The Winner of the September 2015 Call to Action!

The Winner of the September 2015 Call to Action!

Woman smilingSome surprises can brighten your day, like getting flowers at the office. Some can be life-changing, like learning that your long-lost aunt left you a windfall.

But others aren't quite so nice, like pretty much any surprise that pops up while trying to purchase a home.

In an effort to pool any hard-learned lessons from home buyers, we posed our September Call to Action: What part of the home-buying process caught you—and your finances—by surprise?

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The responses we received suggest that some readers are still recovering from the financial (and emotional) frustrations they confronted—from a woman who was locked out of her bedroom to folks thrown off by maintenance or insurance costs. 

Thanks to everyone who shared!

And congratulations to this month’s winner, who will receive $100 to help her achieve her financial goals: Christine Tarlecki, a copywriter from Philadelphia.

While buying a home is one of the best things Christine says she's ever done, she faced an unexpected cost as she prepared to close—and an even bigger surprise years later when she realized she was still paying up unnecessarily.

Here's her story.

"I had always wanted to buy a place of my own by the time I was 25, and thanks to extensive research and careful planning, I did just that!

I started saving money while living at home after college and writing freelance articles for magazines. I saw too many friends who rented lousy places or super-expensive apartments while on just-starting-out salaries, and I didn't want to do that.

Instead, after a few years of preparing, I bought a three-bedroom condo for $81K in an area that is now exploding—a suburb outside of Philadelphia. It’s quiet, and not too far from work or my parents or grandparents. The home, which has gone through several renovations, is a great livable space. Bonus: there's a pool!

But it did also come with some headaches. The thing that caught me most by surprise was the private mortgage insurance I had to pay. I was told my mortgage was going to be a few hundred dollars—and it is—but the PMI added $75 a month.

There was no way around it, so I just tacked on that added expense to my mortgage payment each month.

Out of sight, out of mind, right?

Well, that approach didn't work out so well in this case.

It was 10 years later, when I was considering refinancing my mortgage, that I found out I had long been qualified to have the PMI removed.

And it only came to light because when I looked over the financial documents the bank sent back to me, I noticed that the PMI was still listed. I asked the bank agents whether I still needed to be paying that fee, and they confirmed that I didn't.

Shocked, I asked whether anyone was actually going to tell me I didn’t need to have that $75 a month on my mortgage anymore. The answer? No.

After about 10 years of being in the dark and shelling out $2,000which could have been going straight to my mortgage paymentsI finally put an end to it.

The process was simple: I requested to have the PMI removed, signed a form, and had it put into effect.

After my experience, I'd suggest other homeowners who have PMI check with their mortgage lender to see what can be done. Some PMIs can be dropped after the loan-to-home-value ratio reaches 80%; others are permanent for the life of the loan.

I'm now putting an extra $50 a month toward the mortgage principle, and it’s so satisfying to see that final number dropping!

I owe less than half my mortgage in less than half the life of the loan and am working to accelerate that goal and pay off my mortgage completely."

Thanks for sharing, Christine!

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