Okay, I'm at a loss as to what to do here. The bank that we've been working with on securing a pre-approval for our house and studio build has come back this morning and said they there are not comp's available in the market on which to gauge this "studio" build. My build thread is here.
So...they said that since there aren't any comp's in the area and they're not sure what's going to happen, they are going to require 10% on the entire project. I don't have that kind of money just laying around. I told them that it's technically additional living space and that it can be considered a guest house since it has a full bath in it. They, evidently, didn't understand that too much and said that they weren't sure how the numbers were working out.
So...I'm kind of between a rock and a hard place. I have sold my current house already and close at the end of this (October) month. Right now, we don't even have a pre-approval from the bank just because of this freakin' studio!
Advice, please???
Bank says no comparable comps for appraisal...
Originally posted at johnlsayers.com, topic 13698.
Personally, I think I'd change banks! Clearly, the one you are working with right now doesn't have a clue and isn't interested in your business, so I'd try another.
Maybe you could bill it as a home theater / music room rather than a recording studio?
- Stuart -
I appreciate the reply, Stuart. Problem is, most or all of the banks around here are going to have that attitude. There's not a single recording studio in my area that is built to this kind of spec. Let alone an appraiser that knows what it is. My biggest fear is that the appraiser is just going to see it as a shop and value it REALLY low. In which case, the bank won't finance it. See my issue? The appraisal has to come in at my asking loan amount or I'm hosed. The only thing I can really think of is calling it a guest house. It's going to be heated and cooled and also have a full bath. That's the ONLY thing I can think of to do...however, what will they say about the room shapes in that case? My other, and least favorite for obvious reasons, is to just have my builder put up the outside shell...that being the brick, rafters, roof, plumbing, etc. Then me going in and finishing the inside myself after everything is taken care of. I'd probably try to buy my supplies (or what I can) directly from my builder so I can get a good price. But, with me working solo, that would take a long while to finish. Plus, I'd have to learn everything as I go.Personally, I think I'd change banks! Clearly, the one you are working with right now doesn't have a clue and isn't interested in your business, so I'd try another. Maybe you could bill it as a home theater / music room rather than a recording studio? - Stuart -
Room Shapes should not be revelant - that's a matter of taste and artistic design....... BUT - a guest house HAS to have natural light - means of egress windows for sleeping - living room, etc., etc.,,,,,,,,,, I would simply either call it a home theater - or wait and do it afterwards......... RodThe only thing I can really think of is calling it a guest house. It's going to be heated and cooled and also have a full bath. That's the ONLY thing I can think of to do...however, what will they say about the room shapes in that case?
So, Rod, in other words....labeling it as a guest house would require me to add in things that would not be conducive to a studio design and probably cause me to spend more money treating those areas and more headache? As far as labeling it a home theater...I think I'm back to them saying "there are no comparable's in the area to gauge the value". Great book, by the way.Room Shapes should not be revelant - that's a matter of taste and artistic design....... BUT - a guest house HAS to have natural light - means of egress windows for sleeping - living room, etc., etc.,,,,,,,,,, I would simply either call it a home theater - or wait and do it afterwards......... RodThe only thing I can really think of is calling it a guest house. It's going to be heated and cooled and also have a full bath. That's the ONLY thing I can think of to do...however, what will they say about the room shapes in that case?
If it had a 2nd means of egress (could be a door into another room - does not have to be an egress window - why not call it a family room - rumpas room - den? There has to be something they can use for a comp...... RodSo, Rod, in other words....labeling it as a guest house would require me to add in things that would not be conducive to a studio design and probably cause me to spend more money treating those areas and more headache? As far as labeling it a home theater...I think I'm back to them saying "there are no comparable's in the area to gauge the value". Great book, by the way.
Myriad, Can you explain this sentence? Does this mean that the bank only wants to borrow 90% of an estimated value (to cover/compensate uncertainty), hence you have to have 10% somehow yourself?So...they said that since there aren't any comp's in the area and they're not sure what's going to happen, they are going to require 10% on the entire project. I don't have that kind of money just laying around.
