As we have been dispossessing ourselves of our accumulates stuff, Lora and I have been making preparations for life without a fixed address. The first step was the sale of our fixed address and purchasing our travel trailer. We had a smaller trailer already, sorta, that we had purchased at the RV show in Boise.
There is a story associated with that purchase that goes all the way back to the sale of our home in Lombard some years ago. To make it brief and to the point, with a change in presidential leadership at the college where I worked, I had lost my cabinet level job at the same time that our house went under water figuratively, due to the financial crises, and literally, due to inadequate infrastructure and heavy rains. I secured another job in Salt Lake, but we had to sell our home, and that proved impossible, not only because we were under water, but also because we held a split mortgage on the home. One bank held the primary mortgage while another held a secondary mortgage that had financed an improvement to the property. When outright sale failed predictably because we had disclosed the flooding, we went into short sale. When the short sale failed, predictably, because no one could get financing, we went into foreclosure. The property eventually sold for about a quarter of what we had originally financed. The primary mortgage was released with the foreclosure, and so was the secondary, but the secondary mortgage holder never removed it from its books and showed it as an unpaid debt, which in turn showed up as a big blotch on our otherwise flawless credit report.
OK, with that in mind, back to the story line. We had gone to the Boise RV show with the intent of buying a "camper," an RV to be used on short duration fishing trips. We had a price range in mind, and we looked at every RV in that price range at the show, which turns out to be a surprisingly large number of options. We settled on a trailer by Jayco, and sat down with the sales rep to fill out the financing paper work. Although we had bought and sold and bought homes in the interim, we weren't surprised when the secondary mortgage popped up on the credit report. The finance manager at the dealership asked for paperwork showing that the debt was included in the foreclosure. We provided that paperwork, and in a few days we heard back that the financing institution wanted proof that the debt had been cleared. That, we couldn't provide, told the finance manager so, and we didn't hear back from him. Oh well, we thought, it was a good idea, but it just wasn't meant to be.
In the meantime, too, our plans had changed. The corporate offices at Office Max had come to the decision that the Boise legal office was disposable, and our son who worked with the legal team as a computer forensics specialist, found himself without a job, sorta. He had an option of taking a "buy out" or relocating to Boca Raton in Florida. He chose the latter for any number of reasons, but it had a devastating effect on our lives. Their move to Boca Raton meant the loss of our grand-daughter, sorta. We had been a part of her day to day life since she was born and our son, separating from the AF with his new and pregnant wife, had lived with us in the Lombard house -- a house, I might add, that was not only a blotch on our credit, but filled with memories of our grand-daughter as she emerged from infancy into her toddler years. She would, for the first time, be two thousand miles away, and we would not be an active participant in all those milestones -- first boy friend, her successes at school, her prom graduation. As a consequence, we decided, new plan. Instead of weekend camping, we would sell the house in Mountain Home, use the proceeds to pay cash for a larger RV, and go full time.
The day to pick up our small camper came, and when we didn't show up, we received a phone call wondering why. Well, we said, when we didn't hear back from you, at all, either positively to say our credit had been approved, or negatively to say it hadn't been approved, we simply assumed it was a dead deal. Apparently not, surprise! and we were the proud owners of a small trailer sorta, that we no longer wanted. In reality, what we owned was the debt. The trailer was now an inconvenience to the dealer, because they no longer owned it. Because Idaho law does not allow for a "cooling off" period on RV sales, the moment we signed the credit application, we were subject to an asymmetry. They could turn us down -- and we thought they had -- but we could no longer turn them down. We were obligated to make the payments whether we picked up the trailer or not. So, we picked it up, brought it to Mountain Home, and parked it in the lot at Terry's
In the meantime, then, we followed through on our new plans. We dispossessed ourselves of our household stuff, and then finally our house two days ago last Friday. Good riddance, and we have found a way to make the small trailer "inconveniently handy" as we wait on what will be our more permanent home. We have already put money down on a larger trailer -- $1,000 non-refundable.
