Tuesday, July 19, 2016

The dreaded "F" word...

You know that word, right?  No...not the four letter variety.  The five letter variety.  The one that sends home buyers running for the hills.


At the beginning of the appraisal process the lender, however their process works (which we inquired about but never really did get a straight answer about), initially determined that we were in a floodplain and would require flood insurance.  Initial estimates on our property ranged from $500-650/year (from my insurance agent, but without doing any research) to $800-1200/year (from Floodsmart, the federal website that tells you everything you need to know about reading flood maps, what to do next if you find out you are in a floodplain and also offers flood insurance) and up to $2500 a year from someone else my husband quoted.

What we did know was this....at the median level of these quotes - around $1200/year - that meant an additional $100/month on our property that we just really did not want to pay.

In a lot of ways, this property is a bit of a stretch for us.  There is a lot we're not giving up to acquire this property, but there is a lot we will give up to get it.  We also know there's a lot we are getting in return.  Quality time with our children each weekend on a much slower schedule, extended visits with my mother-in-law each summer which will mean so much not only to her, but also to our children and us who miss her terribly after she moved out of state a few years ago.  It also gives us the opportunity to flex a few of our DIY muscles, which is one of our biggest hobbies.

But an additional $100 a month is a lot of money, any way you slice it.  It ramps our payment up to a level we weren't comfortable with.  Another way to think of it - that is $100 worth of fewer improvements I can make to the property each month.  So my husband had pretty much made up his mind - we were walking if the final determination was that the house was in a floodplain.

Luckily, we questioned the lender about their process, they went back to the people that made the initial determination and after reviewing everything, did ultimately decide that the home was not in a flood plain.

I'm sure it's a common scenario...I mean, it is a lake house, after all.  And we had some pretty gnarly flooding here even last summer.  The flood would have to be pretty bad to actually reach the home.  It sits on the lot in such a way that the property is in the floodplain (as any lakefront property would be) but the actual structure is not.  We have a few good feet in front of it to spare.  Granted, it's a risk and we do understand that, but we feel pretty confident in not having insurance required.

So, we press onward.  I will admit that this process has been stressful and seems like it has taken forever, but we are *so* close to being there.  We anticipate a closing in less than a week!  I can't wait to share more details about the home and some pictures as well!

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