Bridgette Sullenger knows what it takes to survive difficult times.
Sullenger is an ordained minister who works with patients in hospice care. Sullenger also leads group counseling sessions for those left behind.
"Every day, I'm around people who are about to die, often holding their hands at their very last breath," said Sullenger, 48. "That's a very powerful time of life. There is no pretending. There are no hidden agendas."
Perhaps that's why her own financial problems haven't overwhelmed her.
"There is a lot in her financial life that just isn't working out for her," said fee-only financial planner Delia Fernandez. "I think anyone else being handed this information might want to burst into tears."
Sullenger is a single mother who was doing pretty well until the recession and the real estate meltdown.
Sullenger played along during the real estate investment boom, buying three Inland Empire houses near what turned out to be the top of the market. She rented out two of the homes.
As the recession took hold, her tenants lost their jobs and couldn't afford the rent. Sullenger wasn't able to find replacement tenants who could pay enough to cover her costs.
In 2009, with about $1 million in debt, Sullenger filed for bankruptcy protection.
Despite her ruined credit, Sullenger is no slouch. For a while, she was working seven days a week to pay the bills. Sullenger's sense of civic duty led to a 2011 campaign for mayor of Palm Springs. She finished second out of seven candidates.
Eventually, Sullenger lost the two rental houses to foreclosure. She paid off her other debts, including her car. She learned how to live on cash.
Sullenger's income last year totaled slightly more than $79,000 from her bereavement services work and a part-time university teaching position focusing on world religions, ethics and communications.
The only debt left these days is the approximately $577,000 mortgage on the three-bedroom Palm Springs home where Sullenger lives with her two children.
The question of paying for college one day is a big worry. Julia, 13, already has a career interest in forensics and has completed award-winning science projects, including one on how to analyze fingerprints.
Her son, Vincent, 11, has an inventive spirit.
"One day he said, 'Mom, it was hot in my room so I made a fan,'" Sullenger said. "He made it with his erector set, some Lego pieces and some batteries."
Even though she works hard, Sullenger is behind on saving for her retirement and her children's futures, said Fernandez, who runs Fernandez Financial Advisory in Los Alamitos.
Sullenger has about $6,900 in two 401(k) retirement amounts, but she needs to increase her contributions to take advantage of matching funds, Fernandez said.
"That's free money," Fernandez said. "Right now, she's leaving it on the table."
Sullenger is setting aside less than 4% of her income toward retirement. "At her age, she should be saving more like 15% to 20%," Fernandez said.
Sullenger's biggest disappointment was her home's value, which could have ranged from $480,000 to $598,000, based on nearby home sales. Fernandez consulted with experts who valued the house at about $500,000, or about $77,000 less than the mortgage.
Sullenger isn't alone in her predicament. Nearly 20% of Inland Empire homes with mortgages are underwater, which means the houses wouldn't sell for enough money to pay off the loans.
"The housing crisis is not over," Fernandez said. "Some people like Bridgette haven't healed from the downturn and are still stuck in a very uncomfortable situation."
Moreover, Sullenger's story provides a lesson on what it really costs to own a home.
"People need to remember that they have to set aside money for maintenance, repairs," Fernandez said.
"The home will need a new coat of paint someday," Fernandez said. "The roof will need to be fixed. There will be termite damage. When you are thinking about whether or not you can really afford a particular home, those kinds of costs have to be budgeted for."
Sullenger found the valuation of her house discouraging.
"Do I short sell?" Sullenger asked. "Do I rent it out for a few years and go rent somewhere else? Do I sell and take the difference in a loan? Is that even possible? Do I cry now?"
In real estate, a short sale is a transaction in which the lender agrees to accept a payoff for less than what is actually owed.
There are other problems with the home. Before the bankruptcy, Sullenger got a loan modification as part of the government's Home Affordable Refinance Program, which reduced her interest rate to 2%.
But the rate will jump to 5% in 2017. That means her monthly payment will increase from a current $1,729 a month to $2,210 in 2017.
In addition, more than $74,000 of her mortgage was deferred, but she will have to pay that back. If Sullenger's lender agrees to a short sale, the deferred portion of her mortgage would be eliminated.
"For her, it was more of a Home Temporarily Affordable Refinance Program," Fernandez said.
One of Sullenger's best options might be a short sale of her home, Fernandez said. Refinancing is not an option because she is unlikely to qualify so soon after emerging from bankruptcy just last year, Fernandez said.
"I hate to see her drag around a house that is underwater," Fernandez said, "when she has already paid the price of a bankruptcy and she's trying to support a family."
Another option, Fernandez said, would be for Sullenger to find a cheaper place to live and rent out her house for more than want she owes each month.
"I want to see her saving more for her retirement and for her kids' education," Fernandez said.
Fernandez praised Sullenger's ability to stay away from credit card debt, but added that she needs to pay closer attention to her spending to know if she's making the best use of her money. A good way to do this is to write down everything she spends for a month, no matter how small the purchase.
Fernandez advised a series of fundamental financial moves.
With the cash freed up through more conscientious budgeting, Sullenger needs to start an emergency fund with a goal of building three months' worth of expenses, she said.
She also should stop keeping her cash in a single checking account.
Instead, she should set up a savings account to hold her emergency fund at a credit union or online bank, which tend to pay the best rates. It should be separate from the account Sullenger uses to pay bills, Fernandez said, because "otherwise it's too easy for the money to just come in and go right back out."
If Sullenger decides to stay in the house and hope for a value increase, she needs a third account in which she would set aside money for home repairs.
"That's going to eat away at her ability to save for her retirement and for her children," Fernandez said.
For her part, Sullenger said she is willing to consider getting out of her home.
"As difficult as this was to hear, I feel like I know what I have to do now," Sullenger said.
Who: Bridgette Sullenger, 48
2013 income: $79,315
Goals: Continue to live without credit cards. Pay more attention to where her money goes in order to spend more efficiently. Build up retirement accounts and savings to pay for college educations. Decide what is best to do with a house that is worth less than the mortgage.
Recommendations: Consider a "short sale" of her house, if the lender will agree to take less money than she owes on the mortgage. Alternately, consider renting the home and living somewhere else more cheaply. Pay closer attention to her spending. Build an emergency fund. Stop putting all of her cash into a single checking account; open a savings account for the emergency fund and use another account for day-to-day expenses. Put more money into her 401(k) retirement accounts to take advantage of matching funds. Start to save for college.
About the advisor: Delia Fernandez is a fee-only financial planner who runs Fernandez Financial Advisory in Los Alamitos.
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