It’s not that I’m lazy — really — but we don’t have a mower, and we don’t even have a good place to store a mower. I’m pretty sure a certain friend and neighbor will let me borrow his. I’ll be sure to bring it back right away. Promise. Also, our yard needs a little more attention, plus the exercise will be good for me.

Yoga: $15.00 per lesson at four per month = $60.00. A shame to cut this, but OK.

How much have we saved so far? I make it about $160.94.

So much for that. Now here’s some opportunities for saving rather than cutting:

Internet: Looks like we can save $13.00 if we switch from Cox Preferred to Cox Essential. That would drop us to a max download speed of 12 Mbps to 3 Mbps. But so what? I’m pretty sure we don’t get 12 Mbps during peak hours anyhow.

Grocery: Just as a baseline, we spent approximately $1,032.69 on groceries over the past month. Xy estimates that by hitting the Sav-A-Lot weekly we could save $80-120 per month on food costs. Let’s aim for a nice round $100.00.

Our total in now $273.94 per month. Hooray, this is starting to add up. That, more or less, may be what we need to make up the gap we have at the end of some months.

I was going to say that we don’t go out to eat much, if at all, but I note we’ve spent $116 or so at restaurants over the past month. One night the Sewerage & Water Board shut off water to our house as they fixed a blown main and so we went out and ended up spending $60 that we didn’t have. So that kind of thing has to be reined in.

Here are some costs that don’t appear negotiable, at least not immediately:

Energy: Hard to say, because it fluctuates, and we just added insulation under the house a few months ago. When we had our bill leveled it came out to $188/month. We keep our thermostat at a reasonable level, in my opinion, so I don’t see this one changing. Entergy solicited me to try SmartView yesterday, which is a no-cost pilot program to help people understand (and possibly reduce) their electricity usage — but we earn way too much to qualify.

Daycare: $690.00. I’ve realized our primary challenge is to get through the next four months. Then our daughter will be out of that daycare forever. We’ll get a bit of relief over the summer, and then the girl will begin Pre-K 3 at Xy’s school. It’s not free, alas, though it should be a bit cheaper than daycare. After a year of that, we hope to enroll her in a Pre-K program at a public school. That’s the plan, anyhow. If that works, our financial situation should improve in 16 months from now.

Cell phones: We pay Verizon $141.92 each month for our two phone plans. I have an unlimited web plan for my Blackberry, which Xy says she likes. A friend of mine suggested we could use an iTouch with Skype and save money, but I’m not convinced that would suit our needs. I’m pretty sure Xy would insist on being able to make an emergency call from the road. Perhaps we could tweak the plans we do have, but I find this awfully confusing. I think we’re locked in these plans until July or maybe May of next year. Maybe I need to call customer service.

Insurance: A friend recommended we get our insurance thru USAA, but since we’re not veterans this would require getting my father or father-in-law to buy some insurance. We could buy the smallest possible plan, say supplemental auto insurance for them, which might be worth it in the long run. Suffice it to say it’s a little complicated but bears further investigation.

I remain open to suggestions from all my friends and family. There is power in collective wisdom.

Damn

We’ve been having a bit of trouble making ends meet ever since Xy changed schools and took a $20K pay cut. Sometimes it’s that last week of the month, sometimes, just the last couple days. A number of times I’ve had to draw off our savings to make up the gap. It’s occasionally embarrassing and always worrisome.

We were just getting serious about looking for ways to save on our monthly budget, and then this bomb dropped: Yesterday morning I opened some mail and learned that our mortgage payment will be going up. Substantially. Insurance has gone up, and so have taxes, because our home assessment more than doubled. That’s a bummer, but I don’t see any error there; it seems the house was radically under-assessed last year. It sucks that the bank didn’t anticipate this correctly at the time of purchase, but that’s water under the bridge now. I talked it over with our Realtor and she confirmed that we don’t really have any options. We can mitigate a bit by making a lump payment now, which we’ll do, but the increase in our monthly payment will still be substantial. It’s going to make the monthly budget a lot tougher.

In recent years we’ve counted on a big tax refund, but with our reduced income we rethought our withholding, and so I don’t think we’ll be getting money back from Uncle Sam. We might even owe more. Shudder. Sure is a good thing Obama extended the Bush tax cuts for the middle class. Oops, I said something political. That will surely distract anyone who reads this from my actual point. Why react to my petty personal problems when you can pontificate on massive federal issues?

