Financing your swimming pool

[bobyoe]

Well, like I said, FOR ME, I wouldn't be comfortable financing 125% of my equity for anything---pool, car, house or otherwise. Heck, I wouldn't be comfortable fiancing more than 75%!!! If others are comfortable with that, that's ok for them.
B

[adillenal]

South Texas Sun- I for one certainly remember the late 80's and the oil bust. Not a pretty picture.
I worry about a repeat which can easily happen. I guess the older I get the more conservative I am becoming concerning economics.
BUT I love my pool and am very gald we built it but am also glad it has no connection with my mortgage. (Only have one)

[South_Texas_Sun]

South Texas Sun- I for one certainly remember the late 80's and the oil bust. Not a pretty picture.
I worry about a repeat which can easily happen. I guess the older I get the more conservative I am becoming concerning economics.
BUT I love my pool and am very gald we built it but am also glad it has no connection with my mortgage. (Only have one)

Hi Adillenal, I'm glad we're building our pool too and although it's pretty nice, we're still working within a budget.

If I had to choose between no pool and one that I couldn't afford, I'd get out there in a kiddie pool if I had to!

It's funny. I had a very similar discussion to this with our pool builder. He said that he was having trouble getting financing for some of his customers because they had minor credit problems and wanted a home-equity-based loan. His pools are beautiful, but not real cheap.

He (the PB) pines for the simple days of building fiberglass pools, which he said were really just as good as gunite pools and seemed to last longer than liner pools, but still weren't too expensive to "build" or upkeep.

I think I'd go for fiberglass if I were financing, but find a PB whose price was commensurate with the lower installation cost. (in other words, spend 20-25k, but not 40k in equity!)

In the beginning of our project, I got quotes from PB's that were all over the map, obviously intending to take advantage of homeowners' ignorance of what a pool should cost and the corners that could be cut in the process. We were also offered loan packages that obviously put loan "points" into the PB's pocket. It's a real battlezone out there for the unwary homeowner.

But we decided against financing, opting to pay for a nice IG pool, because we had been shopping for homes where the pool was the deciding factor AGAINST buying the place. It would invariably be low quality or need repair. Too small or built into a landfill that had been "slabbed" over and the slab was cracking.....and on and on.

We wanted a pool that would add value to the overall home, and I think we're getting it. We're nearly done and although July 4th isn't going to find us swimming, our PB assures us that we will be by the middle of July. I told him, "if we weren't, he would be, and without water!"....lol.

I don't know if you watch the "Accuweather.com" climate forecasts on the nightly news, but they're talking about 1930's "dust bowl' drought conditions for our midwest plains, possibly for a decade or more. Shades of depression era, eh?

[adillenal]

Oh great. Just what I need is more dust. I don't know what is worse, the blowing dust or hopping grasshoppers. I have to empty the skimmers twice a day because of the grasshoppers.
I am not real astute with economics but my husband teaches it so I have to listen to him sometimes. Since we are within 10 years of retirement, I think about money a lot more than I did years ago. Also have a teenager to get through college.
We may not have saved a lot from the poolbuilder quote we received (Only one builder in our area) but we got a lot more by building it ourselves. About twice as large and we still are able to add the things we want such as wider decking, fence, retaining wall, landscaping and now we have decided to add a waterfall outside the pool in the landscaping to include a koi pond. The basic pool ( using a pool builder) for the size we have with what we have added would have been twice what we have invested. Nothing fancy like some I see but we have what is compatible with our income. Trying to live within our means.
We started our pool the beginning of June 2005, and finished August 2005. Takes a long time when doing the labor yourself. Luckily husband is off most of the summer.
We DO NOT regret our investment and it is an investment to us in that we are enjoying our home (which we also consider an investment)and it keeps our teenager home a lot. BUT I am not sure if we would have built it if we would have had to take out a second mortgage or finanace through a finance company. Since we don't have any plans on moving, we really aren't concerned about raising or lowering the value of the home for resale purposes.
Everyone has to decide what they can afford and what their priorities are but to be aware of what could happen if employment ceased. We are in education, so are pretty secure as far as employment goes.
Good luck with your pool and hope you are swimming before long.

[Pool_Mike]

Getting back to the subject. I got a direct pool loan by Lion Financial.

My rate imho was high. I got 9% apr for 20yrs. But I will refi after one year.

This is for a $30K pool-loan. It is a 2nd mortgage, but my home mortgage (1st mortgage) apr rate is 5.375

So I can tollerate it, plus I plan to pay more then the regular payment is for the 20 year loan. The more the marry'ER!! :P

[South_Texas_Sun]

Oh great. Just what I need is more dust. I don't know what is worse, the blowing dust or hopping grasshoppers. I have to empty the skimmers twice a day because of the grasshoppers.
I am not real astute with economics but my husband teaches it so I have to listen to him sometimes. Since we are within 10 years of retirement, I think about money a lot more than I did years ago. Also have a teenager to get through college.
We may not have saved a lot from the poolbuilder quote we received (Only one builder in our area) but we got a lot more by building it ourselves. About twice as large and we still are able to add the things we want such as wider decking, fence, retaining wall, landscaping and now we have decided to add a waterfall outside the pool in the landscaping to include a koi pond. The basic pool ( using a pool builder) for the size we have with what we have added would have been twice what we have invested. Nothing fancy like some I see but we have what is compatible with our income. Trying to live within our means.
We started our pool the beginning of June 2005, and finished August 2005. Takes a long time when doing the labor yourself. Luckily husband is off most of the summer.
We DO NOT regret our investment and it is an investment to us in that we are enjoying our home (which we also consider an investment)and it keeps our teenager home a lot. BUT I am not sure if we would have built it if we would have had to take out a second mortgage or finanace through a finance company. Since we don't have any plans on moving, we really aren't concerned about raising or lowering the value of the home for resale purposes.
Everyone has to decide what they can afford and what their priorities are but to be aware of what could happen if employment ceased. We are in education, so are pretty secure as far as employment goes.
Good luck with your pool and hope you are swimming before long.

