(00:00:00) The cost of housing should not be a surprise to anybody these days, especially people who have been in the housing market. That was the comment that bill Angel extension housing specialist from University of Minnesota. Just made to me and yet bill. I don't think it matters how long you have been in the housing market. I was in the housing market about two years ago. I am still surprised at the way. The cost of housing is increasing and I presume the increase has not let up. Is that right? (00:00:25) That's correct. Perhaps I should have rephrase my response to say that it may not be a surprise for many people. It would be a shock. We've seen major inflationary impact, which is really nothing more than a continuation of a long historical Trend that's continued at least over the past 90 years. And that is that new home prices existing home prices are consistently outdistancing the rate of inflation the general rate of (00:00:53) inflation. So buying a house is still a good bye. (00:00:55) It's a good buy, but it's also not easy (00:00:58) and that's something we want to Two and a bit is the availability of the various kinds of mortgages the various categories of mortgage money, but first bill is average figures that we see every now and again, I think can be very confusing to people and perhaps even slightly misleading. I remember seeing an average figure for the cost of a home and perhaps it was Minneapolis. And I think the figure was about sixty three thousand dollars and I wonder if you can give us some range of figures for a single-family dwelling in Minnesota that cost this year. (00:01:26) Well, it's going to vary and I think the important thing Dan for our listeners to realize that is that averages are a hypothetical type of situation. It's just like the average buyer in the average home neither one exists, but it's essentially a midpoint between highs and lows and that can influence greatly an individual's deviation from that average. In other words people don't buy average houses and that's critical to realize nevertheless average. Or medians give us a point of reference a barometer if you will in terms of what's happening in the price of homes. (00:02:07) And so what do you think about that $63,000 average price? What does that tell us really about how about homes how much people can expect to pay for a home today? (00:02:16) You're going to find essentially in the marketplace loosening up of homes above the average in other words. There's a greater Supply than demand. We're seeing a Slowdown in the marketplace to certain extent on the low side of the average especially dropping down into the 32 $45,000 category. It's going to be tougher to find available houses. They turn faster part of it gets when we look at the supply and demand if you will that the demand currently is very intensive for first-time buyers, which tends to be at the lower end of the market. It's one of the reasons we're seeing especially in the metropolitan area also in selected areas. Southside and increasing condominium apartment Market a conversion from rattle to ownership situations is it true (00:03:07) bill that people who might be shopping for homes in rural areas of Minnesota and also in other Minnesota cities other than Minneapolis st. Paul can generally find housing prices much lower than they would find in the Twin Cities metropolitan area, or is that more or less a myth? (00:03:22) It's true to a certain extent. Let me draw a parallel. However, and that is the many individuals feel that wage levels wage scales may be lower in rural areas. But we take a look at the imperfect data that we have primarily reported under the davis-bacon act and if you followed the media recently, you know some limitations with that but nevertheless we find some higher wage scales and selected rural areas, especially where skilled labor may not be as available and demand very intensive. (00:03:55) I mentioned earlier the availability of mortgage money. We continue to see ads especially by I guess they're called development companies new home construction company saying that we have nine percent money available. Is that a period of time when I guess the going rate for conventional home mortgages in Minnesota is what about 11% Yes, where it is right now. So what is the availability of conventional home mortgage money? (00:04:20) Well conventional money is generally available at this time. It's expensive at 11% in reference to the ads where you see a developer advertising. We have nine percent money available or eight and a half or eight and a quarter. It's one of two situations. The either that developer has gone to a lender and bought a block of available mortgage financing which he or she will in turn put that cost into a higher purchase price. So it would be one a commitment which you as a buyer. Be paying for directly through higher purchase price or it may involve a state or local subsidy program where the state government or the local unit of government have used their bonds. They're bonding authority to generate a source of mortgage funds (00:05:13) is the 11 percent rate the same for insured conventional mortgages and (00:05:17) Bill. It's going to vary a little bit with the amount of down payment and you have an insurance premium that would be on top of that that may be a one-time payment and that the payment for the insurance premium on a conventional insured is a negotiable item that either the seller or the buyer me pay for generally the market practices for the buyer to pay for that (00:05:39) now a conventional insured mortgages one where the home buyer might have to make a slightly lower down payment. Is (00:05:45) that right? Yeah. So I generally a plane conventional mortgage. That's a loan between you and A lender directly with no other party involved will require minimum down. Payment of 20% or 25% is more common anything below that at 15 10 