Budget: Extreme Makeover

I’ve been crunching numbers non-stop lately.

It started when my tenant gave notice that he’d be leaving at the end of this month. Quick to Craigslist. What’s the going rate for a 1-bedroom apartment in Lower Pac Heights? I’ve been renting my place for more than two years, steadily increasing the rent with each new lease. But this time, I aimed a lot higher. The rental market is dot-com hot. I’ve got Googlers, engineers, doctors, interns, VCs emailing and calling. A New Yorker hired at Facebook told me he was contending with crowds of applicants at every open house. Bejesus! Instead of 20%, I should have increased the rent by 30%. I still would have had the demand.

With the rental money covering my mortgage, HOAs, and property taxes combined, I don’t want to be one of those un-disciplined Americans who takes that extra money and spends it. Like when we get raises, we adjust our lifestyle accordingly. No, I want to be fiscally conservative.

More research! Even before the tenant changeover, I have been eyeing mortgage rates, targeting a 4% or lower 30-year rate. Then a friend tipped me off to consider a 15-year. THANKS KITTY! I couldn’t seem to make the numbers work, but I kept on it. Determined to cash in on these low rates, I searched all the major banks’ websites for mortgage rates. I scoured the web. I looked at ING and First Republic. I called Residential Finance Corporation because they had mailed me a promotion. And lastly, I checked Navy Federal Credit Union who I used to refinance my private student loan. There it was, a 3.125% 15-year mortgage rate – right on the money.

A little bit of luck, ample social networking, friendship, a lot of research, and persistence. It pays.

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