I have to confess that we haven’t really done any of the belt-tightening I mentioned last June. I wish there was some obvious substantial luxury expense we could forgo. Perhaps we can do enough small things to make a difference.

We always look for bargains at the grocery, but we rarely shy away from a food item because of the expense. We go to the nearest grocery rather than the cheapest. Recently I’ve cut back on the premium liquors and have been mostly drinking Bota Box. I’ve felt at liberty to buy books whenever I want them, which is at least once a month. I indulge in the occasional MP3 download from Amazon. We have our subscription to Netflix, which I still haven’t gotten around to canceling. There’s my yoga class. What else can we cut?

I guess that new fire pit is out of the question.

I may also need to rethink my attitude toward freelance work. I routinely reject queries for basic web development and consultation. Sometimes I do the work for free. But yesterday, motivated by a recent financial embarrassment, I changed my tune and said “yes” when a friend’s husband asked for my help. I quoted PJ’s old rate, $40 an hour, with a three-hour minimum. I’m sure he charges much more now, if he even does this sort of work. Jeez, I need to raise my rates already.

Financial matters have never been my strong suit, but I’m frankly worried how we’re gonna make it.

Exhalation & Disclosure

I feel like I’m exhaling and relaxing for the first time since — when was it? — late July. That’s when the idea of moving first entered my head.

We’d learned our daughter had lead poisoning and then a few days later I had a close encounter with one of the guys from the corner. Ordinarily I would have laughed off the latter, but the news of our girl’s elevated lead level had softened me up emotionally. It was like a one-two punch.

That evening, as we visited our friends on Grand Route St. John, we stood out on the sidewalk having a drink and talking to neighbors. We noticed a house was for sale on their block, and I couldn’t help thinking how much nicer life would be if we lived there.

In the following days I started thinking about it more seriously and finally called our Realtor on August 5th.

I was leery of writing in much detail about the various steps of the process. Not superstition, just caution. Real estate transactions can be tricky, and I thought for once in my life I’d err on the side of discretion. So I started posting lots of music mixes instead of writing about the nitty-gritty details I was sweating.

I will try to recap the process now, mainly for my own amusement and edification. What follows may not be of interest to anyone else, but who knows?

Let me start by backing up a bit. We bought our house in 2002 for $107,000. Our 2009 Real Estate Assessment from City Hall estimated the fair market value at $170,000, which at the time I thought was a mistake:

I’d love to think we could get $170K for the house. But I’m inclined to think it’s less, probably a few tens of thousands less.

Yet our Realtor guessed we might be able to sell it for as much as $180,000. That gave me pause. After seven years of paying down the mortgage, we only owed $88,000. Thus, I realized that we had enough equity in our house to enable us to “trade up.” It wasn’t the lead paint or the destabilized neighborhood or any single factor motivating us — rather it was the general realization that we could improve our quality of life across the board. A “lifestyle change” is what our Realtor called it, a phrase which still makes me cringe, but which is perhaps accurate.

We developed a short list of features we wanted in a house. As we started looking, we quickly determined the houses we liked started at $250,000. Cheaper houses just didn’t seem like an improvement over what we already owned. But how could we possibly afford a house that costs a quarter million? Several factors at work here: With the sale of our old house we anticipated having enough cash for a substantial down payment. We now earn more than we did seven years ago. Plus, interest rates are even lower now than they were then. But really it all boils down to that first item. Not to be overly pedantic, but that’s the advantage of paying on a mortgage versus paying a landlord. I’d known this theoretically, but I didn’t I fully understand it until we started considering this transaction. I calculated our minimal selling price to be around $154,000 in order for us to afford a $250,000 purchase.

I talked to a banker who verified my numbers. Actually I contacted three bankers. I didn’t “shop the rate,” rather I was looking for the best service. We went with Iberia Bank because they seemed a little more on the ball and a little more personable.

We only looked inside two houses. The first was a couple doors down from Michael (and despite what Adrastos would say we considered that a plus) but the inside of the house left us a bit underwhelmed. It needed a little work; we really wanted a house that was ready to go.