or even 5% down would be a conventional insured or an FHA insured or be a guaranteed. It's a little bit like alphabet soup. This (00:06:12) Mel say how successful what success do people have when they try to shop for various kinds of mortgages that is to say is there much leverage that consumers have when they go to One bank that may have some insured conventional mortgage money available as opposed to one that may have conventional money. (00:06:27) Well the availability and the cost of financing can vary on a daily basis and can vary vary substantially between different types of lenders. I know of no financial institution that literally closes the window and says, we will not accept any mortgage applications What A lender will do is simply make the terms to get that financing more difficult if they want to slow down their loan volume by requiring either a higher down. A month or adding additional cost at the point of closing. These are ways lenders regulate their loan volume. And so it does pay for individuals to shop around (00:07:09) and would you say build it in your experience big Banks medium-sized Banks or small banks? Give a break on home mortgages. Any track record there. (00:07:19) I would say in terms of the financial Community for mortgages the Savings and Loan industry and comparison to National State Banks are the more active sources of financing and also Mortgage Bankers in respect to federally insured (00:07:38) mortgages. Now, what about FHA and the money available for can for home mortgages under that program and we should talk about the point system to and what has been happening there. First of all, the availability of FHA Home (00:07:50) Mortgage must available. In fact FHA has been very active within the past few. Months and turn over to dick and asked dick. Are we attending the half currently with FHA? Do you know off the top of your head the last (00:08:03) report? Yes plus (00:08:05) so you're talking an effect of (00:08:07) 11% and Dick of course is dickish. We're who is vice president of Stewart construction dick. Maybe you can pull up to the microphone just a little bit as we get you involved in this discussion of FHA mortgage money because this point system with FHA I think must be a quite a merry ground for a lot of people and very confusing. But what were what number of points are we at now for? (00:08:27) Well, we're at a very low level right now. It's going to vary by lender depending on how competitive the lender is, but perhaps we should explain what points are and very simply one point is equal to 1 percent of the mortgage amount. Now A lender will charge points for an FHA or a GI or VA mortgage to offset some of the higher cost he or she might have and respect to the processing of that particular mortgage application or because the rate maybe not competitive at ten and a half percent if I could make a loan and 11, I'd prefer to do that rather than ten and a half percent. So I would charge points to cover that difference which in effect is a prepayment of Interest now Federal Regulations require that that the buyer person that's obtaining. The FHA loan does not pay points directly that is in a smart seller simply puts that in the purchase price and so in effect you as a buyer would be paying those (00:09:35) in a few minutes. We're going to allow listeners to call in with their questions for Bill Angel who's been giving us some Ins and outs of the mortgage money market here for the past few minutes and also questions to Richard swear who is vice president of Stewart construction from Minneapolis Stewart construction specializes in general contracting and remodeling tool and that's going to be the direction of our discussion. Now for the next few minutes is for many listeners who already have their home they're thinking about adding on to the home or probably more likely remodeling major portion of that home and we'll be getting to that in a bit. The time now is about 28 minutes after 12 o'clock. This is midday. We should mention that bill. Angel is an extension housing specialist from the University of Minnesota. That title hasn't changed. Has it Bill not that I'm aware of. All right. Now within the last half-hour I want to give out some phone numbers that people can call to ask questions. I'll do that right now and we'll get to a few other questions on Home Remodeling than before the calls start coming in if you're listening in the Twin Cities area, you can call us at 2 2 1 1 5 5 Zero at telephone number in the Twin Cities is 22115502 asked question of Bill angel or Richard swear on housing costs or remodeling costs. And if you live outside the Twin Cities, but with in Minnesota, you can call toll-free and the toll-free telephone number is 1-866-560-4440. 9700 now Bill and Richard where does one begin the process of deciding? What is the first step in home remodeling or Rehabilitation bill or throw that (00:11:19) to you first? All right. Let me bite on it very quickly. The first thing that an individual should recognize her. The first lesson is do not underestimate the time or the economic cost of doing the job quite simple, isn't it? Don't believe it simple but profound I'm a rehabber myself personally and have many neighbors that are in the act of process of rehab. None of us have estimated adequately the cost the human cost or the economic cost. And so that's the first thing I think for listeners to be sensitive to rehab has high economic costs that you'll probably underestimate and High human cost that you'd probably (00:12:04) underestimate now Richard I suppose one of the reasons for that is because in my personal experience, I find for example that the cost of lumber can change virtually overnight even within the same day and I presume that's a an important problem. Yes. It has really been a problem in the last two or three years and what has been happening in that area. What is the percent