Where we are thus far
So really I'm just procrastinating as I should be working but this house stuff is on my mind 24/7 and I think it will help me procrastinate less if I just get out everything somewhere, so that somewhere is here!
Just to recap, hub and I have been talking about building our own home FOREVER! Since before we were married. At that time, his parents had a 300 tsubo tract of land (nearly 1000sqm) and we were going to build there. I don't know why we didn't apply for a loan then. It would have been the perfect time and we most certainly would have been approved, but we didn't so no point mulling over it. A year or so after I moved to Nagano the company's warehouse was being forced to move back further from the street by the city and at the same time, my in-law's next door neighbors were going to tear down their house and rebuild, so instead of rebuilding the warehouse further away from the street, they asked their neighbors to trade land with them, and they did, but the new land was a much bigger plot and in order to afford the trade my in-laws had to sell the 300 tsubo tract of land.
Time for a new plan. There are two unused buildings on my in-law's land next to their house. The new plan was to renovate the two buildings and add a new portion. The loan was going to be tricky as were the building codes. There are all kinds of rules about renovating and building and adding on, and these buildings are OLD, Meiji era (1868-1912) old. Anyway, with this idea in mind we went to the bank with my FIL who said he had done all the groundwork with the bank and they were going to give us a loan. We fill out all the paperwork and we were supposed to hear back from the bank within a week. A month goes by and nothing. We call the bank and the guy who was handling our loan has been transferred. Someone else is handling our paperwork and he'll get back to us. Another month and nothing. Call again. This guy was also transferred. Long story short, we were not approved for a loan.
We did start to work with an architect on our ideas though and he drew up some simple plans for us that I took to my bank 6 months or so later to try applying again. Hub and I were applying together for the loan, 50-50. The bank calls to tell me we weren't approved. My company was doing really well, but I only had 2 years of taxes filed at the time under my new company name and hub's company has been doing abysmally for the last few years so they advised we try again in a year when I had 3 years of taxes and to leave hub's name off the loan.
We changed our building plans and decided to build an entirely new house to avoid the headaches of trying to work within the building codes for renovations, and had the architect draw up new plans. I spent the last year working with my accountant, keeping him informed of my plans and he made friends with the home loan officer at a local bank and put in a good word for me. When it came time to file my taxes we were in a conundrum though. I have been working super hard so the bank sees me as a viable borrower and in doing so I have placed myself in a tax bracket I really cannot afford. I would prefer to lower my income on paper with as many deductions as I can get away with, but by doing that I was also afraid the bank would see a lower income and we wouldn't get as big of a loan as we were hoping for. So my wonderful accountant drew up my tax forms with the lower income number and sent me to the bank to file a preliminary loan application and if it went through with the lower number I would write off everything I had planned to, but if they wanted to see more income from me, then we would rethink my deductions. Well, the loan went through! All. On. My. Own. Hub and his father both have to be guarantors for the loan and the land needs to be put up as collateral, but the loan is 100% in my name. I'm pretty damned proud of myself for that.
The loan officer then needed to check out the land to see the number of buildings on it because that changes the worth of the land for the collateral so we met him yesterday morning and boy was he surprised to see exactly how much land there is! When I told him how much I wanted to borrow he kept saying "that's an awful lot of money! How big is this house you're building?!" But when he saw the land he finally understood.
So our house is going to be fairly far away from the street, and we're hoping to create a parking lot in front of the house and rent out spaces to local businesses to create some extra income. On top of that, those two buildings we were planning on renovating originally, I want to create a cafe /shared office space on the first floor and AirBnB or rental accommodations on the second floor of one building and the other building I would like to completely refurbish as living quarters for my in-laws, or if they don't want to live there initially because they have their own (broken-down, decrepit) home (with no bath or shower inside the house and the toilet isn't connected to the city sewage system so it REEKS!), we can rent that out too. At any rate, we will have PLENTY of space for guests to come and stay.
When the loan officer came he asked me to take out a business loan to establish my relationship with the bank. I was thinking about setting up an LLC in a few months and he said I could use the money as capital for the business so I think that is what I will do and hopefully that will make things easier (in terms of getting another loan) when we are ready to renovate the other buildings and operate them as a business.
I really want to post photos of everything though. Next time we're there I'll have to remember to take some because when we were there yesterday I could just feel how awesome this is going to be. The space is so perfect for a cafe. My FIL has a really lovely (kind of messy) Japanese garden there that we can spruce up and make perfect for people who want to experience "old Japan." There's a maki-buro (wood burning bath) on the land that they no longer use, but my FIL was saying how he wants to clean it up and if guests staying are interested in trying it he'll make a bath for them. When he said that I got *really* excited because it means he is just as into this idea as I am. Funnily enough, hub seems a bit reluctant about the whole cafe/AirBnB idea, but I'm really glad his father is on board because that was going to be the biggest hurdle.
