** I started writing this in December, but I never was able to bring myself to finish this entry. 2010 was a tough year. 2011 is a fresh year and as sad as it is to move on from some things, its truly a fresh start in many ways. — March 21, 2011 **
2010 is going to be remembered as very tough year. There were personal highs and very deep lows this year in our lives. This year will be the year of a new beginning with our house. We celebrated the house with some close friends on Saturday night to celebrate and thank them all for their support, love and help along the way as we have gone through the process of building. Without them, we couldn’t have completed the build. And that was a large, very good night for us to celebrate. It represents a big milestone in our lives. As part of that night, we asked each of them to bring a photo for our family and friends wall. Its one of the final touches we are adding to our house. We purchased a “tree of life” metal wall sculpture made by a local artist as the focal point of that wall and we are surrounding the tree with photos of all the people who are most special to us. The photos we adding at the party were just the beginning as we have lots more people to add to our wall. These strong relationships are so valued and needed for us to be healthy and their support in the last year has helped us pull through some difficult times. Continue reading 2010 year in review→
Yesterday was an exciting day. The first visible activity of our build has begun on the land and the builder is getting the site ready for a house to go in. The trees came down quickly yesterday and the lot looks completely different today. Here are some photos of the progress… A BIG ole THANK YOU to Tammy for sending us photos as she drives by!!
Received word from the bank today that the package is being sent to the lawyer’s office. I talked with the bank twice about details and I talked with the lawyer to let them know that the package is on the way. We hope to be closed on the construction loan within about 2 weeks…
In the meantime, the builder has sent the plans to the engineer and the truss designer to have them start on those projects. The builder is asking about placement of the home on the lot and so I have to look at the county’s GIS maps and decide how far back to place the house. Decisions, decisions, but we are moving forward!
The bank called yesterday, and we received our second appraisal. This time, the appraisal was in line with our costs to build and so the project is back on track. We are excited to report that Conway National Bank has worked out great for us with our building project. Given the appraisal results, we are in good shape to handle the cost of the build and anything that may come up, as well as pay off the small amount we owe on the land. Right now, the feeling of relief is just settling in and we are just now realizing that the project is going to finally happen. Jen and I had both mostly given up after a bad appraisal, a second bank turning us away and a third bank deciding that they didn’t like the amount of cash reserves we had (and giving no credit for having zero consumer debt!).
A few things that I have learned along this process:
Banks don’t care that you are debt free. When figuring your credit worthiness for a construction loan or mortgage, they want to see that you are less than x% gross incoming to debt with the loan. Having no additional debt did not help us… Because banks allow another 10% of your gross income towards the additional consumer debts. I found, at least in our case, you are better off saving your money than accelerating your payoffs on consumer debt.
Freddy Mac and Fannie May loans for construction are extremely difficult to get unless you have large cash reserves today. While I think construction is the best way to put people back to work, banks or the government seem not to agree because they have made it nearly impossible for the average American to get one of these loans – unless you can put down 30% of the cost of the home.
I had to work with local banks on in-house loans. Although this means a two-time close, and probably higher closing costs, I was able to find terms that were much more workable to our situation.
Appraisals are screwy right now. This has little to do with who is doing the appraisal, and more to do with the market. There is no delineation between a foreclosure, short sale and conventional transaction for appraisers. Its all one big pool and so the foreclosure and short sales have brought everyone down (yes, I know — no duh! — read or watch the news). But, I have also heard that appraisers are also doing their part and being intentionally conservative with the comps that they use on the appraisal. I don’t know how true this is, but based on what I have been told and the results of our first appraisal – I find it to be true…
There is no replacement for relationships. Throughout the financing process, the places that have worked best for us were the places where the people knew me, knew my extended family (or friends), and knew my reputation.
My credit score didn’t really matter… Yes, I know this sounds really odd, but CNB didn’t care about my credit score. They cared about my credit file and looked at each account and how it was managed and handled. Jen and I both had excellent credit scores, and my past experiences led me to believe that these were good enough.
Its a tough time for everyone. Although Jen and I have been largely insulated from the financial meltdown for the last few years, we were greatly affected by it while shopping for financing.
As we are nearing Christmas, we have a lot of things going on in the Sellers family. The biggest news will close this afternoon… Jen and I are buying land. We don’t have any immediate plans for the land, but we are going to hold on to it and hopefully build our dream home on it in a few years. But, we have to wait for the market to come back and find the correct time to sell the house we are in.
The land buying process has been almost a year and a half in the making. We had been looking casually for land for about a year even before that, but around September of 2007, we found an 1.75 acres that we were really interested in. It was near good friends of ours (psuedo-family) and it was enough land that we were happy, but not too much that we’d would be overwhelmed taking care of it… The area was very nice and it was the last lot in the group to be built on – so the area is as developed as it should ever be.
After negotiating for a few months with the builder who were selling it as a land/home package, we could never come to an agreement on the home and the price for the custom build. So, we made an offer for land-only for what we believed the land was worth. The owners wanted more but we were unwilling and walked away. Fast-forward to October of this year and the land was for sale as land-only, and for much less than they had previously thought the land was worth. We made an offer again for the same amount and this time it was accepted. Thank you sucky economy for something…
Anyways, we close this afternoon on the lot. Afterwards, Jen and I are going to drive out there and take a couple pictures of the land and of us on our land. Then we’re treating ourselves to the Right Recipe for dinner as a celebration…
Once we build, our address will officially change from Conway, SC, to Loris, SC. And, its much more peaceful out in the country. Its so quiet… I absolutely love it and I’m so very excited about this. Jen is, too.