of increase over a period of time? We just well, I just recently estimated a job last Fall's an example November people decided they weren't going ahead with at that time. They call me back in June and decide to go now. This was quite a lot roof oriented to items on there. Roofing and Plywood And we had I think 13.9 increase now this is taken to the fact that I did not add any percentage for labor. We did have a increase in me. I didn't add that in and so that gives you a little idea of where things are going. This is probably not an uncommon response from homeowners interested in remodeling that is to say they might call call in a series of estimates from a number of contractors and then wait three six months perhaps and that can really change the picture drastically. Can it not that is correct. It can especially in the material costs labor costs have been more or less stable with the contracts and so forth metropolitan area, once Richard the homeowner has established that they want to do some work whether it be remodeling or adding on or whatever. What do you recommend they do and because most of us are not very knowledgeable about materials required cost of materials. Should they call in a contractor at that point should they begin talking with neighbors or what? Well if they're going Number one they should decide basically if they can with a going to do it themselves or whether going to use a contractor either way. If it's an extensive project like a room addition or extensive rehab within the house, they should definitely have someone either a contractor or an architect or there are some excellent drafting services in the metropolitan area here and they should work out a plan so that they can put this job out for bids. In other words. I always mention the people the idea. Is this your building a new home at the old slot. And if you're going to build a new home, the first thing you do is you get a plan now, it's very difficult. Sometimes for people understand is why you because they think you can see it problem is that I see one thing another contractor sees another thing they see another thing altogether what their ultimate goal is and so consequently my doing these plans they pin it down exactly what they're going to have done and they're not bidding apples and oranges. They're going to be getting all apples. So you're talking about a blueprint that is correct similar to what an architect would prepare or a draftsman. Yes, and it doesn't have to be real detailed. So forth but there should be and an F floor plan some elevation simple elevations there could possibly be maybe a list of simple specifications of the site is type materials and so forth this raises an interesting point that I suppose a lot a lot of us homeowners should be prepared for and that is we should probably be prepared for some of these front-end fee costs that is to say site preparation surveying drafting a plan. For example, what are some figures you can throw out that people might expect to pay for these Services. All right, honey. Let's just talk about first a kitchen or bathroom for that. You can use a drafting service now, it's difficult at times to find my we as a contractor of tied up with some drafting Services some have in-house drafting I would say that will run from 75 $250 to have a very simple kitchen or bathroom plan elevation. Now, if you get into extensive elevations and extensive kitchen, it could run up to $500. It depends on the project in other words, if you're doing a three to five thousand dollar kid. Or a simple bathroom I'd say 75 $250 would probably take care of in a very simple plan. I'm not talking about a lot of detail but something where you can pin it down as to what the size the project what the elevations of the cabinets and like in the kitchen in the bathroom the vanity the mirrors and so forth. Also, it's very important to get the locations for in the bathroom. If your one inch off in any of the spacings of the fixtures in the bathroom, you could have a catastrophe. So that's how important the planning is one inch off meeting the plumber might have to change considerably the plans here extract or the vanity had planned on using or the countertop that you ordered special may not fit. Yeah and how many different groups of people can a homeowner expect to deal with in this process of first of all, getting the plan shopping for the materials and so on ideally I suppose it's nice to deal through one contractor or is that necessarily ideal? Well that old again the homeowner has to decide you know, what what he is willing to to spend number one if he deals with a contractor like ourselves, he'd have one person like I always You have one person to argue and fight with one person is responsible for the whole thing. And if somebody comes out and there's a dispute. It's up to the contractor to settle it now. Sometimes this can be very difficult. Even for the contractor and this respect if they're going to do it themselves again, it's very important that they have the plan for instance. If you go out to meet a local cash and carry lumber yards, they have some very talented people in these locations, but if you don't have a plan so that you can order the material and they can price it off material. They may be guessing especially in the kitchen or get in the bathroom. It's very critical. You're going to save money if you if they know exactly what you're looking for. Now. That was my next question to you. Richard was showed a homeowner make plans to purchase the material themselves and perhaps try to save some pennies that way or perhaps some dollars even that way rather than relying on the contractor to bring all of the material not normally for instance a plumber. Just going back to a plumber again. It's been my experience over the years and we're a general contractor. Now we can go buy all these Plumbing fixtures at the local Plumbing