Well, it has doors going into all the rooms. The live room will have two doors. One going to the airlock and the other going to the smaller live room/iso. The control room will have one door going to the airlock. Then the airlock exists into the lobby. Of course, none of these interior doors allow for any natural light. The one room or rooms that will allow natural light are the office, lobby, and maybe the bathroom. Would this be enough? I'm calling another bank today to see what they say. I'm going to tell them it's a home theater/den/rumpas room and see what they say.If it had a 2nd means of egress (could be a door into another room - does not have to be an egress window - why not call it a family room - rumpas room - den? There has to be something they can use for a comp...... Rod
Correct, I think. For example, if the entire build (including house) is 500,000 then they are wanting 50,000 in cash straight from us as a down payment. They would then consider doing a home loan on the remaining 90%.Myriad, Can you explain this sentence? Does this mean that the bank only wants to borrow 90% of an estimated value (to cover/compensate uncertainty), hence you have to have 10% somehow yourself?So...they said that since there aren't any comp's in the area and they're not sure what's going to happen, they are going to require 10% on the entire project. I don't have that kind of money just laying around.
Thanks for explaining. In our way of thinking and how our banks work, they will never loan 100% of the real cost, unless either someone else stands additionally guarantee for such a loan or you stand guarantee with some other additional possessions, or your income must be very high and/or they expect an insurance for loss of income. This is not new with the crisis, it"s been always that way. A bank here estimates the value of a house with a forced sale (hence, when one gets in trouble with payments the bank can sell it in a public sale on very short terms and still expect their money back). With my background here getting 90% (without other guarantees than what you're loaning the money for) is a very lot, and certainly for special things as studios or other things with a limited or unsure market. Therefore I even thought I misunderstood your question. When you describe it for some other (cheaper) purpose than the square feet price will most likely become lower than what you really need. Hence getting 100% of a lower value doesn't help you much.Correct, I think. For example, if the entire build (including house) is 500,000 then they are wanting 50,000 in cash straight from us as a down payment. They would then consider doing a home loan on the remaining 90%.Myriad, Can you explain this sentence? Does this mean that the bank only wants to borrow 90% of an estimated value (to cover/compensate uncertainty), hence you have to have 10% somehow yourself?So...they said that since there aren't any comp's in the area and they're not sure what's going to happen, they are going to require 10% on the entire project. I don't have that kind of money just laying around.
It's not at all uncommon for banks to loan 100% of the amount, depending on someone's credit history. However, if you don't have at least 20% (I think that's the amount), you get what's called PMI added on. It's an additional charge until you clear the 20% hurdle so the banks can basically get as much from you as they can in case you default on your loan. There are ways around PMI, though. With my last house, we didn't have 20%. We had some, but not 20%. So we borrowed money to get to 20% and then put that on the home loan to avoid PMI. Anyway, it's a lot of mumbo jumbo garbage that I don't really get. Back to the regularly scheduled program!!!! :D Still waiting to hear back from bank #2.Thanks for explaining. In our way of thinking and how our banks work, they will never loan 100% of the real cost, unless either someone else stands additionally guarantee for such a loan or you stand guarantee with some other additional possessions, or your income must be very high and/or they expect an insurance for loss of income. This is not new with the crisis, it"s been always that way. A bank here estimates the value of a house with a forced sale (hence, when one gets in trouble with payments the bank can sell it in a public sale on very short terms and still expect their money back). With my background here getting 90% (without other guarantees than what you're loaning the money for) is a very lot, and certainly for special things as studios or other things with a limited or unsure market. Therefore I even thought I misunderstood your question. When you describe it for some other (cheaper) purpose than the square feet price will most likely become lower than what you really need. Hence getting 100% of a lower value doesn't help you much.
Alright, heard back from bank #2 today. It's not good news and I think I'm going to run into this issue no matter what I do. This area just doesn't have any comparable things for this type of construction.
So....
I have decided to do the build out myself and let my builder simply construct the outside shell.
So...what else can I have him do for me that will lessen the load for me?
I know I'll be wanting an office and I know where that will be so should I go ahead and have him install the window for it?
Should I go ahead and have him install the main door?
Should I have him go ahead and do framing on the inside of the building all the way around the perimeter?
Should I have him put in the insulation in that framing?
Should I get him to get me started on electrical by installing a box?
Should I have him do anything with relation to HVAC at this point?
