Well, I think that at this point it’s safe to make it public without jinxing anything. It’s time to tell you that we’re moving to the country!

It all started with a casual Sunday afternoon motorcycle ride with Vivian…

Actually, no. It started much earlier than that. Sonya and I have always, sometimes in the front of our minds and sometimes in the back, wanted to live on a large property with a lot of space and a farm house. Sitting on the front porch swinging on our porch swing, hearing the sounds of the country and looking up at the stars on a clear night, and having enough room to breathe outside of the suburban neighborhoods that we’ve lived in so far. It’s always been a dream that the two of us have shared throughout our 23 years of marriage. But with life, and bills, and kids, and all the things that happen, it hasn’t really been a priority pushed to the front burner. We wanted to get there eventually, but if not, that would be fine too. God is good all the time.

So that brings us to that motorcycle ride. Vivian is pretty good at talking me into taking her for a ride when we have a chunk of spare time. So, on this Sunday afternoon in early August, we took a ride down Indiana State Road 135 South to Indiana 44 West into Martinsville. It was a route that I’ve taken many times. It’s a fun motorcycle road with a lot of curves. Except this time, a “For Sale” sign with a header that said “Mini Farm” caught my eye. “A mini farm for sale? Nah. Way too expensive. No way.” But we circled back and took a look, snapped a picture of the sign with the realtor’s contact information, and rode on to Martinsville to eat at Texas Corral.

We got home, and I brought it up with Sonya and she was lukewarm to the idea. We thought about it. “Nah. Not the time. Probably way out of the financial realm of what we could do right now.” So we shelved it for a while. Then, the subject popped up again. “Ya know, it wouldn’t hurt to just look at it. See what it might take to make it a home.”

So, about a week after our motorcycle ride, kinda on a whim, I gave the listing agent a call. Sheila. Really nice lady. Had a really good conversation. She told me a bit about the house and that it needed a lot of work (which we could tell from the pictures on the Zillow listing). The current owner of the property had owned it for a couple of years now, and had started to work on the property for his father before he’d passed away, but the house has not been lived in for several years.

She told me that there had been a few offers on the property, but that none of them had gone through. Hmm. I asked her if we could set up a time to see the property. She told me that we had to be pre-qualified to schedule a showing. “Hmm. Not sure we’re there yet.” Honestly, I’d never heard of needing to be pre-qualified to purchase a property before seeing the property to make sense if it would be a consideration. So we shelved the idea again.

Well, the idea wouldn’t go away. Owning a property with some acreage was just too appealing to us and this just might be our one and only shot. And we certainly weren’t afraid of putting some labor into a house that needed fixing up. So I made some calls. I called a friend of ours who had some experience restoring older homes to get his thoughts. I called a friend of ours who had experience financing fixer-upper homes. Then I called a recommended local bank to discuss what that process would look like, generally, and… to go ahead and get pre-qualified for the property in order to set up a showing. 😐

The Showing

It’s now August 29, and we have an appointment to see the property. I think Sonya and I are still just looking at this point and not anywhere close to committing to this distant pipe dream. We’re just taking a walk around a property to try to visualize living here.

I shot some video of the property and house and detached 3-car garage and barn. So much space! Yes, the house does need a lot of work. That’s for sure. It’s also a little bit smaller house than what we are currently used to. But certainly adjustable. The house, structurally (with an untrained eye), looked to be pretty sound. Nothing really obvious jumped out as being a huge problem. We were starting to get a good feeling about making a serious move on this idea.

A couple of days later, we made a second walk-through with the friend of ours who renovates older homes for him to take a look. Nothing really jumped out at him either as far as anything majorly wrong, which was good to get that confirmation. The amount of money to initially be put into the house was going to be significant, but we sorta knew that already. This dream was becoming more of a reality.

The Offer

The negotiation of the purchase agreement was an interesting process. We decided to use Sheila as both our agent and the seller’s agent to keep the closing costs lower. The plan was to intentionally come in with a low offer, knowing that it had been on the market for a few months now with little activity. We suspected that in this day and age, home buyers were looking to buy homes that were move-in-ready and apprehensive to take on a project like this. Interest rates have been rising, which has stifled the market a bit. We also know that the seller was motivated to sell as he was losing money with every passing month.

On September 5th, we decided to make an offer on the property of $40k less than asking price and a 1st-right contingency (pending an accepted offer our house) to see what he’d say. If he kept the negotiations going, then we would continue, but if not, then at this point, that was fine, too. He countered with a few interesting requests: $15k higher, $10k in earnest money, and restrictions on times for us to get an accepted offer and close on our house. Strange to us to make these requests, but whatever. Part of the negotiation. So we countered with an increase in $5k, a request to remove the time restrictions (which we felt like we didn’t have any control over), and only 1% earnest money down. He agreed but asked for an additional $5k in the asking price, and we reached an agreement on September 8th.