warehouse. Wholesale house we can pay the same price as a plumber sometimes maybe even a little less if he's a small plumber problem is that the plumber is going to determine that if he's a individual entrepreneur he's going to he's got overhead. He's got to go out the job and set it up and one way or another. He's normally going to get his profit off the job. And if the truth were known generally the homeowner in a sense could possibly get ripped off and I mean in a legal sense because the man is entitled to a profit plus the fact the big problem is for instance again talk about Plumbing. They have the wrong trap doesn't meet the code. They have the wrong strainer. Maybe the faucets don't work in the sink their short parts and the plumber noses or it could go over the electrical many types of materials and consequently, they're going to add for it. You mentioned a buzzword of this season and that was cold and I want to spend just a couple of minutes talk. About that issue of code and how Minnesota residents must conform before that. I'll remind listeners that were talking to Richard swear who is vice president of Stewart construction company and Minneapolis. And with him is Bill Angel extension housing specialist from the University of Minnesota about the telephone numbers one more time, and we may have to clear our telephones here from our call forwarding system in order for calls to come in in the Twin Cities area. You can call us at 2 2 1 1 5 5 0 if you have a question for Bill or Richard as 2211550 listeners, in other areas of Minnesota outside. The Twin Cities can call toll free to ask their questions on Home Remodeling costs in the toll-free number is 1-800-695-1418 297.00 now on the issue of code Richard and Bill there is a uniform code in effect for Minnesota. Is that right? So that I would expect contractors all contractors. In the state are aware of this code and homeowners should be and there would be no problems in remodeling projects being up to code. What's your experience on that? Well again to say there'd be no problems. I would disagree with that kind of thing in any rehab a remodeling job. There are going to be some problems show up and I tell my customers right begin with I don't know what it is. But before this jobs are going to have some problems out here. I hope they're minor and so you try to so yes, there is a state code. However, it's not you it's not enforceable in all areas of the state. It's up to the local entity to decide whether they want it or not. Unfortunately is from my standpoint. There was some changes made in the law in the last legislative session. I think this will come back to haunt us. So if the local inspector chooses not to or if the township or County Board chooses not to go by the code, they don't have to that is correct in the metropolitan area here there the code is area-wide. In a lot of areas of contractors are are required to be licensed and you're also required to get a building permit. And if I can just go on with building permits a little bit. A lot of people are afraid to get a building permit. They're afraid that's going to be a session is going to come out increase the value of their property and the taxes are going to go up for extensive modifications. Yes, but if you're doing a small remodeling job or something chasing a bathtub you already have a bathtub you're going to find that the increase in value is probably nil. And if it is a little bit keep in mind these people are there for either their protection health and safety and in plumbing or electrical. It's very critical that this be done again from a building standpoint. You don't generally Hear Too Many people getting hurt if there's some structural thing that done properly but again from a plumbing electrical or a heating but in order to make sure that these installations are properly installed and are not hazardous. They must be inspected so I would insist if A person make sure if they hire it done that they had that the contractor is licensed if it's required bonded if it's required and has it inspected if they do it themselves, which is legal now in a lot of areas if they live in a home themselves, they can do the work themselves provided. They should get a permit and the inspector will come out inspected to make sure that it is safe. This is interesting because I know literally quite a few people who have not bothered to get permits. They have done a lot of work on their homes themselves and I'm curious. So what is the potential liability of this sort of situation if indeed if indeed a permit is not required by a homeowner for work done and in his or her home what could be the what could be the outcome? Well, there's there's a possibility of getting in trouble with if they had a fire for instance. There's a possibility and again, I've only heard of a few cases but there's a possibility that their insurance may not be in effect again. I'm not an attorney and all these cases aren't individual basis. I think you got to look at it though. It's strictly for their own health and safety. And if you look at it from that standpoint that ought to be enough said Bill Angel. Did you want to add something to what Richard was saying about this issue of code requirements? (00:22:41) It's my own feeling that if an individual does not pull a permit to do any kind of work on their home or require that their contractor or subcontractor pull the necessary permits that they're fools literally fools. The inspector is an independent third party and we'll evaluate and assess essentially the safety dimensions of a job being done properly and that's crucial in a remodeling situation. If you are living outside the metropolitan area in a rural area that has not adopted the State Building Code. I would encourage an individual to include in their contract with a traits or with a subcontractor contractor that all work shall be in compliance with