We went to the Title company in Marinette this afternoon. The land is now OURS. Yay!
My husband and I have decided that we want to document everything about this process to show what it is costing us to move out to the country and set up a homestead. We entered into this knowing that friends and family have spent excessive amounts of money and taken out atrocious amounts of money in loans and mortgages. This was considered normal. That’s not our normal. We don’t want to end up paying $180,000 for a $100,000 loan that dictates what we have to build, where we have to build it, who we have to hire to build it, and when we have to finish building it by. We don’t want a 30 year mortgage. We don’t even want a 15 year mortgage. After looking at how much you will pay when all is said and done on a mortgage contract, it blows my mind that there are so many people willingly signing up for them just so they can have a decent house.
Our goal was to purchase the land using cash, then build the house as funding became available. We talked about getting a construction loan, but no banks were willing to let us do the building ourselves – we would have had to hire a contractor and hire out almost every step of the building process. Not only that, but we would have to play by bank rules and wouldn’t be able to use a sawdust toilet or anything deemed un-sellable in the future market. The rooms would have to be a certain size, the materials would have to be all new, and everything would have to be finished by the end of 1-2 years. We’re not building a typical house, and we sure aren’t going to be finished within two years.
Instead of paying all of our savings for the land, we offered to put $10,000 down and take the remaining $19,900 on land contract with the previous owner. He financed us at 8%, which seems steep until you hear that it’s only a 4 year loan. Our payments are completely flexible since we are working with a person instead of an institution. To pay it off in 4 years we would have to pay $440/month, but since we are dealing with a person who understands that circumstances change over time, we are allowed to pay just $200/month until we are out of our apartment and can snowball that $600 payment into the balance against the land. Doing it this way, we will have it paid off well short of the 4 year mark.
That left us with $10,000 in savings to start on the house. We had initially estimated that it would cost us ~$1000 for a 200′ driveway, $1000+ to get electricity to the site, $4000 for a septic system, $2500 for a well, and $1000 to pour the footers for the house. That spoke for almost the whole savings amount, but we’ve had some great news – our estimates were rather high! So far the best quote on a driveway is $600. And the electric company just mailed us a quote saying that it will cost us $2200 for overhead wires or $400 for buried. Bring on the buried cable! The best news of all, though, is that Wisconsin will not force us to install a septic system. They actually accept sawdust toilets as a sanitary system. Even the permits for sawdust “privies” are cheaper than the permits for a septic system. So that brought our sanitary expenses from $4000 down to, what? $5 for a top o’ the line pair of buckets plus $10 for a truckload of sawdust? I’d say that’s a deal.
This weekend we plan on installing the batter boards to square out the corners of the house site. We can’t start digging until we get the actual permits in hand, but we’re excited to have something to start with! I will be keeping this blog updated as we move along. We plan on keeping detailed records of our expenditures and projects on this blog, so keep checking back throughout this next year for updates.
Oh, one more note. The previous owner of the property not only paid his share of this year’s taxes on the property, but did a title search for us. I’ve been told having Title Insurance is key when you are purchasing land, so this was a good sign that we purchased land from a reputable man. He took care of all the little details and made this process very fast and pain-free. If anyone is looking to buy land in Northern Wisconsin, I have a great recommendation to give you.