Keep that emergency fund!

jenuine · October 2011

I know it's been said time and time again here, but we are proof that you should not spend every penny you have on your new home.

Some of you might remember that we had to bring money to the underwater home we sold. We then put 20% down on our new home. Thankfully, we had a good cushion in our e-fund because our roof sprung a leak (several actually) our first night in the house despite 3 home inspections because of Hurricane Irene. $8K and 200 sq ft of rotten roof board later, we are safe and dry.

So please save some money and don't spend it on new furniture if you are tapped for an e-fund!

MAMAxB · October 2011

amen

stephm0188 · October 2011

DITTO.

Within the first few days, water from our master bath started leaking through the family room ceiling. A week after closing, a major hailstorm rolled through and caused 25K in damage.

MNVegas · October 2011

Great advice!

EMWindy · October 2011

Yes!

It absolutely kills me when I hear about people buying homes with 3.5% or 0% down, plus no savings left after that. They are automatically upside-down (that 3.5% down covers only 1/2 the realtor fee if it was re-sold). Not to mention that repairs are inevitable in home-owner-ship - things happen, and that's all part of owning a home.

Sisugal · October 2011

You are singing my song. Sorry, you had to replace your roof - but thanks for sharing your experience. You NEED an emergency fund !

Tweetysvoice · October 2011

oh wow!! Glad you had the fund and thanks for sharing! We have both an emergency fund as well as 6 months worth of mortgage payments set back for just those types of instances! It's already going to be hard to getting used to making payments that are twice what we make now (yes, we can afford it easily), but knowing that we have that extra money set back is such a peace of mind.

I too can't believe that people run out and put down all their savings on a downpayment. We made sure that we had way more than we needed before even starting the process because it's so much more expensive to maintain a house!

curlylocks3 · October 2011

I'm sorry those things have happened but I'm glad you had the money for them.

feb · October 2011

Great advice!!! I'm sorry you had to go through this. But great that you were able to handle it ok! Hopefully this is the last of the emergencies:)

whit8960 · October 2011

This is really good advice and reinforces what I've been telling DH. I know that I will feel much more comfortable purchasing a home with a large emergency fund!

Rachael07.07.07 · October 2011

Absolutely!

I'll add my two cents too. We purchased our home in May of 2010 and it was a foreclosure that we needed to renovate before we could even move in (and I'm not talking cosmetic items - major, down-to-studs renovations). 3 weeks after we closed, my company went under and I lost my job. We had enough in savings for all the closing costs, down payment, renovations AND still had an e-fund that got us through my 10 months of unemployment. Sure we cut down to more budget friendly renovating options but you cannot buy a house without having an e-fund. That is way too risky.

ETA: and the house we purchased was priced much below what we were approved for. There was no way we were going to stretch ourselves. We bought it with the intention of being able to afford it on one salary - and we had to for a long time.

Keep that emergency fund!

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