Personal & Financial Disaster Are My Friends – MassJollyGreen

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MassJollyGreen
Personal Financial Disaster Are My Friends MassJollyGreen


The last two years have been nothing short of a disaster. Personal and financial turmoil are my close friends. I try to remove myself from the turmoil rut, but another day brings another issue. Issues can range from my checking and saving accounts being low, and a bill is due today. In the past bills did not worry me, and I viewed payment as my civic duty. When you have money, you have no issue with meeting your financial engagements. Today I see creditors as the scum of the earth. Thanks to the creditor for giving me a bunch of unsecured credit you knew I could not manage to pay. Remember on the application when I filled in the salary section? Yeah, the one you saw and then gave me this ridiculous spending limit. Also special thanks to the creditor for making the interest rate high enough so we can have this payment arrangement relationship into infinity. I should even blame myself because I decided to obtain and use these credit cards. I usually use credit only in financially tight times. Lately, every day seems to be a financially tight one.

As you begin to own more things of higher value, the costs to maintain these things are ever-increasing. Now I am getting punished for investing in my future. I own an investment property that has tried to bleed every dollar from my pocket. Bleeding every dollar is an understatement. The property has single-handedly bankrupted me both financially and emotionally.

What started as a property to renovate and resell has turned into a nightmare. The flipping process taught me contracts do not matter. Long story short, we found a contractor to renovate the home we purchased. We were able to finance the house in under 30 days for both purchase and renovation through a hard money loan. The contractor began working on the home, and it was one setback after the other. First, the contractor wasted about two to four weeks to obtain permits. Once permits were obtained, the contractor noticed more issues with the home. Some of the problems were frivolous and some serious, but all in all the costs for the project were ever-increasing. We then noticed the contractor spent more time asking for additional funds than working on the project. I got burned, and I have tons of knowledge about construction. Learn from my mistakes when picking a contractor do your due diligence:

  • Do not choose the lowest quote: This was our mistake. Sometimes a contractor may underbid a job. The contractor knows if they are in the middle of the job, you are more opt to agree to a change-order and increase the contract price.
  • Licensed & Insured: Always make sure your contractor is licensed and insured. Yes, a contractor who is not licensed or insured may be cheaper. You should consider the long term effects if there is faulty work. You will now have to redo work you have paid for already. An unlicensed worker has no real incentive to “make it right.”
  • How long has the contractor been in business: This was another of our huge blunders. Our chosen contractor was in business for under a year. You want to work with a contractor who has been in the game for several years. You can check references, etc.
  • Work inspections: You should have planned inspections with the contractor. Make surprise unannounced visits to keep the contractor honest. You should check the condition of work and determine if the contractor will meet both time and financial goals. Do not trust the contractor and walk-away. Would you give someone a lump sum of money and walk away?

Here’s why the setbacks pissed me off the most. First, we spend countless days and hours finalizing the scope of work. Second, we spent weeks working on the pricing of the project. Within a couple of weeks, all of the negotiations flew out the window. The contractor walked through the home on numerous occasions, but as work began, everything’s wrong, and the proposal needs to be revisited. Now the contractor can dictate progress. The contractor can stop work until they receive payment.

The hugest lesson I learned from the renovation project is fire early and often. So what the contractor will be upset or you do not want to be confrontational. Severing a negative relationship in its infancy will save you a ton of money, in the end, trust me. As the contractor made mistakes, I came home and vented instead of communicating with the contractor. A lot of the niceties stemmed from a previous personal relationship with the contractor. Another life lesson you can have a friendship or a negative account balance the choice is yours. I chose the latter and waited until I could not deal with the contractor anymore. When I could not deal with the contractor anymore, and my banking accounts were looking weak now, I decided to freak out and fire the contractor.

In the end, the contractor filed a lawsuit against us. Who knew you could create a frivolous lawsuit and get paid because the defendant is tired of getting whacked by legal fees. When going to court and being represented by an attorney, you have to remove all emotion. No matter how pissed or upset, you create a goal and stick with it. I made the common mistake of leading with emotions. Always remember emotions cost money. How much are your feelings worth to you? Remove the feelings and move with a sane mind, or entrust someone else for your emotional checks and balances. Here’s a hint the average attorney costs around $275 an hour, so it’s cheaper to share your emotions with a therapist.

Even though we had a contract with the contractor, it seemed like the court never considered the document. Here’s another lesson learned when communicating with a contractor pick one communication avenue. I would highly recommend the mode being email. The contractor can notify via email so that you can keep a chain of the communications. If the contractor refuses to communicate via your accepted mode, ignore them, and reply from your accepted method. You’re in charge and dictate your project, not the contractor. After all who’s paying for this you or the contractor? Now you can see why I’ve delved into this personal and emotional rut.



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