It seems so long ago that we were trying to get a mortgage for this house that it is hard to believe it has almost been a year since we were approved. It really was a very difficult task getting our mortgage from a Puerto Rico bank. You see, because the house was under construction, no bank would give us a traditional mortgage. They all wanted to give us a Construction Loan (if at all) which would have racked up a 17% interest rate along with hazard insurance, progress reports to the bank and check lists which we would be required to complete on the monthly basis. It was serious stuff, and as this is our first construction venture, we weren’t ready for that type of commitment.
After much research, dozens of phone calls and emails, we got in touch with a Puerto Rico mortgage company which would grant us our loan (traditional, 30 year fixed rate at 6%) but they had a few stipulations to ensure we finished our house and didn’t take the money to the Bacardi factory in San Juan and drown out the noise of our newly purchased generator with rum. They required us to give them about 20% of the homes value in an interest baring CD account with them that they would hold for two years (we make the interest, but our money is tied up) and another 12% as collateral that we would finish the construction to their specifications. It was a bit of a shady situation, but after 6 months of trying for a mortgage (with impeccable credit and a large amount of money saved) we decided if we wanted to buy the Sector Vargas property we were going to have to trust the Puerto Rico mortgage company that would sell our mortgage to Banco Popular as soon as we closed the deal and they made their commisions.
Well, after giving the bank most of our cash/savings, we had to spend our present income on completing the house. This gave us a monthly budget (which we somehow managed to exceed on the regular basis) to complete our bathrooms, kitchen, flooring, electrical, plumbing, excavation etc. Well, come January, we had to hold off on dumping money into the house so we could pay taxes (we are both business owners so the tax man is always a bit of a mystery to us until our fiscal year is done).
Because we exceeded our monthly budget, I spent a good portion of my tax savings on the house, and realized that in order for me to make my taxes on time without penalty, the bank was going to have to issue us our Certificate of Occupancy which would lead to a refund of our initial deposit (about 12%). Summer knew we were going to make it just fine, but we hadn’t finished all of the required items on Banco Populars Popular Mortgage to-do list so I started going into the bank about a month ago telling them that the economy isn’t what it was and that I shouldn’t be required to complete all of the things they want me to do to the house. I talked them into sending an inspector out to the house, and with some well placed barking dogs, the inspector saw everything he needed to see to approve our Certificate of Occupancy!
Banco Popular / Popular Mortgage issued me a refund check on Friday, ten days after approving our Certificate of Occupancy.