It was a tremendous opportunity.
The first pass over the numbers was exciting. In theory we’d be increasing our net worth considerably, lots more equity the moment we signed the papers.
When we looked at the property it was just the sort of thing Gorgeous and I’d been talking about. And in the right location too.
We’d already been talking about refinancing anyway, so why not just pull some of the equity out of our house, use it as a down payment on this good deal? Then we could rent our our current house and we’d come out way ahead at the end of the day.
In theory.
But the thing about theories is they don’t always play out as expected when put to the test. Like Yogi Berra said,
In theory there’s no difference between theory and practice. In practice there is.
When I was finally able to pull together actual numbers (instead of the probably “about” numbers we’d been theorizing over) it was immediately obvious.
That won’t work for us.
Too much into the negative cash flow. And right now we don’t need any negative cash flow! (I mean who really does?)
Putting on the Brakes
So I had to make a bunch of calls and tell the folks involved that it wasn’t going to work for us.
They were professionals and tried to offer up options. “What if we did this…”
We’d already thought through all the options they came up with. No dice.
Those calls weren’t easy to make. It wasn’t fun to tell people, “Well the truth is we really can’t swing this one right now.” More correctly we weren’t willing to put ourselves into an untenable situation just because it was a good deal.
I mean someone would have loaned us the money. I just want to be sure I can pay it back!
Some Food for Thought
So here are some things to think about.
How do you respond when the reality doesn’t match the theory?
Are you willing to make a course correction when things aren’t working out as expected?
Can you cast aside a project you are emotionally attached to when the evidence indicates it isn’t the good idea you thought it was?
I promise making that correction won’t be easy. And it is no fun calling folks to tell them, “I was wrong.”
But we were never promised life would be easy. I can’t find that written anywhere.
Can you do the right thing even when it’s hard?
