Moving Forward

This is the 37th blog post we’ve posted on this site.  The first one was nineteen months ago.  We thought we’d be done and moved in by now.  In the arc of the story of remaking the Going Queen, we’ve had some challenges to overcome.  No surprise there.

Our first sign was the difficulties we had just trying to buy it. We tried a half-dozen mortgage companies and banks to get a loan and it seemed nobody would be able to do the deed**. Fortunately, Umpqua Bank was willing to work with us.  They had the ability to hold the house as a portfolio property which helped avoid some of the underwriting issues we’d have on a house we weren’t able to properly inspect or appraise.

And then we sought out and hired a general contractor.  That general contractor overran the cleanup budget, consuming all the remaining cash we had to get the initial work done on the project.  He mislead us on what he could do the work for so by the time we received his bloated estimated we were in some deep doodoo.

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We resumed working with architect who that first contractor had brought on, who then brought in an engineer, and we worked with them to create a new plan.

Our goal was to act as our own general contractor and avoid the risk we perceived by being at the mercy of some 3rd party.

As general contractor, we started selecting our sub-contractors. I put out a plea for local contractors to reach out to us.  A few did, but not the full range of skilled trades we’d need.  We started reaching out further and interviewing more subs. We collected bids for the roof, siding, windows, plumbing, electrical, foundation, paint and tile.  There were some holes in our planning.  We’d not yet found a framer, drywell/plaster and finished carpentry but were getting close.  We weren’t sure how to execute the engineers plans for structural upgrades.

While waiting for the sometimes frustrating design phase to work through it’s process, we were also waiting for October 2017.  On October 1st, we would be hitting the two year’s of ownership on our condominium we’d purchased downtown so that we could sell it without having to pay the 15% capital gains tax on the appreciation we imagined it had.

We were lazy about selling.  It was such a nice summer and fall and we were enjoying being on the waterfront.  Once it started to get cold, wet and gray we finally got around to moving out December. By the time we got the condo listed for sale, the Home Owner’s Association had sued the builder and all the condos in our buildings went into litigation creating a host of new challenges for us.

In hind sight, we should have immediately put the condo up for sale in February of 2017 and moved out.  We paid dearly for waiting.

Everything seemed to come together for us this summer.  We’d received the final, permit ready, drawings and engineering from the architect.  Our amazing realtor found an all-cash buyer for the condo so we could get out from under paying two mortgages.

We closed the sale of the condo in July.  We retired all our debt and put the rest of the cash in our checking account where it could ‘season’.  We waited 30 days for our credit score to adjust to get the best possible rates.

Then we called Umpqua Bank to go over our plans with them.

These plans got shot down in the first minute on the phone with Jason Spohn.  He’s an Associate VP, Branch Manager and NMLS Licensed Broker at Umpqua.  He helped us finance the original purchase of the Going Queen and he’s also coordinating some business financing for us as well as worked on mortgages of a few friends and colleagues .  He’s very good at what he does and we trust him.

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We explained we were ready to go and would be acting as our own general contractor and that we had a preliminary project budget.  He told us to stop right there.  He said Umpqua can’t do a two-party construction loan.  They need a 3rdparty, the contractor, so we have some checks and balances.  It makes sense, but it meant that we had to do something we very much didn’t want to do.

Umpqua Bank gave us a list of a several contractors that they have worked with in the past and asked us to start with them.  They said since they are already known to the bank and have completed projects with Umpqua it would make things a little easier.

So, we went to work evaluating general contractors.  Only this time we were going to do as much due diligence as possible.  In the next post I’ll tell you how we selected a new general contractor.

 

** I’m sorry about that pun.