financing site purchase | <– Date –> <– Thread –> |
From: Judy Baxter (BAXTERepivax.epi.umn.edu) | |
Date: Tue, 23 Feb 1999 17:14:29 -0600 |
RE purchase of land with a building- A little info, since I suspect we are one of the few groups who have done this - i know there are others. <<Greetings all. We are in the early stages of forming a group (check out www.arcadia-farm.org for more info). I'm looking for information from groups who purchased land with an existing house on it (in our case, it'll be used as the common house). How did you finance your initial purchase?>> We bought a building to use roughly half as Common House, half with 8 coop apts. It's a long story - we spent about 8 months hoping another buyer's deal would fall through, then we thought it was lost to us, then 4 months later we had 6 weeks to put it all together. Somehow, we did have 8 households ready to buy, tho one was buying as an interim measure till we could build the townhouses. So about 80% of the down payment came from those 8 hh, the rest came as loans from members planning to buy townhomes. We financed the whole building and land as a coop. <<How many families were involved at the time, vs. how many now? Did taking the initial risk translate into any financial benefit for the founders down the line? How did you make this "fair?">> I think 12 households then, 15 households now. No benefit for the founders, I guess it *isn't* fair, but I suspect it was because we didn't want to make things any more expensive for the rest of the community. I suppose we could have been more fair, but then I suspect i wouldn't be living in cohousing -- i.e. i don't think we would have gotten a construction loan. or had a community. <Did your sellers carry a contract for all or part of it? What were the terms? No If you worked with a conventional lender, who was it and what would or wouldn't you recommend about going with them in the future? N/A Did you have some members live in the existing house, at least temporarily? How did you pro-rate who paid what on the land mortgage? We moved in over the next 2 months, and lived with the rehab for the next 3-4 years. Pretty amazing. the residents paid the entire mortgage, and eventually (it's more complicated, but to simplify) the townhome buyers bought their land from the coop. $ went toward development costs for the whole project. Did you have a problem with getting your land lender to have a subordination agreement (whereby the original land loan becomes subordinate to people's individual unit mortgages? not sure how it works, not on legal team Hope this helps - Judy Judy Baxter, Monterey Cohousing Community,(MoCoCo) Twin Cities Area, Mpls.,MN -- e-mail: baxter [at] epivax.epi.umn.edu (usually checked on Monday, Tuesday, and Friday) 15 homes - 7 new townhomes plus 8 coop apartments in a rehab Georgian building (built as a retirement home in 1924 -) which also serves as our Common House ---------------------------------------------------------------------- Two 3 BR townhomes for sale - see our web page ---------------------------------------------------------------------- Voice Mail for Monterey Cohousing - 612-930-7554 web page: http://www.jimn.org/mococo/
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