The second house we looked at was down a block and around a corner from the first. It didn’t look quite as appealing from the curb, but as soon as we saw the inside we were sold. It was listed for $259,000. We made an offer of $250,000 on August 24th. Our offer stipulated the seller pay $3,000 of closing costs. The seller made a counter-offer, agreeing to the closing costs but upping the sale price to $253,000. We accepted.

I took a week off work to make some cosmetic repairs to our house to get it ready for market. This included repairing the four-year old damage to the kitchen ceiling.

Sorry Ceiling

In the process of scraping the ceiling I opened up a hole in the plaster, but amazingly enough I had on hand everything I needed to patch it up.

Repainted

I also painted the ceiling in the front room to cover some old water stains. They’d been there when we bought the house. I replaced our defunct garbage disposal; if I’d known it would be so easy I would have done it years ago. And I had a new porch light installed. (Thanks, Josh.)

The next week we did inspections on the house we planned to buy, and found some significant deficiencies. The seller eventually fixed these, but to get it done at the level we wanted we agreed to reduce the seller’s commitment on closing costs to just $1,500.

The week after that we put our house on the market. We had our first open house on Sept. 20th. Nobody came. Not a soul. A week later we had another, with only a couple visitors.

I had been secretly nursing a suspicion that this was all an empty exercise, that we in fact would not be able to sell our house and therefore not able to buy a new one, and that we were merely going through motions for the sake of some weird formality, that we were all players following a script, but when the show was over we’d sleep in the same bed as always.

And then, on the last day of September, we got three offers within a few hours of one another. All were from couples hoping to buy their first home. No slumlords. All were hoping to take advantage of a stimulus from the current administration which expires at the end of November.

Following the wisdom offered by my friend and real estate guru John Byrne, we didn’t go for the most lucrative offer. Instead, we selected the one which seemed to have the most solid financing. In fact that offer was the least lucrative of the three. We dickered back and forth over the exact price, with counter and counter-counter offers, and finally settled on $163,000, with us covering $3,000 of their closing costs.

In early October, they did an inspection on our house. The results were interesting to me because we’d never had a professional inspection done when we bought the place. They didn’t ask for us to fix much, probably because they knew were getting the house at a good bargain. We were to replace a couple missing gutter downspouts, replace some broken windows, and repair a couple dripping drainage pipes under two sinks. I’m glad they didn’t ask us to repair the water damage caused by the drip under the kitchen sink.

Over the next few weeks I got these repaired. I asked for referrals on the neighborhood discussion group and found some good people who knocked it out right quick and for a reasonable price. Louis Blady did the gutters so fast it made my head spin. We had six windows that needed to be replaced. Six! (I recently referred to it the “House of Broken Windows.”) I could have replaced them myself, but it would have taken me twice as long and the work would have been half as good as what Kevin Krause did for us. He and our former neighbor Jesus tried to help with the dripping sinks, but ultimately I had to call in JC Services to resolve that situation.

Meanwhile I was shopping for insurance for our new home. Even though I’d been pretty happy with our insurer in the post-Katrina scenario, I didn’t like the rates they quoted me. We ended up going with Whitney Insurance and saving over a thousand dollars.

And so October slipped away.

Somewhere along the line, somebody dropped the ball. I really don’t know who. It’s entirely possible that it was all my fault, but I’m going to blame it on a bad cell phone connection. All of a sudden I was informed we were supposed to close on October 30th. Oops. I already had plans to be in Houston that day. Our buyer was leaving town after that, so the closing had to be postponed until mid-November.

Then we had to negotiate a pre-occupancy agreement with our seller. We agreed to pay $500 for one week’s rent, and move in a week before the closing.

So we got ready to move. Major props to my mother-in-law who spent a week packing our possessions into boxes.

And then we moved. Major props to our friends and neighbors who knocked that job out in a mere four and a half hours.

The week after we moved was a strange one. We were living in a new house, but we did not own it. We were living out of boxes. We were making frequent trips back to the old house which now stood vacant and forlorn (and seeming more spacious than ever) retrieving those last little things like garden hoses and potted plants, cleaning out the shed, and so on. We were also going back there with loads of laundry, since we did not yet have a washer and dryer at the new house, and our old washer and dryer was included in the terms of the sale. It was also a strange week because Seph was out of daycare more than she was in. Monday was a wash because of Ida; Wednesday was Veteran’s Day; Friday we kept her home because she was sick with what turned out to be an ear infection.

