MONEY house hunt

‘I Have $1 Million and I Couldn’t Get a Mortgage:’ A Buyer’s Story

Lynda Pratscher bought this two-bedroom condo for $138,500.

Despite her more-than-$1 million investment portfolio, Lynda Pratscher couldn’t qualify for a loan because she wasn’t earning income.

Lynda Pratscher, retired telecommunications project manager, downsized from her $315,000 four-bedroom home Middleton, WI to a $138,500 two-bedroom condo in Wheaton, IL. This is the story of her House Hunt.

She was ready to sell but wasn’t sure where she wanted to end up.

I’ve been a single parent for 15 years or so, and my oldest son was off to college. A four-bedroom, three-car garage home in Middleton, WI was just way too big for me and my younger son and way too much for me to maintain by myself.

I was hesitant because the market hadn’t completely come back yet. I was lucky because I bought in 2002 and the home was worth about $50,000 more than what I paid for it. I sold it in 2012 and decided to rent for a while until I decided what I wanted to do. We went out to Las Vegas and tried that out. We stayed for a year and then moved to Illinois, where we were originally from, in Aurora, just outside Chicago.

After a while she started looking for condos, but saw they were selling fast.

I liked Aurora, but I wanted to go back to college and take classes. I didn’t want the congestion of a big university town though, and I don’t want to live near Animal House. I started looking at towns near the College of DuPage in Glen Ellyn, IL. They have a fitness center, classes, events. I figured, I could build my social life around that.

In February I started contacting agents and looking on all the websites. I set up custom searches and got email updates from agents about new listings. I found a beautifully landscaped condo complex near a lake and started watching for that. When a condo there came up, I contacted the realtor and it was already under contract.

Related: What mortgage is right for you?

At first, she wanted a mortgage. She didn’t want to use all her free cash for a home purchase.

I had quit my job in February, knowing I could live off my savings. I will be 63 in July but I wanted to wait to take Social Security if I could. I have $1.1 million in investments, plus the money from the house sale in a CD. I went to my credit union, and they wouldn’t give me a mortgage because I didn’t have an actual income. They wouldn’t even look at my investments! To them, I had no income. It just sounds crazy.

Then her perfect condo showed up.

I saw a condo on a realtor’s email list and it had everything I wanted. It was on the first floor. It had a one-car garage. It had laundry inside the unit. My agent called me the next morning at 6 a.m. and said, ‘We have an appointment at noon, are you OK with that?’

I walked in and loved the place right away. It was very well cared for and the bathrooms had just been updated. I knew I wanted to put in a bid. She said, ‘I think this thing is going to go very fast.’

The list price was $139,000 and I bid $135,000 cash. They dropped the price by $500, but my agent told me two other people came to see the place after me. I accepted the counteroffer. I didn’t want to lose it. Later, their lawyer told my lawyer they had a backup bid for substantially more than the asking price. I got a great deal.

It turned out that paying cash saved her some money.

Closing was so easy, and the original estimate on my closing costs was $3,000. I ended up paying only around $2,000. I had no idea how much it was worth to pay cash.

House Hunt is an occasional series about buying a new home. Have an interesting story to tell? Email us at realestate@moneymail.com.

Tap to read full story

Your browser is out of date. Please update your browser at http://update.microsoft.com


YOU BROKE MONEY.COM!

Dear MONEY Reader,

As a regular visitor to MONEY.com, we are sure you enjoy all the great journalism created by our editors and reporters. Great journalism has great value, and it costs money to make it. One of the main ways we cover our costs is through advertising.

The use of software that blocks ads limits our ability to provide you with the journalism you enjoy. Consider turning your Ad Blocker off so that we can continue to provide the world class journalism you have become accustomed to.

The MONEY Team