Okay, enough procrastination for now. Must get some work done before I fall asleep at the computer.
Just to recap, hub and I have been talking about building our own home FOREVER! Since before we were married. At that time, his parents had a 300 tsubo tract of land (nearly 1000sqm) and we were going to build there. I don't know why we didn't apply for a loan then. It would have been the perfect time and we most certainly would have been approved, but we didn't so no point mulling over it. A year or so after I moved to Nagano the company's warehouse was being forced to move back further from the street by the city and at the same time, my in-law's next door neighbors were going to tear down their house and rebuild, so instead of rebuilding the warehouse further away from the street, they asked their neighbors to trade land with them, and they did, but the new land was a much bigger plot and in order to afford the trade my in-laws had to sell the 300 tsubo tract of land.
Time for a new plan. There are two unused buildings on my in-law's land next to their house. The new plan was to renovate the two buildings and add a new portion. The loan was going to be tricky as were the building codes. There are all kinds of rules about renovating and building and adding on, and these buildings are OLD, Meiji era (1868-1912) old. Anyway, with this idea in mind we went to the bank with my FIL who said he had done all the groundwork with the bank and they were going to give us a loan. We fill out all the paperwork and we were supposed to hear back from the bank within a week. A month goes by and nothing. We call the bank and the guy who was handling our loan has been transferred. Someone else is handling our paperwork and he'll get back to us. Another month and nothing. Call again. This guy was also transferred. Long story short, we were not approved for a loan.
We did start to work with an architect on our ideas though and he drew up some simple plans for us that I took to my bank 6 months or so later to try applying again. Hub and I were applying together for the loan, 50-50. The bank calls to tell me we weren't approved. My company was doing really well, but I only had 2 years of taxes filed at the time under my new company name and hub's company has been doing abysmally for the last few years so they advised we try again in a year when I had 3 years of taxes and to leave hub's name off the loan.
We changed our building plans and decided to build an entirely new house to avoid the headaches of trying to work within the building codes for renovations, and had the architect draw up new plans. I spent the last year working with my accountant, keeping him informed of my plans and he made friends with the home loan officer at a local bank and put in a good word for me. When it came time to file my taxes we were in a conundrum though. I have been working super hard so the bank sees me as a viable borrower and in doing so I have placed myself in a tax bracket I really cannot afford. I would prefer to lower my income on paper with as many deductions as I can get away with, but by doing that I was also afraid the bank would see a lower income and we wouldn't get as big of a loan as we were hoping for. So my wonderful accountant drew up my tax forms with the lower income number and sent me to the bank to file a preliminary loan application and if it went through with the lower number I would write off everything I had planned to, but if they wanted to see more income from me, then we would rethink my deductions. Well, the loan went through! All. On. My. Own. Hub and his father both have to be guarantors for the loan and the land needs to be put up as collateral, but the loan is 100% in my name. I'm pretty damned proud of myself for that.
The loan officer then needed to check out the land to see the number of buildings on it because that changes the worth of the land for the collateral so we met him yesterday morning and boy was he surprised to see exactly how much land there is! When I told him how much I wanted to borrow he kept saying "that's an awful lot of money! How big is this house you're building?!" But when he saw the land he finally understood.
So our house is going to be fairly far away from the street, and we're hoping to create a parking lot in front of the house and rent out spaces to local businesses to create some extra income. On top of that, those two buildings we were planning on renovating originally, I want to create a cafe /shared office space on the first floor and AirBnB or rental accommodations on the second floor of one building and the other building I would like to completely refurbish as living quarters for my in-laws, or if they don't want to live there initially because they have their own (broken-down, decrepit) home (with no bath or shower inside the house and the toilet isn't connected to the city sewage system so it REEKS!), we can rent that out too. At any rate, we will have PLENTY of space for guests to come and stay.
When the loan officer came he asked me to take out a business loan to establish my relationship with the bank. I was thinking about setting up an LLC in a few months and he said I could use the money as capital for the business so I think that is what I will do and hopefully that will make things easier (in terms of getting another loan) when we are ready to renovate the other buildings and operate them as a business.
I really want to post photos of everything though. Next time we're there I'll have to remember to take some because when we were there yesterday I could just feel how awesome this is going to be. The space is so perfect for a cafe. My FIL has a really lovely (kind of messy) Japanese garden there that we can spruce up and make perfect for people who want to experience "old Japan." There's a maki-buro (wood burning bath) on the land that they no longer use, but my FIL was saying how he wants to clean it up and if guests staying are interested in trying it he'll make a bath for them. When he said that I got *really* excited because it means he is just as into this idea as I am. Funnily enough, hub seems a bit reluctant about the whole cafe/AirBnB idea, but I'm really glad his father is on board because that was going to be the biggest hurdle.
Okay, enough procrastination for now. Must get some work done before I fall asleep at the computer.
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