On Wednesday our buyers had their final walkthru of our old house, which I attended. It was my first time to meet them; a young couple, buying their first home, they reminded me of no one so much as Xy and me seven years ago. Younger, even. It was a good feeling.

Finally, on Friday the 13th, I experienced the joy and wonder of a double back-to-back closing. There was some last minute confusion of course. The title company was telling me I needed to bring a certified check, but they wouldn’t know the amount until the documents arrived from the lender. They were supposed to be there a day in advance, but as the hour approached the ambiguity remained. Finally I left my office and headed to the Garden District office where the closing was to transpire, with instructions for the title company to call me when they got the amount so I could pass by the bank and get the certified check. But in the final analysis this wasn’t necessary, and I didn’t need to bring a check at all.

We actually made money on this deal. Here’s the final breakdown. We sold our old house for $163,000 and bought the new one for $253,000. When all the closing costs and whatnot were sorted out we left the table with $6,600.28 in hand. We got an interest rate of 4.875%. With hazard and flood insurance, our monthly payment will clock in at approximately $1,400 — only $200 more than what we were paying on our old house.

At the end of the day I believe everyone was happy. Our buyers were getting their piece of the American dream. Our seller was making good on his investment. Our Realtors were getting their commissions. And we were definitely happy with the way things worked out.

I do have to wonder how Katrina and the floods of ’05 factor into all of this. If it wasn’t for the flood, we surely wouldn’t have renovated as extensively. We would not have rewired and replumbed the house. The disaster forced our hand. But it also destabilized the neighborhood. I wonder if our house would have sold for more or less if it had never flooded. And would we have been motivated to sell if the neighborhood hadn’t changed so drastically?

In retrospect I now realize this was the biggest financial transaction of my entire life. Yet it didn’t seem nearly as momentous as when we purchased our first house seven years ago. That event is of course documented in ROX #91 and #92. I suppose that was a bigger transition — becoming a property owner for the first time. Now that we are amongst the landed gentry, trading up is more of an incremental move rather than a paradigm shift.

Closing In

I’m gearing up to sign a bunch of papers in about an hour and a half. First we’re closing on the sale of our old house. Immediately after that we’re closing on the purchase of our new house. The latter is predicated on the former. I have power of attorney so I can sign for Xy who would normally be at work but stayed home today to look after our daughter who was running a fever last night. (We were worried about the H1N1 but the doctor says it’s just an ear infection.) Everything should go smoothly but I still have a low-level sense of dread that something will go wrong at the last minute. I need to bring a certified check to the closing, but even at this late hour I don’t know the amount because someone (the lender, I think) is dragging their feet. I’m waiting for that critical piece of info so I can ride to the bank, get the check, and then ride on to the title company for the ink-fest. Meanwhile the tension mounts.

At least it is a beautiful day for a bike ride.

Maybe It’s Right to Be Nervous Now

Back in June 2006 we had some extra money lying around from our insurance settlement. I’m hesitant to name dollar amounts publicly. Let’s just say it qualified as “a lot” in my book. More than a month’s salary, less than a year’s. I hope that is sufficiently vague.

So I decided to invest in the stock market.

Ah, you can tell where this is going already, can’t you?

When I wrote about this a couple years ago I got a number of comments from readers, most advising caution. But I decided to keep this money in the market for a few reasons. For one thing, I was getting financial advice from my father, whom I trust. For another, I am already socking away a certain amount each month into safer managed funds. Also, I didn’t put all this cash in the market, only part of it. And finally, I understood the risk. This particular chunk of change was a windfall, money we could theoretically afford to lose. As I said back in June:

Worst case scenario: I lose all this money. Eh, so what. We’ll still be ahead of where we were pre-Katrina.

The system we used worked something like this: We identified stocks that were commanding a good price for options. Then we bought those stocks and sold the options. This is called selling “covered call options.” At the end of each monthly cycle, we generally sold off any stocks that didn’t hit their strike price and start over again.

After about a year or so, I’d done pretty well. My portfolio was up 50%.