relevant portions of the State Building Code. The only problem is they don't have a friend in the form of an inspector who will inspect but that would be you need to Recognize the power and desirable dimensions of the State Building (00:23:45) Code Richard. You mentioned another phrase that I think might be very important to cover a licensed and bonded what are the problems that could result if somebody hires a contractor that is not licensed and bonded and what does that mean? Well licensing and bonding doesn't necessarily mean that the people won't have a problem with the contract. However in many of the areas, especially in the metropolitan area of the contractors in order to work in that particular area must be bonded or must be licensed and possibly bonded. It depends again on the the sinking of the municipality generally speaking the Bondo goes back to the municipality. It doesn't go to the people in Municipality of there's a law skin and it gently around $2,500. So it really doesn't protect the people to a great extent. There has been an effort over the last of leave three legislative sessions to get Statewide licensing. And again, we haven't been successful most reputable contractors are in favor of this particular law again be aware. I would say if the contractor says to you You know your sign a contract get the job and you say well you could on get the permit don't because number one if you get the permit, you're responsible you're reliable and in some cases the Contracting still be held liable, but there are some problems involved you got the permit and the inspectors more or less not obligated really go after the contractor. However in the City of Minneapolis are in st. Paul it gets down to a point if you're acting as a subcontractor for instance, if I did a job for an individual when out there even as a subcontractor, I am required to be licensed. We are at about 17 minutes before one o'clock and we have a couple questioners on the line Bill and Richard would like to ask questions of you. So I'll ask you to put on your headphones and I apologize to listeners who have been trying to reach us who may have may have had some complications. One of our phone lines has been out. So a number I one of the numbers I give out earlier wouldn't work for you. I'll give out another number that you can call in the Twin Cities area. The toll-free number is still okay. That's one eight hundred six five two 9700652970. Your number you can call in the Twin Cities to ask a question of Bill or Richard is 2211500 or 2211506. So we'll spend a few minutes taking some questions from listeners will take the first one. Good afternoon. You're on the air. (00:25:58) I am in rural Cannon Falls. I need a drain around my house. So the water doesn't come in the basement. I also would like to set up for wood Heating. boiler wood burning boiler How can I get contractors around here to move and come and look at the (00:26:25) job? You mean you're having some trouble interesting people and coming to look at your project? Yes. Okay. Well, let's take a stab at that Richard. Okay first thing do you have a local building inspection department? (00:26:40) I think it's in pretty good you County? (00:26:42) Okay, I would suggest One Source, you know people used to contact those particular people. They may be able to help you. Secondly you could contact possibly local Lumberyard. They have people they work with now I know this year even in the metropolitan area here. It's a very difficult to handle the volume of work that's coming in for instance in our case at our office. It's really a shame. We just can't handle it. So you have to be patient. This is very interesting Richard because this collar raises an issue that has troubled me a bit. We had a couple of estimates that we wanted a couple of estimates from people who just didn't show up for the appointment to give us the estimate on our home. And as you point out this must be an extremely busy construction season is that an indication that people are just much busier on their homes and ever before yes, I think they're trying I think what we say is they're trying to save what they have. And also there's a bit of a panic because of this And that again you have to watch out because they're you'll have people always in the industry. They're going to take advantage so you should try and get at least two bids if you can so you mentioned in this in the case of this gentleman from real Cannon Falls. You can check at The LumberYard he could check with his County inspection people. Yes, and I might mention one other thing. He says he needs drain tile around his building. He should check into this. There's also quite a successful system that goes inside. It's a certain type of system where the force broken up inside. It's a quite successful. He might want to look into that rather than going around the outside. All right, we'll take other questions because we have other callers waiting next one. Good afternoon. You're on the air. (00:28:22) Yeah, they were on loan for home improvements. You know like SMH a is available to small towns to get home loans at low inches. Is there anything for a home (00:28:38) Edition? All right, I think Bill Angel is ready to take that one. (00:28:42) I'm assuming that our listener was referring to when he said FMH a or something along that line Farmers home Administration and in rural areas Farmers home Administration does have a home repair and improvement loan and grant program for individuals with very low incomes. You may also wish to check with your federal land bank that may be able to essentially rewrite your mortgage to include remodeling cost as well as conventional sources of excuse me a financing. (00:29:18) So this would mean that many people could check with the their local banks and a good number of local banks participate with the Minnesota Housing Finance Agency to is that right in