In December, 1994, we signed the loan papers to buy our house. It had been a bumpy road to get that loan. When I’d called our bank, the loan officer there had asked a few screening questions. Yes, we had steady jobs. No, we weren’t deep in debt. I hit a brick wall when he asked the amount of my husband’s and my combined income. I told him the number, and he said, “No, I mean combined income, what you two make together.” I answered, “That IS our combined income.” There was a short silence, and then the banker came back with, “Oh. Well, then, I’m sorry, but we can’t help you.” I got the same answer from the other banks I tried. At that time, I was working as an administrative assistant in a hotel (hotels are notorious for low salaries), and my husband Rick was working as a trash compactor repairman at a tiny family business. In the end, Rick’s grandmother helped with the down payment, our realtor helped us get a 30-year loan through FHA, and we signed up with a mortgage company. Interest rates then were astronomical compared with today’s rates, and we were slated to end up paying the mortgage company more than three times the price of the house over the life of the loan. It was a daunting number when we put our signatures on half a ream of paperwork. As it turned out, after we refinanced three times, we made the final payment less than 18 years from that first signature. And our house was very modestly priced. In fact, at one point when I worked for a big accounting firm, and my salary was a bit better, we ended up owing a small amount at tax time. When I consulted with one of the federal tax guys, he told me that we should have “more house, more debt, and more expenses,” considering our incomes. In other words, we were living too much within our means, according to how the tax codes are calculated, the tax guy said. We just shook our heads, because, considering that we still didn’t make very much money, what else could we do except live frugally? So we reduced our exemptions to zero, and had extra tax money taken out of our wages.
But to go back to that first loan, without the help from Rick’s family, it would simply have been impossible for us to have saved enough for the down payment that was required in those days. We might not ever have been able to buy a house unless both of us had taken on additional part-time jobs. And yet, within a decade after we moved in, the housing bubble was in full swing, and people with our salaries were buying McMansions. It wasn’t unusual for their mortgage payments to be so high, they couldn’t afford furniture, but they could still live in homes with many times the square footage we had, in much more upscale communities. No down payments necessary, and low, low, low initial interest rates, a fraction of our starting rate. However, as we saw in 2008 and thereafter, the bottom dropped out of the market, and thousands upon thousands of those homeowners who’d bought enormous houses on blue-collar salaries ended up in dire straits. Our county, in fact, had one of the highest foreclosure rates in the nation. When once Rick and I had been too poor to even get a loan, we ended up being in a stable situation, paying off our small house in our run-down, not-yet-gentrified neighborhood a couple miles outside the city center. Countless others didn’t fare as well; they were now “too poor” to afford the houses they’d bought, and had to manage any way they could, often selling at huge losses and ending up deep in debt.
Over the years, our combined salaries inched up, but never got within shouting distance of the six-figure range. We stayed in our house and spent years rehabbing and refurbishing, doing almost all of the work ourselves — it had needed an enormous amount of TLC when we’d moved in. We’ve estimated that we’ve put considerably more back into the house than we paid for it. We still watched our money. We never bought new cars, for instance, or much in the way of toys. When one 14- or 15-year-old van would give up the ghost, we’d quietly pay cash for a “new” 10-year-old model. Our small, used motorhome has been our one indulgence, but we didn’t go into debt over it.
Fast forward to the present day. In a sense, we’re almost back in the same situation as we were when we bought the house. I lost my job in 2019 and couldn’t land another one, so I had to file for Social Security last year at 62, making me officially retired, but of course, I don’t have the benefit of Medicare. Rick doesn’t get healthcare insurance through his job, so we had to turn to the ACA to get insurance. Incidentally, I’ve yet to encounter anyone in healthcare administration who knows what the ACA is. I keep having to explain that it’s otherwise known as Obamacare or insurance through the healthcare marketplace. But I digress. This insurance is more expensive than my employer-provided insurance was, and covers MUCH less, with an exorbitant deductible. “Affordable care”? NOT!
Because Rick is finally, after 10 years with his current employer, making a decent wage for a local truck driver, we’re managing to survive so far without too many cutbacks. We won’t be taking a cruise or destination vacation anytime soon, but we’re still afloat. Paying off the house in 2012 is what has saved us. Having a mortgage payment would make things dicey, for sure. Again, we’re not profligate: I have a 401(k) to call on in a few years, and we have a tiny savings account, but as Rick has no pension or other plan through his job, we’re not exactly going to be rolling in dough when he retires.
Enter my cataract surgeries. The insurance we have will pay 60% of charges, after that huge deductible and a high out-of-pocket cap. As we can’t just ante up $10K out of petty cash, I applied for a discount with the hospital system. After duly submitting a stack of paperwork — although none, surprisingly, to document our monthly expenses — I was turned down. When I questioned that decision, I was told that our income is too high. I expressed disbelief that our combined income, limited as it is again, is too much to qualify for any assistance. At one point, I asked how bad our situation would have to be before we’d be accepted (actually, “begging in the street,” was the phrase I used, then apologized) and I got the vague answer that if our income dropped, or we could no longer get insurance, then we could re-apply. I realize that the charges I’m looking at are a tiny fraction of those that many other people must face, but to me, that’s a big chunk of change, and as someone who hates debt with a passion, I’m uneasy about all of this, even though I would assume I’ll be able to work out a payment system with the hospital, and everything will be OK in the end.
I’ve told this tale, with all the personal information, by way of illustrating what I see as an invisible segment of our population. Politicians and pundits continually talk about the poor, and there are indeed some, though certainly not enough, measures in place to aid those who are truly poverty stricken. But the paycheck-to-paycheck people who work hard and make ends meet, albeit barely, are overlooked. Bernie Sanders has tried to implement policies that would help those who are “one broken water heater” away from not paying the bills, but not much assistance has been forthcoming thus far. Fortunately, people with families are faring a little better these days due to the new monthly allowance for children, but there are still untold numbers of Americans who can’t afford any extra expenses, but who nevertheless fall just above an arbitrary line that disqualifies them for one program or another. It’s a bizarre instance of too much being not enough. The government and the institutions are effectively saying, “Be glad you aren’t homeless or eating mac ‘n’ cheese every night. Be grateful you can keep the lights on.” And, of course, those of us in this boat are grateful, but we also know that we have no safety net in our current status. If we get to the point that we can’t meet expenses and we ARE destitute, then there will be more remedies available. Otherwise, we’re continually walking a tightrope, and the people in charge take no notice.