Then things started to go downhill. Soon all my profit had evaporated and I began to lose money. I watched with sick fascination as my portfolio dwindled to half my original stake, then a quarter, then a tenth. Somewhere in there I got a margin call and had to sell off some stocks. Did I mention we bought stock on margin?

Then yesterday I got another margin call and was forced to sell off what little stock I had left.

So that money is gone. All of it. In fact, I owe the brokerage house a little.

I’m a bit stunned. I really thought we could ride this out. I thought, if I just hold on long enough, if I just brazen it out, surely we’ll bounce back a bit. Turns out I didn’t have that choice. The daily headlines fret about when the market will “find its bottom,” but it seems I’ve found mine.

It was an interesting ride, but now it’s over. Easy come, easy go, I guess. I was a bit uncomfortable as a capitalist anyway.

It still sucks. But I’m very glad I didn’t have all my eggs in that basket.

As for Dad, he is much more invested in the market than I, so he’s really feeling it. He sends this cheerful comment:

Mom and I don’t have much money left but we can get by until the grim reaper comes along.

He was born at the beginning of the Great Depression, and he says this is the worst financial crisis he’s ever seen.

And I understand the nation of Iceland may well go bankrupt. Things are rough all over.

Assessment

We got our 2009 Real Estate Assessment from City Hall Friday.

Last year, I didn’t understand property assessments, but now I think I do, kinda sorta, so I’m actually able to make some sense of this notice.

Last year, our assessed value was $720 (land) + $1000 (structure) for a total of $1720 — the entirety of which was exempt, being under the $7500 Homestead Exemption. We still paid a smidgen of property tax because we live in Orleans Parish and our firefighter tax is figured without regard to the Homestead Exemption, if I’m recalling correctly. Did I get that right?

This year, our assessed value is $1840 (land) + $15160 (structure) for a total of $17000. That means we now qualify for the full $7500 Homestead Exemption. The taxable total is the remainder, $15280. If we can assume a millage rate of .12920, that means we’d owe $1974 in taxes. Add another $160 for police and fire, and that gets us to $2134.

What confused me about this business in the past is the fact that assessments are 10% of fair market value. So these numbers imply that we’ve gone from an estimated fair market value of only $17,200 to $170,000. Now that I understand how this works, it’s clear that our 2008 assessment was low, way low. I don’t know if that was a Katrina thing or if it’s one of those houses that have been under-assessed for years. Our 2009 assessment is much closer to what I imagine the value of our house might be.

But actually I think it’s a bit high. We only paid $107K for the house. Our renovations have mostly just gotten it back to where it was before the Federal Flood, though the lead remediation was a substantial improvement. I’d love to think we could get $170K for the house. But I’m inclined to think it’s less, probably a few tens of thousands less.

Then again, I’m no expert on real estate. My feelings about the value of the house are pretty subjective. If this really is a fair assessment, we’ll pay it with no more grumbling than most taxpayers. If it’s high I’d like to get it adjusted. But how do I know the difference?

I’m wondering if I should make a trip down to the assessor’s office. I’ve got until August 15th.

Drop Off

I left my daughter with a bunch of strangers this morning. Kind of an odd experience, but not as upsetting as I might have thought. The folks at the daycare seem to know what they’re doing, and the whole scene inspired confidence.

This is teacher prep week, so Xy’s not quite back at work full time yet. She was going to do the drop-off herself, but decided last night that she was too likely to burst into tears. So it fell upon me, as it will regularly once school starts. I strapped her onto my chest and walked the four blocks. Didn’t integrate the bike into the routine yet. It was threatening rain, so I wanted my hands free for the umbrella. Didn’t need it, though.

Daycare is expensive. I’ve rented whole houses for less than we’ll pay per month. It certainly does make one look twice at the possibility of one parent staying home to care for the child. Garvey says he and his wife manage it; coincidentally I read (in Parade of all places) about another couple (from Indiana of all places) who are doing the same thing. In both cases, these folks are making ends meet with substantially less salary and a bigger mortgage and they’re not going into debt.

I don’t know how they do it. We don’t live an extravagant lifestyle. By my calculations, even if we cut out all luxuries — no internet, no Netflix, no alcohol, never eat at a restaurant — it still doesn’t add up to that much. I don’t know what else we could cut.