these low interest in low income loans? (00:29:30) Correct. Although it. We have some spotty areas in the state where lenders are not active especially in the Northwestern portion the Red River Valley. (00:29:38) What's the alternative then if they want to participate in the M FH a-- programs or the Minnesota Housing Finance Agency programs (00:29:44) rather. Well, it depends on the lender and consequently, it would be encouraging hard enough and lender to be involved in the Minnesota Housing Finance Agency (00:29:53) programs. We have another caller on the line and we'll take this person's question right now. Good afternoon. You're on the (00:29:58) air. Thank you. I have a brick home in Minneapolis with big picture windows and this sort of thing and I wondered what could be done by way of further insulation without without going outside over the brick. If on the inside we could put maybe an inch of Styrofoam or something like that on the outer world to see if heat but I understand there's some problem about this in that it's so vulnerable being soft or that it also Generates deadly fumes in case of any fire something so it has to be covered by some sort of a sheathing is this true? (00:30:39) That is correct. Some types of these foam insulation is must be covered to meet the code. You've got a real problem here you look at the economic feasibility of adding additional insulation in the walls and this home. Yeah, I think you're you're gonna have a problem. There's two places. I think that you can really look to save money number one. You can put additional insulation over above normal like we right now we're trying to insulate everything at least that we do to our 38th in the ceiling. You can also look at your windows. Now, I find that in many homes. You have more the biggest loss in particular in your case with brick is Through the Windows. I want to make sure their weather stripped that your storm windows are in good shape and your doors or whether stripped, you know with a good either vinyl or metal interlock type insulation. All right weather stripping these are the places. I think you should look at the present time I'd say with your again without looking at it. You couldn't tell but I would say probably You got brick there. It's not economically feasible to add additional information insulation in your walls. All right, and we have perhaps one other caller waiting. I think we have a caller on one other line at this moment. We'll see if that person is there good afternoon. You're on the air. (00:31:46) Yeah. Mr. Angel. Yes. I have a couple of questions. I'd like to ask on and why is the FHA interest rate less than conventional and at the same time why is there are no conventional money available for duplexes. Let me respond to the first and I'm a duck the second one at this particular point in time. But in respect to the FHA the federal housing Administration interest rate that's established under Authority or the authorization of Congress by the US Department of Housing and Urban Development. The reason that it is generally lower than the conventional mortgage rate is because it's assumed that since that loan is ensured the lender is insured against Allah Pause associated with that mortgage if you default is the owner of the property that there is less risk and therefore the interest rate deserves to be less and that's the reason for the lower interest rate on FHA. I see and as far as the reason for no conventional money available for duplexes, I would shop the market because I'm not sure that's completely true. How many lenders have you shopped? I visited with about three or four of them and I as I understand it in the Twin Cities area conventional money for duplex. It hasn't been available for some time and I really haven't been able to get a straight answer as to why not. Well one reason might be that lenders are attempting to conserve some of the funds that they have available. I would continue to shop there are FHA programs available for duplex purchase and I clearly shop the largest Savings and Loan institutions the largest National Banks and the twin Cities and I'd also call a mortgage (00:33:33) Banker. All right, and we have a couple of other questioners waiting to get their questions in before we come to the end of this discussion. We will get to those two final questions. I want to ask a Richard about a point though quickly. What about the advice Richard that we have heard for a long time that the best way to get started on a home remodeling project is to ask your friends for them to refer you to a building contractor. That is right the best place to go house there's several places, but I think one of the best places to go to your friends ask your friends and that includes your Banker, he's a friend. I hope he'll have to be if you start the project you go to those and you ask them for names of people who have had a successful track record. Now the next thing you do when you do get a contractor out, you can ask him for instance where he banks and get the name of his bank call your banker and tell the check him out. We do this right along and if the person the contractor or the person that you're dealing with has a good track record, you'll find this out and when you say a good track record Richard, what do you mean that all that he's paid his number one. I think if a man's been in business for something like the time the only way you can stay in business is by paying the bills. Okay. There are also some other things that maybe we get into a little bit make sure that he's paid his bill and I think we can't really get into that today. But in other words obtain lien waivers and this is a whole this could be a whole subject for another whole session here, but just that it's a warning it's a good point and we'll have to have that session sometime in the near future and we'll get to a publication that bill Angel may have on