Bank Appraisals- what a bunch of crap

I've been meaning to post about the plethora of paperwork that you'll need to sign your life away on in order to get a construction loan.  Sorry- really haven't had time.

Mike and I have been working on trying to finish clearing the land.  It's been a very laborious process and I think I've formed muscles in places I never had before!  Regardless- we're hoping for just one more day and we should be all set!

One of the things that you'll need to do is get your project appraised.  Mind you- the bank already has the amount of money you want to borrow at hand.  The appraisal place will take your specs, land layout, blue prints, etc to appraise the house.  They'll also take a look at what other houses are selling for in the area.

Well, we got a call today- so I apologize in advance if this sounds like a complete rant session, but maybe you'll feel the same way Mike and I do after reading this.

The cost to build our house (materials alone) is $145,000.  We have lots of upgrades in the house- like radiant floor heating throughout the first floor and the cellar, energy efficient trusses, ICF blocks for foundation for efficiency, Water on demand for efficiency, windows and doors that are rated for efficiency  (do you see where this is going?!).  Regardless, it's going to cost us about $145,000 to build.  Our land purchase was $55,000 and we've put a good chunk of change into it with putting in a driveway and clearing it ourselves.  The driveway project was almost $10,000, and clearing the land ourselves was a couple new chainsaws, some gas, some bar and chain oil, and lots of man hours, sweat, and blood.  So in TOTAL Just for costs, our house will cost us approx $210,000 to build (including the land and just the driveway portion).

We got our appraisal.  Guess what it was?! First- I should tell you that hte bank will only give you 80% of the appraisal.  As it stands right now- we have put $47,000 of our own money into this project.  We haven't gone out to eat in months (wedding/honeymoon not included) and frankly, haven't been "living" at all because we've been spending so much time and money at the property.  This is not a "feel bad for us" rant, this is a "I'm pissed off especially since we've done all this work to get nowhere" rant.

Ok appraisal... $214,000.  WHAT?!  You're telling me that we have to find a crew that will build our house for a grand total of $4,000?!  That's not possible!  You can imagine how we felt.  In order to borrow the money we need to build, we need the appraisal to come in at about $270.  We can work with a little less, but $270 is our magic number.  Regardless, Mike was pissed and my heart fell to the floor.  Mike was so upset, he actually called the bank (for those that know him well enough, you know he doesn't call ANYONE and makes me do all the calling).  Left a nice message to the lady we've been dealing with and told her to call me directly- that he was too po'd to take any phone calls.

She did call me and told me that there was an appeals process we can use to make the company redo the appraisal.  We're going to do it- but Mike talked me out of writing it up right now- and he's probably right- if we wrote it right now, we'd just be so fired up that we'd put things in there just to piss the appraiser off.

We went through all the paperwork- she's missing a whole bathroom on the first floor- she listed it as a 1/2 bath, and she's missing our 1/2 bath downstairs.  Now, I understand that "below ground" is not worth as much as "above ground" but half of our house is still "above ground" regardless, she put our SQ FT appraisal above ground at about $92/sq ft- and for those of you that understand this- this is really low even in today's market.  The below ground... a whopping $29/sq ft- we can't even build the below ground for that cost- so what the hell is this woman thinking?!  She put asphalt roofing- we have metal... the list goes on.  What makes us the most mad is she did the appraisal using recent sales in the "area" which stretched all the way 30 minutes south of us in a crappy neighborhood.  Of the 3 houses, 2 were older than 30 years and one was 20 years old.  Only one had as much acreage as we, and none of them had as much living space.  In total, their finished "above ground" floors ranged from $110- $148/sq ft... so EXPLAIN to me why ours is only $92?!

We are both so mad it's not even funny.  I want so badly to start building our house- but it's like every turn is a road block.

I'll be writing my wonderful message to the appraiser tomorrow to make sure she understands that she appraised our house wrong.  If it costs us $210 total to build, why is it worth only $214?  The worst part is, we gave her everything down to the countertops of what was going in this house.  The houses she used for comparison didn't have half of what we are putting in our house- especially when it comes to the efficiency matter.

This is not how I envisioned our house being appraised.  It makes me sick.  At least I have Mike to hug me and tell me that we will get it solved- and if the bank can't solve it- we're done with them and going with another one.

Oh and if anyone wants to know, the bank we are currently using is TD Bank, and the Appraiser was Powers, Smith, and Associates, Inc in Keene... in case you don't want to go through the headaches we are... Live and Learn- right?

Building love, through the most trivial experiences.