So John, What do you need me for?

So, John, just what do you need me for?


In 1970, Geri and I were living in a rental house on Jericho Road in Quinton, NJ. It could be described as a bungalow with a decent sized kitchen, a dining room, a living room and two bedrooms (about 10x10 each). It had been built in 1936 or 1938 according to the chalk writing on the main beam in the basement (the 6 could have been an 8 and vice versa). When it was built it had not contained a bathroom, but sometime in the late 40's or early 50's a portion of the kitchen had been walled off for a full bathroom (?) that was about 3 feet wide and 10 feet long.. The shower was on one end, the toilet in the middle and the sink (no vanity) on the other end. If someone was sitting on the toilet, it was impossible to pass to the shower!

The house was well built and with the exception of the bathroom a good place to live. The rent was $75 a month and we thought it would suffice until we had children or found our first starter home.

About a year after we moved in, the landlord gave me some bad news when I went to pay the rent. Elwood Smith was a good man who owned a construction company and had in fact built this house and several more on the road. But, he had an opportunity to invest in a new project and needed some cash and he and his wife, Libby, had decided that they might  sell this property to provide the investment capital. He told me that he would be asking $10,000 for the house and wondered if I would be interested. I said that I would think about it and asked how soon he would be selling. He said he would give me 3 months notice once he decided if he was going to sell.

After discussing with Geri and looking at houses for sale and reviewing what houses of this size were selling for, we decided to offer $9,000. That is what I took back to Elwood explaining that the house was in need of a new roof and the exterior needed scraping, caulking, and painting. At that point, we left it that we would have about 3 months to move.

Elwood sang next to me in the choir at the Methodist Church and was indeed a good man, so several days later, he called and said he wanted to see me. I went around to his place and he made me a counter offer. He would sell me the house as is for my price or he would put aluminum siding and a new roof on the house for his. Now I knew that siding and a roof were definitely worth $1000 and that he could have his crew do it at a fraction of the cost, so this would indeed be a win-win.

I went home to discuss with Geri and she said "But what about the bathroom?" So we laid out a design that would enable us to move the master bedroom back (enlarging it in the process) and provide room between it and the other bedroom for a normal sized bath. 

I took the plan to Elwood and said that we would accept his offer and wanted to see how much the addition would cost us. He said to give him a week. When he came back, he told me that the addition would be an additional $2,750 making the total cost of the house $12,750. I said yes.

Elwood hooked me up with his banker in Bridgeton, NJ at a small local bank and they offered me the original $9,000 at 5% {going rate at the time was 5.5%} and the only things the bank wanted us to pay for at settlement were the title search and survey.

Now we had to find $3,750 from somewhere. I really wasn't sure where that was going to come from, but my parents and Geri's offered to help some. That help would only amount to about $1,000 so we would be short quite a bit.

About a month before settlement, while I was paying my rent, Elwood asked me how I was doing getting the rest. I had to be honest with him and told him that we only could count on about one-third at that point. He then surprised me entirely by stating; "Well how about me and Libby standing you a second mortgage?" He wanted to know how much I thought we could  pay a month and I told him $50 so he said, "I'll have my lawyer draw up the papers and we'll have them by the end of the week." When he brought the papers and amortization schedule, I saw that he was only charging me 4.5% interest, even lower than the bank! On top of that, Elwood paid for the lawyer's fees for setting up the mortgage.

However, being pretty nervous about making such a big decision and purchase with no previous experience, Geri and I decided that maybe we needed to have a lawyer look over the papers to assure that we were doing the right thing.

Growing up, we (the Nipe kids) had a favored baby-sitter, Faith Justice, who was the daughter of one of the members of the church and who we had known from forever. She had married Don Masten (whose mother had been Geri's favorite teacher) and he was a lawyer that we knew we could trust.

So it was, I made an appointment and went to see him, documents in hand. He took all the paper work and perused them for several minutes, then, he looked up at me and said; "Let's see, you are buying a house with negotiated improvements and an addition below market value and have a mortgage for the amount of the original price of the house which is below the going rate. And finally, you have a second mortgage with payments set by you at an even lower rate." He continued; "So, you are going to settlement to buy a house with nearly no money out of your pocket."

Then he chuckled and said to me; "So John, just what did you need me for?"    

Davdan @ 2008-2018