A bit off topic but I thought I'd share...

As most of you know, we are moving to NC this summer. We needed a loan for two reasons:

1) Our current house will not sell until after we move (or at least we won't have the proceeds until after we move)

2) Most of our savings is tied up in tax-deferred accounts and taking it out all in one year would cause a massive tax bill

So we applied for something called a C2P loan (Construction To Permanent). Basically it's where you have one loan closing up front before the house build starts, then the builder request draws as they complete parts of the house, and your balance reflect these draws. So the loan amount starts out small and then increases as they get more of the house built. During construction you're only REQUIRED to pay interest...but we are paying much more. Once you move in, it automatically converts to a longer term loan (you can select from options...we selected a 3-year ARM...the shortest you could get). This will allow us to get the funds from our house sale in Indiana, and take some from our TIRA (just enough to not trigger a large tax issue) each year, and get the entire house paid off in about 2.5 years.

Now here's the funny part...

The bank initially declined our application due to insufficient income. We are both retired, we are not yet collecting SS (waiting until age 70 so we can do Roth conversions), and the only income we really have is a small (about $1,400/mo) pension from an old employer. Yes, our Roth conversion shows up on our tax return as income...but they would not count that.

So...we had to go back and give them all our statements from Fidelity showing that we had substantial assets in our retirement accounts...enough that we can manage the payments once it converts to a 3-year ARM. We had to write a special letter and ask them to do "manual underwriting" so that our "low income" would not cause us to be turned down. It was a lot of extra work, but in the end it worked out. We actually had to set up an automatic transfer from the retirement account to our new bank account at the NC bank and prove to them that we had the auto draw set up for at least the amount of the anticipated mortgage payment once it converts...which we did.

The house in NC is more expensive than the one we're selling, so we'll use our funds from the Indiana sale and have to use some of our retirement savings also. We are currently paying $10k/month just to mitigate the interest-only payments (yes, that $10k is specifically going to principal...we have documentation stating this)...and as soon as we get our Indiana house proceeds we will apply all of that to the loan so that we "move forward" in the amortization schedule. We will then figure out an appropriate amount to pay each month (more than the mortgage amount) and will likely get it paid off in early 2028 after we can do the Roth withdrawal/conversion for that year.

All is good, but beware of this if you're in our situation.

I understand the bank needed proof of ability to pay?

Hope all goes well with your new house.

I see you are putting your financial advisor skills too work.

where did you decide to live?

No Jim, won’t be in Columbus OH