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.

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