More on the particular trailer later, after we have inhabited it and I am clearer on the differences between our thinking and the reality, but there were a couple of things that struck me about the purchase itself.
First, of course, is the immediate loss of value on the smaller trailer. We more or less expected it, but not the extent to which it lost value -- a little over $5000. It has nothing whatsoever to do with "depreciation" or "use." With a little cleaning -- very little -- it will be indistinguishable from new. We haven't even used the stove. It cannot be sold as "new," because it has been registered and a title search will show our ownership, but I doubt very much that the dealership will discount the price on this trailer much for the wear and tear of use. The $5000 represents, of course, their profit margin on the resale. We could have sold it ourselves and come closer to what we owed, but that would have added another layer of uncertainty to our new life, not to mention the complications of paying off the loan, waiting on the title, waiting on a buyer, and what for us is the unpleasant act of negotiating the sale itself. Neither Lora nor I have the necessary self-interest to be good sales people.
As I said, though, we more or less expected that loss. Perhaps more surprising was the penalty that we paid for negotiating a cash purchase. There was a delay between the closing on the house and the actual purchase -- hence the $1000 non-refundable deposit -- but once closed, there would be little need to finance the purchase. Both Lora and I want to be debt free as much as possible, and there are reasons, both philosophical and practical, for being neither a lender nor a borrow. I could explain in excruciating detail, but will spare you. Still, though, clearly we are swimming up stream, actually more up a river during spring run off. The dealership didn't want to sell us a trailer. They REALLY wanted to sell us a loan, and the trailer was just a pretext for the sale of a loan. I suspect that, if we traced it back one step, we would find that the dealership doesn't "own" the trailer outright either, but has financed their inventory. If we traced it back another step, we would find that the manufacturer doesn't "own" the means or materials of production outright either, nor do the ancillary manufacturers that provide them with components, so on and so forth, in a web of "interest" more complex than Indira's web. I wonder, in other words, how much cost of the physical trailer is simply empty, "interest payment" piled on "interest payment" piled on "interest payment," and in being a good consumer and buying the trailer, ultimately, we're paying it all or at least that slice associated with this trailer.
And the dealership wanted more. If we financed, we were told, we could avoid a $2000 surcharge. The sales person was adept at telling us how we could "cheat" -- his word, not mine -- by taking out the loan, then paying it off after six months. In the meantime, though, we would be making "interest payments," and though he didn't say, the "pay it off in six months," was a truthful evasion. If we paid it off sooner, I suspect there would be a clause in the very fine print imposing a penalty for early payment and that penalty would probably be somewhere in the neighborhood of $2000. If we dutifully made the payments for six months and then paid it off, as suggested, I suspect that the interest collected during that period would be somewhere in the neighborhood of $2000. I don't know if they would have insisted on that surcharge had Lora and I been willing to walk away from the deal -- that is, if we had been better negotiators -- but those of us who are now "old timers" remember a day when there was a discount for a cash purchase. It meant, of course, that one was "thrifty," that one was "living within one's means," that one was "independent" and not "beholden to creditors," all of which are American virtues running all the way back to the likes of the Puritans who saw participation in usury as a sin against nature and nature's god, indicative of greed and an inducement to sloth. Not so much nowadays. We are, it seems, inescapably financed to the hilt.
Oh well, tomorrow we pick up the larger trailer, and we will pay cash to include the $5000 difference on our current "trade in" and the $2000 surcharge, and we will own it "free and clear" (except of course for taxes and registration fees). I do feel a bit cheated, and a bit resigned to the idea of being cheated, but also anxious to hit the road with Jack and Thor (our two Chihuahua dogs).
TIMELINE: cool at 42 degrees. Reading, Henry A. Giroux, America at War with Itself. Cubs lost to the Yankees 5 to 4 in 18 innings of play -- heavy sigh. Good news, Marine le Pen lost the presidential race in France, which the Times calls "an important demonstration that reason and coherence still matter in politics."
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