Lee Rotbart

Posts Tagged ‘mortgage’

Back, and in at the deep end

In Getting the mortgage on October 20, 2010 at 11:51 am

You’d think that no time had passed at all. Back from a fabulous holiday I was secretly hoping that all would be sorted, that I would sashay gently into an exchange and move. Ignorance really is bliss.

Don’t get me wrong, things have moved on a little bit and we are now the other side of a successful survey and valuation; yet it still feels like there’s a long way to go and the bank still need this, that, and the other before making the official offer. The key problem at the moment being that they’ve suddenly decided they would like evidence from my current company that I will be continuing to freelance for them once I move to Cornwall. Hmmmm… difficult. Considering that I haven’t actually handed my notice in yet, I’m not quite sure how that conversation would go…

“Excuse me boss, just wondered if I could run something by you. I’m planning on leaving at the end of February but don’t want to hand in my notice now just in case it all goes tits up and I end up not wanting to leave after all. However, if I DO leave (and I fully intend to) I would like to continue to work for you so if you could just write a letter saying if I leave you are happy to let me do freelance work that would be ace, because that would help me get the mortgage and help me leave. Obviously, this is on the understanding that if it all falls through you should just forget all of this ‘handing my notice in’ rubbish, and I will continue to stay on at the company. Thanks so much.”

It’s a bit of a Catch 22 don’t you think?

Am hoping that the bank will just take my word for it, and this will not be a deal breaker.

Meanwhile I have since decided that I have far more to worry about, and last night ‘The Fears’, or as my Mum would say ‘The Willies’, hit me like a ten ton truck. In no particular order:

  • Fear that this will fail
  • Fear that my marketing skills are all well and good when they’re for someone else, but putting my own business on the line is a different story
  • Fear that no one will want to stay
  • Fear that we will go broke in the first year
  • Fear that I am leaving behind all my friends and family and won’t have a support network
  • Fear of going it alone
  • Fear that we have massively underestimated the cost of all this and we won’t be able to afford to do what we need to do

Being quite risk averse as a person I am appalled to find myself in a highly risky situation. Luckily Danny, who is possibly the most optimistic person I have ever met, doesn’t actually believe that this could fail; suggesting that this entire scheme is a ‘no-brainer’ and through the powers of persuasion and a winning smile managed to convince me that my fears were all unfounded.

I suspect it was reading all the mortgage jargon that sent me into a tailspin; triggering the realisation that we are ploughing EVERYTHING we own into this venture. We are selling our flats in London, we are leaving our jobs, we are basing our whole future on the fact that we think we might be able to market and run a guest house, and we think we will be able to do this without killing each other. (Don’t tell the banks this, according to our business plan we are highly confident, skilled individuals that will be running the most successful guest house in the world within 3 years).

Tonight we are writing a pre-opening budget and once it’s all in black and white I know I’ll feel better, I just need to keep the final goal in mind, not forget why we’re doing all this, and fight the temptation to just settle for what I know, and what’s comfortable.

Never has the following expression ever rung so true.

‘Experience – something you get only after you need it’

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Tiptoeing into uncharted waters

In Getting the mortgage on October 4, 2010 at 12:53 pm

This morning there was another tube strike and I walked 4 miles into work. During this walk I composed a ranty letter in my head to Bob Crow while fantasising about walking along the coastal path.

London looks like Gotham City in the grey light of a wet morning; and along with a touch of light rain – the kind that’s not heavy enough to warrant an umbrella, yet gets you very wet really, really slowly – I can think of better ways to start the week.

20 minutes after breakfast I received a phone call from our mortgage broker. He asked me if I was sitting down (of course I was… that’s all I do 9 – 6, Monday – Friday) and I knew then that this could be the phone call we’ve been waiting 3 1/2 months for. He then proceeded to inform me that Lloyds Bank have agreed – IN PRINCIPLE – to our commercial mortgage application. There’s a bit of work to do yet, a survey, a valuation, and maybe a few other things that involve us paying out lots of money; but we’re over the second big hurdle (the first one was getting them to look at the proposition in the first place), and into uncharted territory.

It went like this: Excitement, followed by ‘I must tell Danny’, followed by more excitement, followed by ‘I must tell my folks’, followed by more excitement, followed by terror.