Hi Adillenal,

Did you mean it only took 3 months to do-it-yourself on your pool? Or did you mean June 2004 to June 2005?

If you dug your own pool in 3 months, I'm green with envy. Our PB was wonderful at first, but has gotten slower and slower and we've become more impatient. I will never hire a contruction company like this again!

In the past, I've learned to do my own subcontracting for building projects, but I didn't know any pool builder types, and I figured, "what the heck, we'll get done quicker this way."

Lol......Wrong! We're almost done at 3 months, but there's been a lot of wasted time, during which I was essentially POWERLESS to do anything about it, due to the payment schedule and seasonal rush of people trying to build pools for the summer. Ours is a little more complicated, so we naturally are at the back of the line, even though we started at the front, when they had no other pool job to start!

About your grasshoppers (and other insects) .... Have you seen this website?
http://doityourselfpestcontrol.com/

We bought some of the pyrethrin-based powder and found it to be very effective in our backyard. It eliminated grasshoppers, scorpions, tarantulas, spiders, pretty much everything. (We live in the country)

The pyrethrin-based stuff is the same as our pest control guy used on his once/3 month intervals, and costs a fraction of his visits. Plus, it's a lot better for bug "emergencies" than the stuff you buy at the store.

I have a friend who's an economist, so I'll spare you all "one-handed" "dismal science" economist jokes that he's so fond of. Nice chatting with you.

[adillenal]

Took 3 months from start to finish. My husband and another coach (have at least 2 months in summer) did almost all of the work. Teenaged son and 2 of his friends also.
We thought we were slow. If we had not hit rock we would have been finished in a month or maybe even less.

[SeanB.]

This is an interesting discussion, although a little bit of an old thread. I thought I'd share my .02 anyway in case it helps anyone else on on the decision.

We just closed on our new home last week and construction on our pool is about to begin. My wife and I went back and forth for several months on whether or not to get a pool now or wait until next year - after we had gotten accustomed to our new house note, and also because I usually get pretty good bonus and could have put down additional cash - would still have to finance some either way though.

We ended up rolling our pool into our loan for a few reasons. We wanted to get it built while we have no neighbors next door - construction has started on the lot next to us, but we don't have to get any permission or worry about landscaping, sprinklers, etc. Also, we got a better interest rate than we would have gotten with a a "Pool Loan" from a company like GE financial.

We have some friends who put in a pool after owning a home for a couple of years and they financed at a higher rate. They did not like the high payment, so they eventually refinanced their home and rolled the pool in. They got a better rate and got to deduct the interest, but still had to pay several thousand in refinance costs. When they built their last home, they included the pool and said they would definitely do it that way again.

We have three children and plan on staying in this home for quite some time-no less than 15 years, until all three in are college. I'm in an industry that provides pretty stable employment and it's unlikely that I'll be transferred so fluctuation in home prices isn't a real worry. In other words, I'm not overly concerned with the resale value on my house. My main consideration was making sure I ended up with a manageable monthly payment. Once we had the final figures from the mortgage company and realized how small of an increase a pool would make to our monthly note, it became an easy decision.

In finance terms, as I understand it, we weren't actually financing for more than the value of the house, but adding to the value of the house and then financing for that increased value (yes I know pools don't add that full amount of value, but in financing terms they do).
Of course, everyone's situation and priorities are different so I certainly understand why some people choose to pay cash and others decide not to build at all. This is just the route we chose.

[webfeet]

We chose the more economical IG liner pool because we knew we were digging a hole in the back yard and throwing money in to it. Moreover, the majority of our money can never be retrieved. But, we did it for our kids and grandkids. Yet, if we could not continue contributing the max to our pretax retirement options and monthly after tax savings plan, we would not have built a pool. If we had to make any payments, we would have forfeited the pool. Realizing that the pool is a "want" and not a need, we decided to save about 30% over other type IG pools, and settle for the vinyl. (We are going to sell our travel trailor, too)
It was a "plunge" to build an IG because we just don't spend much money frivilously. Hopefully, the enjoyment it brings us and our family will help us forget about the potential earnings we forewent to get the pool.
Years ago, we read Larry Burkett's "The Banker's Secret"- and we determined to get out of debt and to start earning interest, instead of paying it. It was one of the best decisions we have made. We were debt free by 40 years of age. We believe that how much money you earn each year is not as important as what you do with your earnings. We don't worry about the APR. In fact, the higher the better, cause that makes the APY, which we are interested in, go up too.
For the average person, who is still carrying debt on a home, I would not recommend buying a pool or any major "want" on credit. Larry Burkett's book, The Banker's Secret, has helped shape my opinion. No one knows the future,- life and health are fragile, not to mention economic climates. Consider the ants and the way they store for future needs, although today they may have more than they can use.

[SeanB.]

I think you mean The Bankers Secret by Mark Eisenson.

However, there are some other considerations to make before ditching your mortgage:
http://www.noteworthyusa.com/bankers_secret.html