Show me the money!
We moved out in to the rental mid July. Finances had come back from the accountant, application was in with the bank, we know we can service the loan, builder was almost ready, it’s going to take us a few weeks to move in — let’s do this thing!
Part of the financial process requires the bank to get an estimate on the value of the house on completion. Given recent valuations we know in the area, we expected the valuation to come in well above what we actually needed to make the construction loan work. It only takes a few days, so should be easy.
Should of course being the sticky point on any project! Phone call came through from the broker, we’re practically opening the bubbles in that moment, but the “val” was a full $50k short!!! We maybe should have seen it coming when all he talked about when inspecting was how we should think about knocking it down and building a sensible off-spec brick house or two on the block. Hearts promptly plummet to the floor. We’ve got a 6 month lease on a crappy, tiny, stinking hot little house, we’re living here, I’m trying ever so hard to be positive, but OMG this kitchen is so fG small!!! Our gorgeous little house we love is standing empty, and we don’t have any money for the build — ahhhh!!!!
It’s OK, he reassures us, we just go to another bank, and try again. We spend a week waiting for a phone call from the next valuer, a few more days chasing, only to discover that the next bank chose the same valuer! Same number!
So to another bank, that took another week, eventually came out, had a look, had a chat, seemed to understand what we were trying to build, a few more days to send us his val, finally…..the right number! After about 3 weeks of reworking the numbers, assuming we would have to do just the minimum, figuring out how many corners and expenses we could cut in the next few months to get it done, finally it’s all systems go! We can go all the way to Scenario 3 (Andy!), which even includes some plants for the garden!
Oh but wait, you need some insurance on the house. Say what?!?! The house is empty, the builder’s insurance covers it as soon as he takes the keys til he hands them back. We can’t insure the future house that hasn’t been built yet — what would be insuring? But the bank needs insurance….so a few phone calls and somewhat simplified explanations compared to the reality of what we’re actually doing, and we’re sorted. So the money will be with us any day now.
Oh but wait, the lawyers of the two banks need to have a chat to each other (book in a phone call), to agree to book a date (on another scheduled phone call) for a meeting (face to face), to sign the papers to exchange the mortgage. That will take about 3 weeks (they tell us week by week of the process!). Have you people heard of emails?! Electronic transfer of information?!
And breathe….about 6 weeks later than originally planned, the mortgage is transferred, money is in the bank, the builder has his deposit — this time it’s time to play!