For the last few weeks Danny and I have been making lists, choosing furniture, and fantasising about breakfasts; and now it’s a reality. Now we’re really going to have to do it. Somebody somewhere has deemed that we are responsible enough, and our business plan comprehensive enough, to lend us lots of money; and I find myself in that place where I think that someone is going to come up behind me, tap me on the shoulder, and say:

“Excuse me, Miss Rotbart. Hello. We’re sorry to disturb you but we’ve identified you and your partner as people who are pretending to be adults, you haven’t done a bad job of it but we have found you out. We got our first clue last year when we observed you making monkey noises at the gorillas in London Zoo, our suspicions were aroused when you went to London Zoo without any children. We also noticed that you skipped across the road in the New Forest last weekend, again, not really behaviour befitting the 34 year old you’re pretending to be. In conclusion, while we love your enthusiasm, we really don’t think that you are grown-ups and therefore cannot lend you this money”

As much as I don’t want anyone to do that it would be the easy option, it would give me the opportunity to RUN. Run like the wind in the direction of a salaried job and a mortgage that isn’t reliant on people wanting to stay in my spare bedroom. Run back to a world with no buildings insurance (I have a leasehold) and a location where I have friends, family, and a solid network.

I wonder if others who go into business on their own have these kind of fears. They must do, surely, but just choose not to talk about them.

I do want this, I really do, the thing is I want it NOW, I want it QUICKLY, and I want it without having to go through all the stuff I’m dreading, like packing and moving (I hate packing more than I hate the aforementioned Bob Crow); setting up the internet / electricity / phone lines / fire systems; having the inevitable arguments over decor; living through the moments when we realise something is suddenly going to cost £5000 more than originally budgeted; need I go on?

I want to be like Dorothy in the Wizard of Oz, I want to click my heels together, say the magic words, and end up in a beautiful, fully-booked guest house in St Ives. In other words I want the rewards but none of the reality.

Just in case you’re curious as to my state of mind I should tell you that I am ecstatic. Sitting at my desk overlooking a Soho back alley (you’ve got a window seat – count yourself lucky!) I have a bubbly feeling in my belly. It’s a bubbly feeling that foretells of a life with no tubes, no smog, no desk job, and no hamster-style running machine. I just need to keep the ‘one step at a time’ philosophy close to my heart and all will be good.

Loyal readers, friends and family, it seems we are full steam ahead into the next part of our journey.

Oh it’s all gone quiet over there

In Reminiscing on October 1, 2010 at 4:41 pm

Yes… it has indeed gone quiet. Partly because I don’t want to jinx anything, and partly because there’s very little to say.

We have a house. We have, after a little negotiation and one tiny little tantrum from yours truly, agreed a price for fixtures, fittings and key furniture. We have re-written the business plan. We have adjusted the cash flow projections at least 4 times (and I have the archived Excel spreadsheets to prove it): And, just for a change, we are waiting for the mortgage.

Things that I have stopped doing:

  1. I have stopped budgeting (oops)
  2. I have stopped checking the stats for this blog 5 times a day
  3. I have stopped updating this blog
  4. I have stopped talking about breakfasts
  5. I have stopped reading my ‘How to Run a B&B’ book

I should however point out that I haven’t stopped doing any of these things because I have gone off the boil, or am no longer interested in chasing this project, it’s just that we’re still in chartered territory. We haven’t hit a new obstacle yet, and so there’s very little to say that hasn’t been said before.

If we get the mortgage things will start to motor and I’ll be back on here at least every couple of days recording the trials and tribulations of the next stage of the project, but we’re still very much at the beginning with, as yet, no guarantees that we’ll ever see Stage 2.

It might be a good opportunity at this stage to thank the following people for their support so far:

  • My Mum and Dad for tirelessly listening to many many stories about Cornwall, rants about banks, and spending 2 days of their holiday traipsing round guest houses.
  • Danny’s Dad for being so enthusiastic about absolutely everything.
  • My brother and sister, Danny’s sister, and other family members for avidly reading this blog and getting almost as excited as us about various house features and snippets of news.
  • Our friends for putting up with endless explanations about different banks and mortgages, and oohing and aahing in appropriate places when shown photos.
  • Laz for his excellent estate agent advice.
  • My buyers who, despite having their offer accepted on my flat over 2 months ago, have not been able to exchange, but are still patiently hanging in there. If we ever move the flat is yours – I promise!
  • Various mortgage brokers (notably Jeff, Nick, Neil and Adam) for their patience, advice and ability to be friendly even though I phone 50 times a day to get udpates.
  • Steve Cross of Cross Estates for getting in touch on Twitter and enabling us to find our new place.
  • Proprietors of Porthminster View who put the fire in our belly, sold us into St Ives, and genuinely wanted us to buy their guest house (we’re really sorry that we couldn’t sort out the mortgage in time), and who will – no doubt – introduce us to lots of really fun people if we ever make it to St Ives.
  • Twitter followers and blog readers who, considering they don’t know us, have been really supportive and friendly; and given some damn good advice.
  • The guys at Escape the City who have profiled us online, even before we’ve actually done anything!
  • Future guests, and by this I mean people who have promised to come and stay – don’t worry, we won’t forget!