that very issue. I have a couple of more questioners and let's get to them before the end of the discussion. Good afternoon. You're on the air. Hello. Yes. Go ahead with your question. We're (00:35:09) going to have two questions one is I'd like to ask what the what their attitude is toward the practicality of a Solarium type extension to a kitchen in this climate, you know where the slaves on three sides or including the roof or an angle of the (00:35:29) roof, right? That's the first question. Should we answer that now sure well there again you could end up with really a game because if it's faces the South or possibly the East and maybe a little the west but basically the south of faces the South Direction you could get a heat gain out of that thing when you talk about silurian, there's several different ways of Designing these things. There are some very good roof type Windows now available, you can get large sections of glass triple glazed. And again, there's a Code you're going to have to meet it and you know, looking your overall overall house. There are some problems in certain areas and building these because they Take the energy code in its strictest (00:36:10) terms where I'm talking about the Twin (00:36:11) Cities. Well again, it depends on what particular area you live in you could have some problems because they take the again. Like I said the energy code in the strictest sense and you have to go and get an audit on the whole house in order to make it. Alright, and the second (00:36:25) question second question had to do with the feasibility of refinancing and addition. I know one can refinance a mortgage. How do they feel about that? I would examine the economics of that very closely. Look for example at your current mortgage repayment how much you're paying excuse me per month and then what type of loan above and beyond that that you need and add that interest and principal repayment on top of your existing mortgage and you may find that retaining your present mortgage with a home improvement loan will be less than refinancing your total mortgage to cover the cost of improvement, but it's not possible to refinance. St (00:37:07) Edition Well, yes you if you had a let's just use an example. You've got a ten thousand dollar mortgage left on your house or a fifty thousand dollar mortgage. The Edition ones 15,000. You cannot get a new mortgage for 30,000. You'd probably paying the rate of 11% Now, I have a lot of customers that refinance. However, you really got to look at this very closely. If you're in the lower income range where your adjusted gross income is below 16,500 there is available at least in the metropolitan area quite extensively Minnesota Housing Finance Agency loans, which are available at the maximum rate of 8 percent depending again on your income at the maximum rate is 8% There's also available several different individual Home Improvement plans from the individual Banks. They have their own plan. And of course an FHA title one, which are around the rate of 12 percent simple interest. All right, very good. Thanks for your question. And we have one more question or on the line and we'll take that collar right now. Good afternoon. You're on the (00:38:00) air. I'm thank you to continue about this lady's question about a Solarium which I take it to to be like a greenhouse. We have one it has I'm two layers of glass about two inches apart. The outer one, we replaced with plexiglass. And my question is how is that actual glass is an insulator as opposed to Glass single or double thickness. So essentially you're going to find the same insulating properties all you're gaining off the glass or the plexiglass is they are film per se I see. Okay, then I have a question about acrylic or fiberglass bathtubs. Are they durable? I'm having my bathtub replaced and I have no experience with Fiber (00:38:47) Well, we have two quite extensive experience with fiberglass and some experience with acrylic bathtubs. I guess I'd have to say we've had less problems with those overall and we have with the cast iron. Yeah. Yes. The thing to stay away from is a porcelain tub. Yeah, probably one of the more common forms of tubs to not any longer. That's that's other words. It's just a metal that's (00:39:08) personalized. I thought that already but then we have a room that is built on a slab it was built on later. It has electric heating panels in the ceiling which is accursed em Arrangement besides they're not being made in. Some of them are out. This room has glass just about all around. It is a terrific problem heating it. It cost us as much fun at 124 square room as foot room for the whole rest of the house eating with oil. I have you any suggestions what to do. I would like to refer you to an extension publication available from any county office in the state if you're concerned about heat loss and what improvements are Justified or not request older 389 folder 389 from any of our County Extension office's the find our offices listed under County listings Agricultural Extension Service. Cooperative Extension Service, and also there is a remodeling your older Minnesota home publication. If you want further information, (00:40:18) is there a number on that remodeling bulletin bill? You know, there is it's bulletin for 17. All right, 4:17 for remodeling and 389 was the earlier one. He referred to very good. Well thanks to both of you gentlemen, obviously from the number of good questions. We had I hope we can encourage you to join us again, perhaps in The Fairly near future a couple of months from now and we'll tackle this issue once again, because we did not get too many important points as you mentioned the liens a waiver problem and all sorts of other questions. So thanks to Richard swear who is vice president of Stewart construction company in Minneapolis and to Bill Angel University of Minnesota extension housing specialist.