February 14, 2013

The Refinance

Feast Master Deconstruction

One of my big goals for 2013 was to refinance our house. The first thing I did was to reach out to our credit union to get an estimate on how much a refinance would cost and whether we could qualify. With assurances in hand and a bit of a steep bill, we started gathering the money we would need. One of the things the bank emphasized was that we should not have any unfinished construction projects.

Hmmmm…so what about that Feast Master? When we bought our house it had a swanky basement den, complete with carpeting, a shag lined bar and an in house bar-b-que, brand name “Feast Master”. The Feast Master did not vent into our chimney, but instead vented directly into the driveway. Our home inspector told us to never use the grill, if we didn’t want to have a house fire. As we learned our first winter, this also meant that cold air rushed through the vent and right into our house.

Last fall, SB started the demolition work to remove the Feast Master. It was hard, dirty work, breaking down the masonry and removing the bricks. Progress was slow and the priority was low, after all it was just our bonus basement room and not essential to our daily lives. However, it was certainly a construction project in progress. SB made a big push in December and January, breaking down the whole fireplace and hauling out the rubble.

Once we felt good about the Feast Master, I moved ahead with getting the home assessor to come in. I had no idea what to expect. He came in with the approach that any and every change we made to the house should count towards overall value and he also wanted to know if I had put together a comparable properties list. Had I known that I should provide him with a packet of improvements and comps, I would gladly have done that. I had been under the impression that the home owners were not supposed to influence the assessors with that type of information. I wasn’t even sure I would be allowed to talk to him.

The assessor poked around the house, asked his questions and made his report. In the end he determined that our basement den was now unfinished space, but that the total value of our house was still more than we paid for it two years ago. If we had left the Feast Master half finished, I’m not sure how that would have influenced the evaluation, if at all. How were we to know?

Yesterday we closed on our new home loan. Our old loan was a 30 year loan, at 6% with a 5 year arm. Our new loan is a 15 year loan, at 2.6% fixed rate. 2.6% !!!! Say what!?! Based on my estimate, over the length of the loan, refinancing is going to save us $258,000 in interest. Boom! Plus, we will own our home in 15 years, which sounds like an imaginable point in the future.

I’m really glad we moved ahead with the refinance. Now we just need to put some more time in to bring our basement den back to the land of finished, livable space. This includes, re-doing the stairs, replacing the windows, putting in new carpeting and painting the walls and ceiling.

Feast Master No More

1 Comment

  1. That rate is amazing! Good for you! And I’m glad the Feast Master didn’t affect your value. Having did a refi last year, I’m glad you didn’t have to go through the assessor from hell like we did. We were told to have a short but sweet list of the major things we improved to the house and not to bother the assessor – although in our case that didn’t seem to help.

    Comment by Rosemarie — February 14, 2013 @ 7:46 pm

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