The Listing

So, with the earnest money dropped off at the title company, we’re in this now. Time to give some attention to our house and get it ready to bring onto the market. Since we had already somewhat established a relationship with Sheila, we sort of organically decided to use her as our listing agent. We had a couple of other agents that we were considering working with if we’d gotten to that point, but Sheila (and her husband Matt) seemed to be working hard for us so far, so we decided to nurture the relationship.

While getting a listing agreement in place, we had to determine what price to sell the house for. We’d been living here for 7 years and the “Zestimate” (the home selling website Zillow’s estimate for how much your home may be worth) had it at over 80% higher than the price we bought it for in 2016. Seemed to be a good time to sell! There were four other homes for sale in the neighborhood, so we had some competition, but none of them had a pool. We didn’t go high, we didn’t go low, we went Goldilocks- just right.

The first thing we had to worry about was getting the house ready for pictures. Sonya always does a great job keeping the house clean and almost show-ready at all times anyway, but there were many odds-and-ends jobs (some of them waiting for us to do since we moved into the house seven years ago) to do so they wouldn’t stick out in the pictures and during the showings we would be having soon. Trim repair inside and out, paint touch-ups, mismatched tiles in the basement drop ceiling. But the big one was the pool.

We hadn’t really used the pool much this summer, so it had been sitting. It takes a while for it to clear up, so I started right away. Chlorine shock. Buttloads of chlorine. All the chemicals. C’mon baby. And then, just as it’s starting to clear up, the inline chlorinator starts leaking at the connection. Timely. For the life of me, I can’t get it to stop. This is the Sunday morning that I am leaving for a week-long work trip. So I buy another one off of Amazon. It arrives by the time I get home that Friday, but it doesn’t match the thread pattern of the existing connections. So, I buy another set of connections to pipe in. It’s PVC, so at least it will be easy to work with. They arrive and I pipe them it. Still a mismatched thread pattern! Ugh! So I return the one I bought, cut out the connection for the inline chlorinator, and hard pipe it, and I buy an offline chlorinator instead. Meanwhile, the pictures are taken and posted to Zillow with the swamp pool, showings are happening, so embarrassing. Luckily, potential buyers are patient enough to overlook it for now (so we’re told), and the pool finally clears up in time for the upcoming inspection.

The Showings

The listing goes active on Friday, 9/15, and we have showing #1 on Saturday, 9/16 at 11:00am! We knew this listing agent personally, so it was good to have some additional feedback there. Sunday 9/17, we have two showings at 10:00am and 1:15pm! Monday 9/18, we have a repeat showing! Then we have two more showings on Wednesday and Thursday. On Friday, 9/22, we get our first offer that came in overnight. 7 days on the market! Sheila then sends out the word to all of the listing agents who had earlier showings to let them know that an offer was on the table, and she draws in a second offer at our asking price! That’s where we want to be! Of course, we consider both offers, but they aren’t even close. The second offer was much stronger, and we accepted it as-is.

The Inspections

This part is, in my opinion, the worst part of selling a house. It’s going around and fixing up all the things that you think may be wrong with the house, but in the end, a trained eye by someone with opinions, who is working for they buyers, whose job it is to find as many things wrong with the house, is going to give his somewhat subjective assessment of what needs to be further be done to fix your house.

The inspection of our existing home was Thursday, 9/28 from 4 to 7pm. After that we had to wait for the results. They had until 10/3 to respond with their requested repairs or an allowance to have them performed themselves. On 10/2, the buyers came back with a list of small repairs that needed to be done and a request for a $4500 allowance to have a contractor make the repairs for them. So, all in all, better than it could have been. The fear of the unknown, and the waiting, was causing me a little bit of anxiety and it was a much better outcome than it could have been.

The inspection of our upcoming home was Friday, 9/29, and we were able to be on site with our inspector, Daniel, while he combed the house. I don’t think that we learned too much more about the house that day. It’s a house that needs a lot of work, but we did find out that it is very soundly constructed, likely with wood milled on the existing property. It’s consistent with a house built in the early 1900s, probably 1910 to 1920 (although the age of the house is currently unknown – some records have it built in 1800, which is unlikely). It has no foundation problems, no termite damage, little mold, no major roof problems on the main structure. Overall really good shape. The detached garage and the barn have some possible foundation problems that may need to be addressed.

We did run into a problem with the plumbing. We turned the water on, and a pipe that looked like was going to an outside spigot was cut. So, we were not able to test the existing plumbing or the septic system, so we had to return to complete the inspection the following Wednesday, 10/4.

This follow-up inspection, of course, was not without incident. The goal of today’s part of the inspection was to 1. get a feel for what the condition of the plumbing system was in, and 2. test the septic system to make sure that 6 people could easily live in this house. The finger field of the system was tested using a flourescent dye – the goal is to see no dye in the yard.