Anyway, those calculations will have to wait, because we’re committed to our present course for at least the next school year. Xy isn’t the type to welch on an obligation; she’s said she’ll teach this year, and so she shall. That means our daughter will be in the hands of others for a good portion of the day.

And I think she’ll enjoy it. She seems fairly happy and comfortable with strangers, and I suppose there’s some socialization value even at this young age.

But the next month may be a difficult transitional period.

Christopher Elliott Writes About My Case

Thanks to Carol G for getting me in touch with the very helpful Christopher Elliott. He’s the ombudsman for National Geographic Traveler magazine. Today he published my case. I found it in the Arizona Daily Star, though not, strangely enough, in our Times-Picayune which usually carries his column in the Sunday Travel section. I can tell you that $83 was very helpful. Orbitz actually refunded our tax paid as well so we came out ahead on this deal.
Continue reading “Christopher Elliott Writes About My Case”

Vindication

This story in the paper made me feel ever-so-slightly vindicated about our decision to renovate.

A new study of home prices around the New Orleans area shows that buyers rewarded sellers who gambled and rebuilt in devastated areas like Lakeview, eastern New Orleans and Chalmette. Renovated homes in those areas recovered much of their pre-storm value last year, while prices continued to tumble on homes that were gutted but otherwise left untouched.

It’s not that I take any glee in seeing others lose out. Take for instance our next-door neighbor. He hasn’t even gutted his house, two and a half years after the flood. I’m not happy about that, and I hope he can get it together. I wish him well.

I’m just glad to know that we aren’t being punished for having done the right thing. We have no plans to sell our home, but if we did, we wouldn’t take a bath. There’s a little solace in knowing that.

I Got a Golden Letter

We got our “gold letter” from the Road Home today.

The letter states that we did not qualify for any compensation. Or, as they so cleverly phrase it, “your compensation grant was zero.”

This is because they estimate our damage at $34,050.53. Our insurance company paid us $82,294.03. Both these figures are stated in the letter.

Couple interesting things to note:

  1. I think their damage estimate is on the low side. But it does generally bear out my feeling that, unlike so many, our insurance company didn’t screw us.
  2. We did not document our insurance settlement during our initial interview. It’s on my list of documents I need to gather, but I’ve been procrastinating. So they must have contacted our insurer. (Actually I’m not sure of the amount myself, but it sounds about right.) They have it listed as all flood money, but I’m pretty sure that part of that total was from our homeowners policy. A bit odd.

Easy come, easy go. We only applied to the Road Home because Blanco said everyone should. I guess we could appeal their damage estimate, but I doubt we will.

Initial Appointment

Xy and I had our initial appointment with the Road Home program this morning. Yes, that’s right, initial. We’re only just now getting started. For once this tardiness cannot be blamed on governmental ineptitude or bureaucratic bungling. It’s our fault. We’ve dragged out feet and postponed this because we don’t really expect to get any benefit from it. But the governor herself said that everyone who sustained any damage from the big storms of ’05 should apply. So we are.

The process we experienced was almost comical. There were all kinds of beeps and sirens going off. We had to sign in and check in multiple times through multiple checkpoints. They took our thumbprints and mugshots.

Road Home Mugshot

Road Home Mugshot

Road Home Thumbprint

Road Home Thumbprint

We had insurance, which actually paid out a decent amount in a timely fashion. But are we whole yet? It’s hard to say. Our renovation is ongoing, and we haven’t run out of money yet.

As I understand it, since we have an appraisal of our home’s value from when we purchased it in 2002, and since the amount of our insurance payouts is a known quantity, and since our home was less than 50% damaged, there’s only one variable remaining to be computed. Then the award formula can be calculated in a straightforward fashion. The remaining variable is the Road Home’s estimate of the cost of our damage. They will calculate that based on an inspection which should happen soon. If their estimate is higher than our insurance company’s, we should get some funds to make up the difference. If not, we won’t.

So essentially this will function as a check on our insurance adjuster, and it all comes down to the inspection. I’ve heard tales (which may be specious) of people bribing their inspectors with lavish meals to get a favorable evaluation. We won’t be engaging in any such foolishness. I’ve also heard about people getting an unfair evaluation because they couldn’t meet the inspector, but I certainly won’t allow that to happen.