Real Estate Investing

Remember my friend Mary?  Desperate to save her house, she’s been applying and interviewing for jobs.  Today she was offered one at a hospital in her town paying $10.50 per hour.  Overall, much better than minimum wage and she thought it would possibly be just enough to make a house payment.However, as Mary crunched numbers, they just didn’t add up.  She would be able to keep WIC, but not other food assistance.  She would have to pay $150 every week in child care.  And to make matters worse, because insurance was available at the new job, she would lose the state healthcare coverage for her children (ages 1 and 7).   The cost of insuring her family through her potential new job?  About $500 a month.Mary’s take home pay would be $60 a week - or $240 a month.  Not enough to make her house payment.  Not enough to pay utilities.  Not enough to pay for gas to get to work and daycare.  Maybe enough to feed a family of four.  Not enough to accept the job.Meanwhile, the company holding her mortgage has definitely started the foreclosure process.I don’t know how to comfort Mary.  But writer Jamie K. Wilson tells how to survive poverty.  Another friend of mine said she did this, too:

In the short term, sell plasma. This is for filling in those financial gaps - getting gas when you absolutely have to have it, paying for the kids’ medicine, or buying groceries when you’re in a crunch.

Meanwhile, there are some very good tips out there on how to survive a financial meltdown.  Bankrate tells people to not panic and outlines some steps people should take when facing a financial crisis.Geraldetta Lovelace has survived three foreclosures, “Foreclosure put our credit in the tank which made it hard to find a place to rent. We have learned to be up front about our situation instead if being ashamed and quiet. There are so many people in our situation and worse that need help.”I found an ABC News story from December about how more tent cities are springing up - fueled by people who’ve lost their homes.  Squatting in empty houses is also becoming an option for people.I am wondering aloud whether Mary should consider a short sale of her home to get out from under it, take a deep breath, and move in with her mother-in-law for a year or so while they get back on their feet.  Charles Tharp, a Realtor from California, shares his experiences with foreclosure but is optimistic,

If you can’t refinance or your lender won’t negotiate the terms of your loan for a forbearance, modification of the terms of your loan, etc. (see my blog, “General Options to Avoid Foreclosure“) then the only way to get out of this situation may be to sell your home. If you can sell it before it is foreclosed upon then you can get back on track within a few years.

Mary will experience many difficulties before her finances heal.  I am saddened that she’s ready, willing and able to work, but can’t because there’s not a grace period for the public assistance she receives.  Mary has a long road in front of her that she and her family will walk.  I don’t know how to fix things for her.  All I can do is be there for my friend as she takes her steps and starts putting the miles behind her.