Here is a picture of my house as it looked the day I bought it- September 1, 2009. The house-hunting was surprisingly short and relatively painless, but actually buying it was a different story.

My house

My house

It needed (needs?) so much work, that I did a 203(k) loan, which enables you to borrow extra money on your mortgage for repairs. It was a HUD home and had been vacant for a long time- at least a year. And from talking with the neighbors, I’ve decided that there were probably druggies living in there before. The worst part? The smell. Upon entrance to the house, one’s nostrils were immediately stung by that acid, consciousness-robbing odor of dog urine. I am convinced that this was the single most important reason my little brick darling had been on the market for so long. It really was enough to make you want to turn around the instant you went in. Nevertheless, as we do in our family, we smelled past all that and saw an adorable little bungalow just itching to be fixed up. Luckily my dad was visiting at the time and he convinced me that it could be saved. It was listed at $90,000. There was a bidding process, and Housing and Urban Development would give weight to a non-investor- they really want people to buy and live there to help the community. I put in my bid at around $85,000 I think, and it was rejected. By this point, I was positive that this was the house for me- close to downtown, easy access to the freeway, close to the Fair Park (not that I’ve ever been to the Utah State Fair), grocery stores, a few little parks… and the price was unbeatable. I was a stress case during the next few days as I waited to see if they’d accept my next bid, $93,000. In retrospect I was probably a little over zealous and should have bid at a flat $90,000. Nevertheless, my bid was accepted and here I am. Figuring out financing was the next step. I had already been preapproved for $190,000- can you believe that?? That kind of payment would have literally taken up my entire paycheck! I thought the housing crisis was on it’s way out! Anyway, Jonny and Matt and I made a list of things that would have to be fixed or replaced.We first had to figure out what was eligible to go on the loan and what wasn’t.

ELIGIBLE IMPROVEMENTS INCLUDE
1. Repair/Replacement of roofs, gutters and downspouts
2. Repair/Replacement/upgrade of existing HVAC systems
3. Repair/Replacement/upgrade of plumbing and electrical systems
4. Repair/Replacement of flooring
5. Minor remodeling, such as kitchens, which does not involve structural repairs
6. Painting, both exterior and interior
7. Weatherization, including storm windows and doors, insulation, weather
stripping, etc.
8. Purchase and installation of appliances, including free-standing ranges,
refrigerators, washers/dryers, dishwashers and microwave ovens
9. Accessibility improvements for persons with disabilities
10. Connection to public water or sewage system
11. Repair/replace/add exterior decks, patios, porches, sidewalks, driveways
12. Basement finishing and remodeling, which does not involve structural repairs
13. Basement waterproofing, including mold removal
14. Window and door replacements and exterior wall re-siding
15. Septic system and/or well repair or replacement

INELIGIBLE IMPROVEMENTS INCLUDE
1. Major rehabilitation remodeling, such as the relocation of a load-bearing wall
2. New construction (including room additions)
3. Repair of structural damage
4. Manufactured Home foundation repairs / upgrades to meet HUD standards
5. Landscaping or similar site amenity improvements, including fence
6. Any repair or improvement requiring a work schedule longer than three (3)
months; or Rehabilitation activities that require more than two (2) payments
per specialized contractor. That would necessitate a “consultant” to develop a
“Specification of Repairs/Work Write-Up”
7. Repairs requiring detailed drawings plans or architectural exhibits, or require
a plan reviewer
8. Result in work not starting within 30 days after loan closing; or cause the
mortgagor to be displaced from the property for more than 30 days during
the time the rehabilitation work is being conducted. (FHA anticipates that, in
a typical case, the mortgagor would be able to occupy the property after
mortgage loan closing)
9. Lead-based paint stabilization or abatement of lead-based paint hazards.
Although HUD allows this, the Lender does not participate in this at this time.

I will try to find the detailed plan that we submitted to the bank, but the main things were approximately:

New Roof: $6000

New Furnace: 1800

Carpet: $800

Water Heater: $500

Paint: $1500

New Appliances (there weren’t any): I can’t remember

We ended up deciding that we would need about an additional $18,000, making my full loan amount approximately $111,000. Not bad for a house in Salt Lake. There was one down the street for sale when I was looking, listed at $150,000. It wasn’t awful like mine, but it was very dated and oddly put together. And mine, for $40,000 below that, will be a brand-new adorable abode! Stay tuned to see what all I’ve (we’ve) done so far.

Here’s a sneak peek:

Where to begin??

Where to begin??

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