An Introduction

Hi, and welcome to Richard and Kathleen's house blog. After six months of trying for this one house, involving three escrows, three mortgage brokers, three weeks in a hotel, and lots of prayer, we finally moved into our 100+ year old Victorian in August. We are very happy with our decision, and can't wait to share our restoration projects with you so that you can restore a Victorian vicariously through us. Because let's face it; it's not for everyone, but everyone can certainly enjoy reading about it.  

Though I would like to immediately go into the details of our progress so far, the type of loan we got is critical to understanding why we are making certain repairs before others. The bottom line is that we absolutely could not have bought this house without a 203K Rehabilitation loan. Trust us. We tried every other way, hence the three escrows. The 203K loan is a government-insured loan that is specifically for houses that do not meet the Federal Housing Administration’s (FHA) standards. A few ways in which our house did not meet their standards: broken windows, uninstalled toilet and sink, broken water heater, holes in the walls and ceilings, a caved in ceiling, exposed electrical wires, etc. The purpose of a 203K is to borrow additional money on top of your purchase price to fix these things. But, you have to find a bank that is willing to lend more for a home that what you are paying for it, which these days is very difficult. So we had to borrow more money to cover things which add to the resale value of the home, not just the bare basic things that had to be fixed. This included things like repainting, popcorn ceiling removal, new appliances, tankless water heater, etc. We didn’t like this part of it because even though we wanted to take care of these non-essential things eventually, we weren’t keen on financing them for 30 years, but like I said, we had to do these things to get the home loan. And even with the additional money we had to borrow, and including insurance and taxes, our house note was still considerably less than rent. So we still think this is a wise decision.