I think my husband and I are on the verge of a nervous breakdown right now, and I just need to vent somewhere, so here I am.
On May 31 we went to a local bank to talk to them about a land/construction loan. They told us they could do a one-time close with 5% down. Great! We applied online and got pre-approved for the amount we put in/requested. It took 2 weeks for the land seller to return from vacation & sign the contract for the land, and then we gave the title co our earnest money.
We got final numbers from our builder & realized we needed more money, so we asked the bank for a revised letter. The original LO we talked to stopped responding, so I called and talked to another LO. It was then that she realized - oh wait - the builder is not buying the land, so you'll have to do a two-close construction loan and put 10% down and pay 2 sets of closing costs. That changed EVERYTHING and we had to move money and numbers around to decide if it would work. We agreed, and the loan application was passed onto the construction loan LO at the bank.
In the meantime, the pump for the well did not work, and it took almost a month and a half for the new pump to finally be installed so we could get a well test/inspection done. We talked to our builder, picked out options, and started the "official" construction loan application.
It only took a few weeks at most and we were approved by the bank in August! JOY! After months of back and forth, messing with numbers, we crossed a major hurdle.
Oh wait. We need an appraisal. And it has to be at 80 LTV or else the deal is over unless we can come up with a boatload of cash (not happening, which I made clear to the LO). We pay the bank the fee for an appraisal on 9/4 (a hefty appraisal fee I might add, I assume since it's for new construction) and they tell us to expect it to be done by the 13th.
It's now the 16th. Neither I nor my builder has heard from the appraiser, so we know no one has the plans or specs in order to start working on the report. Time is ticking, and it's going on 4 MONTHS and we still have not been able to close to even start the process. Our land contract extension expires on Thursday.
We are on pins and needles, and there's no timeframe as to when this appraisal will be done. All of the stress, back and forth, sleepless nights, everything still all hinges on an appraisal, and we could be back to square one or just end up giving up. I am not sure how much more we can take. Tired of waiting, tired of stress, tired of worrying, and tired of little to no communication from anyone. Just. Tired. Thanks for letting me vent.
Thank you We are trying to take deep breaths and take it all one step at a time. We're just floored at the length of the process and now I think we have the "appraisal stress" where we just want to know what to expect next and if we can even get this house started. I know no matter what it will all work out, some days are just tougher than others. We will get there!
This is exactly what I try to prepare people for when they come to me for VA, FHA, USDA & conventional construction loans.
Here is an example of what I tell people upfront:
I think it's important to walk people through the pros & cons of these programs as well as the time frames so they can make an informed choice.
If they had told you it would take 4+ months to get you to the closing table upfront, do you think that would have helped reduce your stress?
Thanks, everyone. Yes, if I knew it would take 4+ months I think we would have been better prepared. This is 4 months not counting the actual construction phase which hasn't even started yet. We are going conventional and it's not all been the fault of the bank. The landowner decided to hire his own choice of company to install the new well pump and they took forever to get it done. It's an accumulation of hold-ups for various reasons that have just piled on, to be honest.
@Jville I agree. I read all over the place that the bank should ask for specs and plans, but our LO has never asked to see a thing. It seems to me she's relying on the appraisal first to come through, and then they'll get into the details with us once that happens. At least, that's my observation. The appraiser is contacting the builder directly rather than going through the bank (?) Maybe that's just the way they do things out here. Who knows.
I did find out this morning that the appraiser DID call our builder on Friday to ask for plans and no one got back to him/her. Needless to say, I was not happy about that, so the builder is contacting my LO today to work together to get the appraiser what they need. Keep us in your thoughts and prayers that everything comes through OK. Taking deep breaths as we go...
@Dynversmom - feel free to message me if you ever have questions - I am definitely no expert, but we have learned a LOT so far in the process, and it's always good to have support from someone dealing with the same thing. Maybe we can support each other : )
@Jville - Our bank is actually highly experienced in construction lending, and they've been locally financing new construction projects in the area since the 1950s. My loan officer has worked there since the late 1970s so she isn't new to this. On the other hand, I am definitely concerned about how things are going thus far, so all I can do right now is hope everyone does their jobs on the back end and we don't end up getting left out in the cold