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Tuesday, August 12, 2008

Closing Day for our Construction Loan

Today was the closing day for our construction loan! Finally!! After at least 5 different investors have worked through their vacations, illnesses, and paperwork, we now will have money to build!!

I think I know what you are thinking. "Ummm . . . You have been building. Where did you get that money?"

Before I answer that, let me give you a little background on our finances.

Early on in our marriage, Ethan and I learned the difference between needs and wants and how to scrimp and save. (Even though I'm sure we have much more we can learn.) The first year we were married I was finishing college and Ethan was a youth director in a small town church. After I completed my last year of college, we both went to work at Cono Christian boarding school.

The first year we worked at Cono I earned $6500 for the year. Ethan's salary was less than $9000. And that's before taxes. The second year we each got a slight pay raise. So we really didn't have a lot of cash to do as we pleased with, and we learned even more how to save money.

Granted, we didn't have to pay housing. We got to share a house on campus with 6-8 high school boys. We also didn't have to buy our food. We were free to . . . errrr . . . required to eat all of our meals in the dining center. So right there we learned that we didn't need to have an extravagant house or eat extravagant food.

Also, since we needed to be on campus 24/7 during the school year, we learned how to entertain ourselves without spending money. One of our favorite things to do was to go shoot guns across the road by the sewage lagoon in the field. (See what I mean by nothing extravagant!) Also, the only time we really ate out was when I was expecting Caleb, and we got to leave campus for my appointments.

As for the summers there, the first summer we were moving in and the third we were moving out - so not much time to run around spending money in the summers either. And for the summer in between, we re-shingled my parent's house and garage, resided the house, and helped them get started on their addition.

After we moved from Cono, Ethan took another youth director position, and I became a stay at home mom. Ethan's salary increased a bit from what he made at the boarding school, but since my salary disappeared when I became a stay at home mom, things pretty much evened out. So we continued to find ways to cut expenses and stretch the penny.

We knew from the beginning of our marriage that if we wanted to move out to the country we would have to save hard. So that is what we have been doing the last 7 years. We also knew that we would probably never be able to afford big loan payments, so we saved until we could have some cushion and flexibility to help keep our loan payments low.

Which brings me back to the question. Where did our building money so far come without our construction loan? Well . . . we have been spending the cushion we have saved up the last 7 years, and we have never been so broke in our marriage before! I have been carefully monitoring our budget though and keeping in contact with the lenders. Now that the loan is here, we will turn in our bills to be reimbursed for what we have spent and continue with the project.

We are so thankful that we were able to have that cushion when we started this project. If we didn't we would JUST be calling our builder to let him know we were ready for the building to go up - and we probably wouldn't have been able to start work inside until November. We never imagined that it would take over than 3 months for our loan to close. (Not including the 2 months of talking to the lender prior to submitting our information.) So although the 7 years of saving up seemed like it would never end, it has definitely helped out.

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 Tools of My Trade
This kit is one we have used and is worth every penny you will spend on it! Even if you have a good grip on your finances, there will be things you can take away from this study that will be a blessing to you.  As Mr. Ramsey says in his radio show when it comes to figuring out how big of a mortgage you should take out on a house, "You want your house to be a blessing, not a curse."  I believe that this advice fits with all purchase that are made.  In addition to not having them be a curse by needing to make payments, we also need to keep them from becoming curses down the road by using up money that could have instead been set away for emergencies or more important purchases.  This plan helps you figure out how to budget your money in a way that you will move more and more from finances becoming a curse in your life to more and more of them becoming a blessing.

If you just want a very helpful, but not as in depth version of Mr. Ramsey's financial advice, the Total Money Makeover is another wonderful resource. We have a large number of friends who have used this book to help turn their finances around. You may be able to find a used copy of the book through e-bay or You can also pick up a new copy from the link below.

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