You cannot force a bank to loan you money, you can only *ask* them to loan you money.

The problem is that you have gotten neither a "yes" or a "no" answer. They are keeping you in limbo and preventing you from starting your project.

Tell the underwriter (and the bank's loan officer) that you have provided all of the requested information on your applicatioin, and that you need either a "yes" or a "no" answer by a certain date. Let the loan officer know that if the answer is "no" then you will take your business to another bank.

If the well is the hold up, ask your well contractor to give you a quote of $1750 for installing a 50ft well with any additional ft being $35 per ft. Our current quote is for 200ft with each additional being $12 per ft.

If labor quotes are brought up again, call local subs for quotes, and submit them. You are not required to use those subs, it's just an estimate.

We're awaiting the appraisal for our Owner-Builder Loan, we've been approved as the GC and for the Loan. Closing Date, here we come!

May I ask who you've got for insurance? Not that I want to be doing any of the work on the house, but our insurer will not insure us if we do any of the work ourselves.

Thanks for your responses... We have already been approved for the loan and have a commitment letter. They just won't close until she has said that she has all of the proof that she needs that we can in fact build this house for the amount of funds we have available... We have gone to some other subs and GC's about giving us quotes, but it seems to be very difficult to get them give you a quote and leave out their labor costs. We are not asking the bank for enough money to do this with labor costs, my husband has ZERO interest in letting someone else build HIS house lol. The appraiser has already been out to the land, we were approved as the GC, we've been approved for the money (we aren't asking for much, most of it we have as cash on hand).... Now we're just fighting with her to accept the estimates from the lumber yard.

bdpeck...We're GCing our build and got our Builder's Risk insurance online through Omni. Our regular insurance company could insure us, but the cost was WAY up there since we are not licensed builders. They are the ones who referred us to Omni and gave them glowing recommendations. The price was about 10% of what we were originally quoted.

Here is a link that might be useful: Omni Builder's Risk

We got our Builder's Risk through Peerless... Not NEARLY as expensive as we had budgeted for. It only ended up being $526 for the year. Our insurance agency found them for us.

aewood - i can see your underwriters point of view. What happens if your husband has an accident and breaks his leg or worse. If he can no longer do the labor, then you will have to hire it out to get the house complete.

I am owner/builder on my house and doing a majority of the labor. I had to get bids for labor even on the items I planned on doing myself. I had an instance during framing where I turned my ankle, no big deal until it agravated an old injury and left me in a cast for 8 weeks. My peak is 42' up and there was no way my wife was going to let me on scaffolding 42' up in a cast. So i had to hire some extra help.

bdpeck - I am insured by statefarm and they have no problem with me doing the work myself.

That is a very good point mikeyvon - except that it has been made very clear from day one from them that we did not need any subs, bids from subs, insurance for subs, etc. So to suddenly be caught up by one person who does not understand is frustrating.

Mikeyvon, StateFarm is the company I'm using that won't let me do any work myself. Are you a former contractor?

I talked with Omni, but they wanted 60% more than StateFarm and didn't including any liability insurance.

We did our home almost completely DIY, but still had to budget at least some labor costs past what we planned to need, because of the 'what ifs'. The bank wants to know the home will be finished in a certain amount of time. If they have to take it back from you, they want to know they have something they can sell, not something they need to have built.

It doesn't really matter what anyone down the line knew about your plans not to use subs, because it's the underwriter that is the law-maker on who gets money and what they need to do to get it, and they have to cover the bank's best interest, especially with the state of mortgages now. The requirements have gotten much more stringent in the last months. They are also looking out for you...Making sure you're not underestimating anything, so that you don't get in a bind with the project.

A LOT of people think it's easy to build a house. A LOT of people depend on family and friends who never show up. A LOT of people underestimate the prices of the details or forget to include things. A LOT of people fall and break a leg or get a bad case of the flu at a crucial point and can't finish on time. Banks have been through this stuff before, and you may know you won't have any of these problems, but they would be foolish to assume.

Didn't the bank have forms for you to fill out for the line item expenses and identify which they needed specific types of proof for? I can't imagine that a lumber yard could give quotes for every item that will go into the house? (wiring, plumbing, fixtures, flooring...)

My advice after having been through a lot of this myself, is take a deep breath, and sit down with someone at the bank and find out EXACTLY what they need from you. It seems like such a pain, but there is no harm in both of you knowing as much as you can about potential expenses.

Best wishes...Really, you will get past this and things will be on their way.

Insurance: State Farm is our insurer and didn't have any problem putting the construction rider on our homeowner's policy on our owner-builder project. The only problem we had is that they only wanted to give it for 12 months, and we had ask the insurance underwriter to make an exception when we took longer. That created a lot of worry, caused by the agent's office person who told me they NEVER make exceptions, because, after all, ALL houses should only take 6 months to build, but the underwriter OK'd it immediately.

bdpeck - try another statefarm office. I am in Cali, so things may be different here.

don't get estimate from subs with no labor, get the estimates they would charge IF THEY DID THE WORK. that is all your bank is asking for. i think you are getting confused over the matter.

basically the bank is wanting assurance that IF soemthing were to happen and you could not complete the job, they could get it finished and sold, or at least sold as is, for enough money to cover what you owe and still be able to sell it. banks DO NOT want to own your house. they are in business solely to make money and therefore they must protect themselves while trying to be of service to you.

you may already have done this but please tell me you've taken the number your guessing you'll end up at and then added 10-15%...i had my line item budget very detailed at $90 a sq ft and quickly ended up at $100

We too had underwriter issues. We have a nice income, excellent credit scores, and it took about six months of trying to get a construction loan. The THIRD time this bank sent the loan to committee they increased the construction loan rate by 1.5% and increased the closing costs by $3000. Classy.

The sub-prime mess was started by the government leaning on banks to lend money to the "disadvantaged" who couldn't get conventional financing (because they are a high risk group!) So the banks did it, and the people are defaulting. So banks are in trouble, no money is there to lend, and the people who got loans they shouldn't have are BEING BAILED OUT BY MY TAX DOLLARS! And of course when *I* try to get a loan, I can't. Thanks. What a guy I am.

So true hoosierdoc...We are in the same boat basically. We used our own cash up-front and then had a line of credit to fall back on. Well the line of credit was recently frozen and now is being denied. Absolutely nuts! 50 years of great credit for this?