"Before" picture

"Before" picture

Saturday, April 3, 2010

Mortgage refi and grading plan

Our preparations for beginning the remodel continue. We sat down and looked at our funding options and discovered that it would be cheaper in the long run to refi our mortgage with the credit union than to take out a home equity loan. We applied on Tuesday night online, got conditional acceptance on Wednesday morning, and now I have to call the loan officer on Monday to talk about the details. Assuming we get the terms we wanted, we'll be getting a 20-year loan (current mortgage has 24 years left) at 5% (current mortgage rate is 5.26%). The mortgage payment itself should rise by only about $210/month.

They may want us to set up an escrow account, something we haven't done except for the first year or so of our original mortgage until we refi'd that one. We've been handling our own taxes and kind of prefer to keep going that way, but if it's a condition of the loan, we're not going to decline solely based on that expectation. It would be something to get used to again, but it wouldn't be the end of the world.

Meanwhile, Ken visited the township inspector's office and got all the info he needs to finish the plans and submit them for permit approval. Permit costs will be around $900, and they want us to put $1000 in an escrow account, presumably in case down the line they discover a violation. If we wrap up the project with no problems, we get that money back.

The one surprise that arose during that visit is that Ken needs to submit a grading plan, meaning he has to give them a plan showing the contours of the ground on our property. We didn't have to do any such thing back in 2003 when we built the garage. We have a quarter acre, so it'll be no small task. And the only way to do it successfully was for Ken to invest in a surveying rod and laser level. They're not cheap, but he shopped around and got them for about half what they should've cost, and when the project is over, guess what we'll be selling on eBay? If he doesn't get attached to that spiffy laser level, that is. At least that will come in handy for things like installing the kitchen cabinets, windows, etc. I like things with multiple uses. Now the surveying rod, on the other hand, meh. I think that can go when we're done with it. But if you know Ken, you know how he likes his tool collection. We could set up our own rental shop.

Now Ken has to set aside the time to do the grading plan and make any final tweaks to the house plans, and then we can submit everything and wait to see what the township says. We're not asking to anything brazenly new here--other homes in the neighborhood have added the rooms we plan to add--so we don't anticipate any major problems, but you never know when dealing with local government.

Last night we enjoyed entertaining some friends out on our deck, which will soon be the site of the new kitchen. While I'll miss having a backyard hangout this summer, it's definitely a trade up. The deck is practically falling apart, and before we would end up investing time and energy into fixing it up, we will tearing it down and tossing it into a Dumpster. So if you live nearby, you may see us loitering on our own front lawn a lot this year.

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