We’ve got real updates of our second floor this week and I’m beyond excited to start chatting aaaaalll about it with you over here.
Soooo, a few days ago, we signed our new construction mortgage at the notary (insert happy tears) making it **official** (oh my dear), and part of this new home extension is to document the entire process from the beginning to the end with the ultimate goal of helping as many families as I can that want or need a bigger space in the city, sharing valuable information I couldn’t find when we decided we wanted to do it.
Let’s jump into it, shall we?
Why a home extension instead of buying a new place?
This was one of the first questions I received every time I talked about our 2nd floor project. We bought our shoebox house 4 years ago and besides the incredible design and uniqueness, the house was new and had a brand new structure just built that could hold a second story construction.
Our home is less than 1,100 sqf with two bedrooms and one bathroom, but a solid future investment. So, as we saw Montreal real estate going bananas, we started saving a bit on the side asking what iiiiif we get some estimates on extending the house, for real? Remember this post with all the details?
After crunching numbers, it was way smarter to extend our current home than selling and trying to find something similar for the same price (impossible task), and with a structure ready to roll, we just needed financing approved next.
The financing process, what you can expect if you want to build in canada
This was the hard part, in all honesty. I started collecting an immense amount of documents required to get a construction mortgage approved, aaand when I say immense, believe me, it was endless.
.. And if one of you are self-employed, get ready for this (all these details are based on our personal experience)
After about 5 months trying to get ahold of a “construction” mortgage specialist with our current bank, a declined homeline credit, and 6 different agents not knowing what to do based on the nature of our request, we had no choice but to look around for a different option even if that required to break our mortgage and pay an extra cancellation fee.
We had long chats with our construction manager Marie-Jeanne to understand banks are very jealous and exigent to lend money when projects are a major one (like ours) that requires new plumbing, electric work, new roof and more, and that you can’t simply apply for a homeline credit to do it, it needs to be done through a construction mortgage that can be audited by the bank and the notary making sure the project is done and finalized.
It took us 7 months to get the final approval from the bank, YAY, we did it (phew!) and during these months, we learned that it is very important that your contractor has a solid relationship with the bank, (we were blessed to have an amazing team) that they know how the contractor works, what can they expect, how they need the advance payments during the construction and more. This alleviates the process, a lot, trust me.
New construction mortgage, say wha?
So, we said 7 months have passed already, right? that’s so dang right! Be prepared to have a copy of every single income doc, bank statements, have a great credit score, savings and if you’re self-employed even insurance policies that can guarantee you’ll be okay to jump into the construction wagon.
The construction mortgage works a bit differently than a regular one and it takes way more time to get it approved (be patient). Part of our financing was to bring the old debt from our old bank and add a sum on top that will be used to move forward with the extension.
When negotiating new interest rates, did you know you could split your mortgage into variable and fixed rates? (OH YES you can) and that’s what we did. We negotiated a fixed rate for the old debt (god bless, no worries in there for a few years) and the new funds into a variable rate that is incredible low at the moment.
The risk of taking a variable rate is the fluctuating market, but if you’re building, financing that small portion won’t affect much your payments for a few. Tip of the day: you can negotiate everything.
The timeline: the nitty gritty
After approval, we waited 2 and a half months to go to the notary (tip: the more we extended the signature, the less penalty to transfer a mortgage between banks). After signature, the FUN part starts:
Plans – measurements: we are at this stage now, where meetings started with our contractor Marie-Jeanne Rivard discussing how many rooms, feasible square footage, and high-level details. The easy part is that we are bringing the OG team who built the house to do the extension, they know every single detail about it, and they will understand how to do things faster and efficiently.
Architectural plans: next stage after we are 100% good to go with the proposed floorplan. Marie-Jeanne, our contractor validates the plans and have the architectural firm to sign them and get them ready (including 3Ds) to present them to the city.
City permits: last step is to introduce your project request to the city asking for the official construction permit and this is where you don’t know how long it will take. We planned to submit the permit request during winter while we backorder materials and start building early Spring 2022.
Spring 2022, is that it?
That is it. We took a decent amount of time in our schedule between signing at the notary, having city permits approved and starting the actual construction (a total of 6 months). COVID also affected construction projects drastically this year, with less available professionals and materials as wood, that’s why we didn’t want to rush anything. If everything goes as smoothly as planned, the project is scheduled to start in May 2022.
I was right next to my dad when he built from scratch our home in Venezuela when I was living there, that experience marked my life forever in the best way possible. Now, having the opportunity to do it all over again in our new country, makes me feel all the feels, and remembering that anything is possible.
In the meantime, we are pinning a bazillion ideas into our secret Pinterest board, meeting Marie-Jeanne, checking where to sun rises to get the most sunlight possible upstairs, selecting a colour palette, dreaming of skylights, tiles, and getting ready to have all the fun that’s coming.
Yes, all the photos in this post are from the actual inspiration of what we would love to have upstairs, including these doors for our principal bedroom, lots of cocooning corners, pink marble countertops (god bless), pink/terracotta tiles, and an airy, happy, bright space!
See you in the next update, hopefully soon!
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