A Precarious Time

Trey Smith

For the first time since purchasing our house in August 2007, I failed to make the mandatory monthly payment. Our grace period for the December payment ended at 11:59:59 pm yesterday and so we technically are now in default. It would not be that big of a deal if we caught up this month by paying the December and January payments, but that will not happen. I plan to make no more mortgage payments which means, ultimately, that our home will go into foreclosure.

The interesting part is that we are doing this on purpose. For months we proactively have tried to address our worsening financial situation in terms of our home ownership with USDA, but we have been steadily rebuffed because we are not in default. As long as we kept up our payments, USDA had no meaningful solutions to offer.

Having read the USDA's regulatory handbook, I found several strategies that we could explore. Yet, each time I asked to explore one, the answer was the same: "We can't initiate that until you are in default." Consequently, we decided that the only rational thing we could do was to quit making our payments so we could enter default status.

It's not that we didn't have the requisite funds to make the December payment -- we did (barely). We might have been able to squeeze out the January payment too. But what's the point in bottoming out our account if we can't make the payments for February and beyond? Losing your home and then having no money to move somewhere else doesn't make a lot of sense!

While Della sets off in about 1 week to begin her/our new life as part of AmeriCorps, I will be left sitting here alone in a defaulted house living off of our dwindling checking account and my monthly SSI. I will utilize this time to rid ourselves of the majority of our belongings and cleaning up the property. I will also get to deal with USDA as they initiate the foreclosure proceedings. What fun!!  (I can hardly wait.)

I don't have any idea how long I will remain here. I don't know how long it will be before I am given an order to vacate. I suspect it will be a few months, but I really don't know. The new year launches a very precarious time for us.