Should I get any supplies from him for the build out?
What other things should I have him do that aren't really impactful on the studio part of the build?
Any specifics about the concrete slab or brick?
I'd really like some help here...pretty please? :? :shock: :mrgreen:
No one? :cry:
Yes, Yes and Yes.
If it's covered in the loan, get him to do the outer shell, electrics and basic structure of the HVAC.
Also if he can get trade prices on insluation and dry wall...yes to that as well.
By basic structure of the HVAC...what do you mean there? Also, for electrical...how should I go about telling what he should do? I mentioned 3 phase electrical and he said that's normally only done in commercial building. Should I force it or will I be alright with 2 phase? Put the HVAC and all other junk on the 2nd phase and then put all my studio stuff and live room outlets on the 1st phase...? I just want to be able to go back and tell him something. Also, how do I determine how many ton HVAC system I need? Right now, my builder and I have discussed a 2 ton variable speed system. Building is to be approx 1400 to 1500 sq ft. I haven't added up all my total wattage consumption yet because I haven't totally decided on all my gear yet.Yes, Yes and Yes. If it's covered in the loan, get him to do the outer shell, electrics and basic structure of the HVAC. Also if he can get trade prices on insluation and dry wall...yes to that as well.
I would reccomend going with an AC unit twice the size you need, so if they reccommend going with a 2 ton unit, I would go with a 3.5 or 4 ton. It will run less often and be much more efficient at cooling the space. This will ensure that it is on less, so less noise in studio from AC. I realize that it has been some time since you posted this, so you may be well beyond this point at this time. Please post an update if you have, I would be interested to see how things are going.
Although it would seem intuitively to be good, that actually isn't a good idea at all, since the cycle time will be too short to dehumidify the rooms correctly. You should only go with the correct size unit for the job, after doing all the calculations. - Stuart -I would reccomend going with an AC unit twice the size you need, so if they reccommend going with a 2 ton unit, I would go with a 3.5 or 4 ton. It will run less often and be much more efficient at cooling the space.
Well, because of some issues, we haven't even started yet. I actually switched builders and just purchased a lot at another location. Better location IMO.
Anyway, we'll cross that bridge when we get there. I have a thread going with another title that I'll be updating for the build.
Did not think about dehumidification at all!!!! Great point. what about..... never mind....... I was going to ask about seperate dehumidification, but seems that it would only add some issues back in. How would you recommend eliminating AC noise in the recordings? Turning the unit off and on between takes, seems like it would waste a tremendous amount of power, and would be something that I would undoubtedly forget to do half of the time.Although it would seem intuitively to be good, that actually isn't a good idea at all, since the cycle time will be too short to dehumidify the rooms correctly. You should only go with the correct size unit for the job, after doing all the calculations. - Stuart -I would reccomend going with an AC unit twice the size you need, so if they reccommend going with a 2 ton unit, I would go with a 3.5 or 4 ton. It will run less often and be much more efficient at cooling the space.
Alex, you are mistaken - oversizing an hvac unit does not make it more efficient (never mind much more efficient) - it makes it MUCH LESS efficient. Oversized HVAC systems have short run cycles - which means you are paying more for electrical costs because you are starting the compressor more often (this is the time of the greatest load on the compressor) you want long run times to make the costs as efficient as possible. BUT - cost aside - there is another piece of this that oversized equipment screws you up on - and that is humidity levels. Because of the fact that you have short run times - you do not have proper dehumidification within the structure - again you need long run cycles to make the systems work properly. Systems should always be sized properly - and you also have to take into account what the systems provides in sensible versus latent cooling to determine which system to install - and for that you need to calculate the proper use of the spaces. Both fresh air and people release humidity into the air - and those humidity sources have to be taken into account. And (as far as the people go) they release much more humidity if they are playing their asses off than if they are sitting at a desk mixing. Sincerely, RodI would reccomend going with an AC unit twice the size you need, so if they reccommend going with a 2 ton unit, I would go with a 3.5 or 4 ton. It will run less often and be much more efficient at cooling the space. This will ensure that it is on less, so less noise in studio from AC. I realize that it has been some time since you posted this, so you may be well beyond this point at this time. Please post an update if you have, I would be interested to see how things are going.