Tonight is the purchase workshop thingy at NACA. Jim and I are a little worried about the amount we were approved for. The amount is VERY close to what we need but can fluctuate depending on homeowners insurance, home owner’s association dues and much needed flood insurance (backs up to a creek). We can’t get a solid confirmation on flood insurance without an elevation certificate which doesn’t exist yet. Our insurance agent says it will be $400 to $4,000 a year. Yeah, we think the range is quite obnoxious too.
NACA is all about making sure we’re protected and can pay. Since we sold our Florida home in 2008, we’ve wanted to scale our financial burdens back. We don’t want to be in the situation where one of us loses our jobs and its suddenly an “awww shit” situation. Sure, it would be scary but we’d like to know that we have something in savings. For so many years, we’ve lived well but paycheck to paycheck. We don’t want that any more. So qualifying with just Jim’s income is awesome. It will keep us away from payments we can’t afford! Well, that’s the plan, anyways.
We showed up for the workshop. It was only Jim and I. Prior to the workshop starting, our counselor gave us our approval letter and then we bombarded him with our questions and concerns. Jim and I found out that we have a little extra just in case. That totally puts our fears about not being able to build this house aside. We found out that our rate lock (4.5%) will be good during the entire construction process even though there’s no construction loan, just a $1000 deposit to the builder. We also learned that our approved amount was calculated based on our average savings account balance and our rent payment amount and timeliness! Very unconventional but that’s OK, it worked out for us. NACA uses this method to calculate instead of credit. It’s funny that we told the builder salesperson, Michelle, that' we’d have no problem qualifying with our wonderful credit scores yet they apparently had nothing to do with it. Oh, and Bank of America will be the lender. NACA is a broker of sorts. If you want any additional info about NACA, check the website or ask me and I’ll get Jim to answer it. He’s better at that “stuff” than I am.
After we received our letter, we watched a slideshow presentation by some NACA realtor guy who was helpful in explaining the entire process of contract to close. Since it was just Jim and I there, he tailored his presentation a little more toward building.
With all that out of the way, we figured out that although it will be “tight” we can build this house. Not tight like whether we can actually afford it but rather that we have enough pre-qualification. The next thing will be to make sure the builder can meet us on some of the upgrades we want in both price and ability to do it.
I’ll set up an appointment with our Realtor to meet with the builder for Saturday. Hopefully by the end of Saturday, we’ll have a contract in hand.