Sorry I’ve been so quiet this week, folks. But I’m happy to say that we FINALLY have the contractor thing sorted out. And it only took three weeks of back and forth.
Having settled it all up on Friday, I decided to have a nice, quiet Saturday and didn’t even get online until late evening! For me, that’s completely unheard of.
The first company
This was the company that wanted to charge us $112 for smoke detectors. Linda, the lady we dealt with, kept piling on costs and saying it was mandatory: shower heads, smoke detectors, appliances, etc.
The thing is, according to her, it all had to be addressed in the bid or it wouldn’t be approved by our underwriter. So, she said, the money had to be taken out for, say, a $688 fridge/installation. But if we bought one for less, the extra would be applied to our principal.
Sounds good. Until you realize that we’d still be borrowing about $30,000. That means our payments would be based on $90,000. It also means the house would have to appraise for that much. Which made our realtor nervous.
Here are some of the ridiculous things she told us:
We told her we’d just deal with the shower heads ourselves. We got the speech about it being addressed in the bid. So she’d just put us down for the installation. Which was about $10, she said. Something about having to have an actual plumber come and put them on.
It would have been fine if she’d left it there. But she later referred to it as saving us the work. Of installing a shower head. I actually repeated the phrase back to her, I was so incredulous.
We told her we’d found them $8 online, and so would just buy them ourselves. She said she’d give us an allowance (the detectors had to be addressed, after all) and then charge for installation.
After the shower heads discussion, I didn’t have the heart to ask what that would run.
I already mentioned the $688 fridge (two, actually, counting the guest house). Apparently, it wasn’t a $688 fridge. That figure included a 10% markup from their cost to buy it, plus $100 to install.
I double-checked with her. All that needed to be done was to get the fridge in and plug it in. $100.
We said we would pay out of pocket and find it cheaper. She said she’d just give us the allowance again and then we’d just pay the installation and the markup.
Yep, the company would charge us 10% of the cost, even if we did all the research ourselves and found the cheapest unit, had it delivered, etc.
Wall-mount air conditioner
In the guest house, we wanted to put a wall unit back in. The bid was $966 — $600 for the unit and $366 for installation.
First of all, the unit would cool 485 square feet. That would be nearly $1.50 per square foot. No way that was a reasonable price. I told my friend in Florida the price, and she cracked up.
Second, the $366 was the cost to install the unit in a pre-cut hole. I checked online, and it was a very simple process. You put in the unit, use brackets (which come with the unit) to secure it. Then you put weather stripping around it on the inside, and you caulk around the outside.
I’m sure there was more and I’ve just blocked it. But those were the worst of the silly charges.
What really gets me, though, is that the numbers were so overwhelming (and the logic so ludicrous) that I missed a huge, glaring detail:
We kept telling Linda we wanted to pay out of pocket, and she kept putting the allowances in the bid.
In other words, no matter how much we told her we wanted to pay for it ourselves, she kept putting the costs back into the bid, thereby insuring her company got paid a nice markup/installation fee.
I don’t know if it was (willful) stupidity or just avarice. Either way, she misheard us too many times for it to be a misunderstanding. Either way, we were getting screwed over. We just didn’t know how badly until we did the walk-through with the second company.
The second company
The next day, we met with Marty, from the second company. I asked why no appliances were addressed. Or shower heads.
He confirmed that it was necessary to have those items in order to get FHA approval. But that inspection could be done after the work was done. So, if we didn’t manage to get some shower heads installed before the inspection date, he’d go to Home Depot, buy some and install them — and take the money out of contingency funds.
But, we pushed, we didn’t need to address every single FHA-necessary item in the bid? Nope.
Oh, and he pointed out that FHA doesn’t require a fridge. Just a stove and oven.
In case you worry that this guy was cutting corners, our realtor assured us he was fine. She had spent a few hours with him earlier that day at a different property. There, they did a walk-through with a lady that our realtor called an FHA guru. As in, she’s done tons and tons of these 203k loans. And she agreed with everything Marty said at that property.
That was enough for us.
Linda, ready your blame deflection!
A couple of days later, I got on the phone with Linda. I explained, as best I could, our conversation with Marty. It was a little muddled, I think, because I was getting “bank underwriter” and FHA inspection confused. Mainly because Linda had kept making it sound as though an underwriter were going to walk through the property and check things off the list, just like an FHA inspector would do eventually.
When I got to the part about the fridge not being necessary, there was a slight pause. Then she said she was pretty sure she hadn’t told us it was necessary.
Um, yes you did.
No, she said, she was pretty sure she hadn’t.
Yes, you did. You told us that all appliances we asked about were FHA necessary or it wouldn’t get approved.
Seizing on that, she said it was the BANK that made that all necessary. She couldn’t change that. She was just going by what the bank would require. The fact is that, if there’s a hole in the house, it needs to be —
And there she cut herself off, probably realizing she was about to confirm that she had, in fact, said a fridge was necessary. So she changed her tack.
Why wouldn’t we want to use the funds to buy a fridge, anyway? (Cue: My head threatening to explode.)
BECAUSE, I said, we want to pay OUT OF POCKET. We don’t want to amortize the appliances over 30 years! And we can find them a helluva lot cheaper than you can, apparently.
We went back and forth a little more, with her blaming everything on either my misunderstanding or the bank or both until I was on the verge of screaming at her. At which point, I told her I was going, and I hung up.
For the record, both Tim and the realtor heard the same thing I did. Just sayin’…
And that’s that
Needless to say, we’re going with Marty. That’s not to say his company didn’t pad things. They wanted to do some work on the patio roof that would have added an extra $4,500 to the bill. That’s in addition to $4,000+ for other parts of the roof that need work.
Linda’s company didn’t recommend that expensive option. But we didn’t want to use her. So we got a third opinion — a roofer who doesn’t usually do these loans. His bid: $3,870 for everything.
We hired him to do the roof. The rest will go to Marty’s company. And Tim has begged for the privilege of telling Linda just where she can put her bid.