It’s quite cathartic to write this list as it reminds me of how far we’ve come, and how many people have helped us so far. Should we not get the mortgage at least you still all got a thank you – sometimes people only get thanked in the event of a success and forgotten if it all ends in a bit of a whimper.

What am I talking about? It won’t end! This is just the end of the beginning, and it has all gone quiet but if experience has taught us anything, it won’t be for long.

Another weekend lost to numbers

In Second time lucky on September 21, 2010 at 11:16 am

It’s Tuesday… and I’m bored to tears of looking at our ‘revised for the 99th time’ business proposal. We’ve analysed every word, we’ve re-worked every sentence, we’ve tried to inject our personality into each paragraph and sentiment, and we’ve met (as far as we know) key lending criteria. We also sacrificed another Saturday night to the Business Plan gods.

With a massive sigh we sent it off on Sunday to our long-suffering broker.

Now the high of discovering another property has left me, I am  finding it hard to accept people’s congratulations with an excited smile because in my heart of hearts I know that the mortgage is the sticking point; and if the last few weeks have proved anything it’s that mortgages, not properties, are the hard things to come by.

Don’t get me wrong, I’m not down or depressed about the whole thing, just a little more laid back, and a little more cynical, and while I am certain that we will eventually get there, I’m just not 100% convinced that this will be the property we do it on, or that we will be down there by Christmas – as was originally intended.

I’ve learned that plans don’t always go the way we expect, but that’s no bad thing because I have utter faith that it will all work out in the end. A cash rich industry, guest houses do not lend themselves to robust business planning; being owned by people who consider them hobbies doesn’t help either; and that’s just something we have to accept.

Amusingly most of the owners we’ve spoken to have said the same thing, “Just tell the banks that we are retiring / running it as a hobby / only open 2 out of 5 rooms / close during peak times and they’ll understand”… hmmm, no they don’t! I hate to break it to all of you but that kind of reasoning just ain’t cutting it when we’re asking to borrow over £250k.

The stumbling block of the moment is that we found out that fixtures, fittings and furniture are not included in the price so we are waiting to find out the ‘good will’ cost of the business; based on the last 3 years’ accounts this should be minimal however there’s no point speculating, and I guess we’ll just deal with this obstacle when it turns up (which was supposed to be yesterday).

On the ‘going forward’ side Danny has sold his flat so will be moving in with me early November; based on the size of my flat it will, if nothing else, inject a sense of urgency into proceedings.

Back in the driving seat

In Second time lucky on August 31, 2010 at 2:01 pm

To paraphrase the inimitable words of Arnold Schwarzenegger in Total Recall ‘We’re back”. We’re back with so many plans it seems a bit pointless to continue alphabetising them. As I mentioned back on 25th August, we now know what we want, which is an awful lot more than we knew 6 months ago where I was quickly becoming the largest consumer of information on Escape the City, and desperately trying to convince Danny that we should move to France and / or join the circus. It’s nice to not be in that state of flux anymore, even if what we thought was going to be the answer actually isn’t.

Watch out all Cornwall properties in coastal locations, we are now on the hunt. We have 3 lined up already and are taking the now familiar trip down there on 9th September. And yes, we’re aware that’s still 10 days away, and yes, we’re aware that (again) a B&B in the Cotswolds would have been a darn sight easier.

It feels good though. It feels, after the last 5 weeks of ‘up / down’ with regards to getting and then not getting the mortgage, that we are back in control of things. We have a much better understanding of our budget and we really know what we want.

[Well… I know what I want and Danny knows what he wants, those things don’t always coincide and occasionally (last night for example) we stay up till 1am debating the merits of various online tools and booking systems; however, sleepless nights aside we’re much better off than we were a few weeks ago].

I’m sure it won’t surprise you to know that we spent the vast majority of the weekend discussing these 3 properties, swinging first towards one, and then towards the other. This was exacerbated by receiving a belated birthday present from my sister – Starting and Running a B&B – which has provided us with endless things to talk about, from being more experimental at breakfast to realising that it’s not that new an idea to provide homemade biscuits in the rooms, and we maybe need to think a bit more about how we are going to differentiate ourselves.

Of the 72 work-free hours we’ve just lived through it would be my guess that we spent at least a third of these talking about our future “B&B Empire”. I suspect that we are becoming quite dull.

In addition to all this excitement, last week we actually had a nibble from a bank about lending us the money. OK, it’s too late for Porthminster View… but to know that we’re close to where we need to be money-wise, well it’s enough to spur us on. We will be running a B&B by Easter – that’s our promise to ourselves, and you.