We went to turn on the water and open up all of the water sources in order to “overload” the septic system to see how it performed. Daniel went to open the kitchen faucet and it both would not deposit any water and started leaking. That’s about right! We looked at the 1/2 bath to see about it and the faucet wouldn’t work and the toilet had a crack in the tank. Moving on. The 1st floor bathroom shower was shot and not an option, and the sink was a no-go, but the toilet worked, so he flushed the dye tablets down and we let the water keep running. The upstairs bathroom is also a complete gut-job, but we were able to get that sink going as a water source. We also ran a garden hose from a spigot in the cellar to a slop sink in the laundry room. With those, we were able to get a pretty descent flow rate to the septic tank.

Overall good news! Daniel was able to find the lid to the tank and open it up. It’s a good sized tank and should be perfect for our family! Daniel also noticed that there was no “sludge” at the bottom, so it didn’t need to be pumped. We let those three water sources run for 2 hours and the system performed beautifully! Very happy about that!

With that, the inspection was complete. Conclusion: This house needs a lot of work.

The Financing

Financing this home is a little different from the other homes we’ve purchased. For our other three homes, and the refinances, since I’m a veteran, I was able to purchase them with a VA loan, which allows 100% of the loan to be financed without having to pay personal mortgage insurance (PMI). This home purchase will be different for us.

I spoke with our earlier-mentioned friend about what financing would look like in the case of purchasing a home to be renovated. He gave me some good ideas and also gave me the names of a couple of lenders that he’s worked with in the past. I called one of his recommended lenders and he walked me through the process.

After an appraisal of the current condition of the home, it was classified as “C5”, or “Significant Deferred Maintenance”, meaning that a lot of work would need to be done before moving into the house and securing a conventional mortgage. This we pretty much knew.

So we are opening a “bridge loan” or “construction loan” to both purchase the house and property, and to have the needed repairs done. What is still confusing to me is that the lender initially appraised the home, as-is, as C5, but told us that they could not tell us what needed to be done to the house to get it to C4, deferring to the home inspector to determine what needed to be done. I was thinking that was the point of appraising the home, but I have that wrong, apparently.

Then the appraisal came back.

Looking at financing homes like this, it must be a huge risk as a lender. I’m sure people get money lended and don’t complete work, using the money for other things. Of course, this leaves a bank with an asset that is ultimately of less value than what was lended. It’s not going to be the case with us, but the bank doesn’t really know that.

Our loan request was for the cost of the house/property, plus the estimate of the costs to repair the home given by the contractor – I’ll call this the “perceived value” (I’m not sure if there’s an actual term for this or not). But, for a construction loan, the bank would only be able to lend 95% of the appraised value.

Then, there was the appraisal on our existing home. So far, my experience has been that a bank will send out an appraiser to take a look at the property and make sure that the amount being financed is in line with what the property looks like. With the other two homes that we owned, including refinancing and home equity loans, I never really heard much from the appraiser. However, I suppose things have changed with the drastic increase in home prices, interest rates, increasing inflation, among other things. This appraiser made an appointment to come inside the home and look around, in addition to inspecting the outside of the home. Following the visit, he made three additional requests for repairs, which I’d never heard of any appraiser asking for. We suspect that since our buyers were purchasing the home on a VA loan, this was probably the reasoning. And the requested repairs were kinda stupid: handrails to be added to the steps on the deck, fix a crack in the siding on the front of the house, and secure some of the screws on the false shutters. Okay? We got word from the buyers that they were a little upset with these requests and that they had nothing to do with them. I guess the scrutiny for lending money for homes these days has ratcheted up a few notches.

The Closings

Closings on both properties happened on Monday, 10/30 and they both went really smooth. Nothing really out of the ordinary or interesting to write about. We finally met the buyers of the 1155 house face-to-face, which was really nice. They seem like a really nice family with two kids and one on the way. We also officially met the seller of the 6555 house. He actually lives down the road from us so we’ll technically be neighbors going forward. Really nice guy. Looking forward to getting to know he and his family soon.

The Move

Following the closings comes the move. Since renovations will be taking place, over the next four to six months, we will be staying with Sonya’s mother Cindy, trying not to wear out our welcome. We’ll be living there, I’ll be working there, and we’ll be working at the house in the evenings and on the weekends in an attempt to get the house ready to live in by March or April or so.

The seller of the new house allowed us the weekend before closing to move our things into the detatched 3-car garage where they will be stored until the house is ready. Moving day was Saturday, 10/28 and we have until 7:00 PM 11/2 to say good-bye and be out of the old house.

We had quite the crew show up on Saturday to help us move! They all made it so much easier for us and we’re grateful for their help!

The Credits

I certainly want to take a moment to thank those who have helped us over the past 3 months. No doubt, there will certainly be more headaches and anxiety coming to us as we dive into this adventure, but the people that have helped us navigate these uncharted waters are certainly to be commended. Thank you!