We went to Tsukuba on a Friday, and the following Monday the woman from SBI Mortgage called and said we had cleared the preliminary screening. She had already given us a checklist of the documents we would need to submit for the final screening and so we started to collect them. It’s a time-consuming process because many documents are required and you have to go to different government offices to get them. The woman had already photocopied our drivers licenses, national health cards, and three years worth of tax returns. Now we had to get real proof of our worth, so to speak. The easiest to obtain was proof of residence (juminhyo) from the local city office. The checklist still had gaikokujin toroku shomeisho, meaning proof of an alien registration card, but the Foreign Ministry had phased out registration cards last year. We could also pick up inkan shomeisho, meaning proof of registered seals, at city hall. In bureaucracy-obsessed Japan, seals remain the looniest relic, since anyone could go to the store and buy one with another person’s name on it and use it in that person’s stead. Signatures are still not commonly used for purposes of witness and certification, though they’re obviously more individual. In order to somehow safeguard the seal as a means of certification you are supposed to register yours at your local government office, and then when called upon by a party with whom you are drawing up a contract you bring that party “proof” from the local government office that the seal you are using is kosher, though I have no idea how counterpart parties check this evidence unless they’re experts in wood-block printing.

A bit more difficult to secure was proof of our income for the last two years. The copies of our joint tax return were used for the preliminary screening but for the next phase they needed actual documents from both the national and local tax bureaus where we lived, which meant taking a trip to Narita as well as a trip into Tokyo, since we lived in Arakawa Ward for the first six months of 2011. In Narita we could also go to the local branch office of the Justice Ministry to obtain records on the land we were planning to buy–history of ownership as well as the official registered survey map of the plot, or, in our case, plots, since the land we were buying was actually two adjoining lots, one about 200 square meters and the other a mere 20 square meters. This smaller plot would prove to be a hassle, but more on that in a later post. On Tuesday we took a trip to Narita to get the documents we could.

These errands were of lesser importance, however, than securing the land, which we had decided to buy at that point. Our month of grace, thanks to the moshikomi-kin, was almost up, so we would have to sign the contract soon, but before doing that we thought we’d at least try to bargain the price down. The realtor had said something earlier about other people expressing interest in the land, but we didn’t really believe them, and sent the agent a long email with our own tall tale, saying that because we would have to dig a well and put in a cesspool, the price of the land was higher than our budget–which was basically true–and that we had found other pieces of land in the area where water and sewage were included and that were cheaper, which was also true, but we implied in the message that we were interested in these other lots when in fact we were not. We mentioned that their prices were around ¥4 million, which was true again, in order to give the impression that that was the price we wanted to pay, but what we realistically hoped for was that the realtor, perhaps spooked by the prospect of losing the sale, would round the ¥5.33 million price of the land down to ¥5 million.

This scheme sort of backfired. The next day we received a terse reply from the agent saying that the company could not reduce the price of the land in “consideration of the other property owners in the development” who presumably had paid a comparable price. (Hey, if you don’t tell them we won’t) The realtor would be happy to return our deposit in full, he said. It was the terseness that bothered us. He sounded as if he didn’t necessarily feel obligated to sell us the land even if we’d paid that deposit, and when we looked into the legal particulars of moshikomi-kin we indeed learned that the money only means the realtor won’t take offers from anyone else for a month, but it doesn’t mean he has to sell it to you at the end of that period. We panicked and called the agent on the phone, saying we definitely wanted to buy the land. He didn’t utter the usual Japanese pleasantries that accompany such a deal, and when we said we would come to talk about it the next day he grunted an acknowledgment. Had we pissed him off with our attempt to bargain the price down?

Our anxiety was alleviated slightly by a call from the loan officer at JA, who said we had also passed their preliminary screening. We made an appointment for the next morning to see what the next step was, but that night we felt increasingly worried about the prospects for the land.

The next morning at the JA branch the loan officer gave us their checklist of documents to obtain. It was longer than SBI’s. For one thing, JA wanted three years of tax returns instead of two, so we’d have to go back to the tax bureau in Narita. Also, JA wanted records of our health insurance premiums. SBI’s Flat 35 loan approval process doesn’t require such records. It would mean a little more work, but at the end of the meeting the officer practically guaranteed that we would be approved for the loan. He had said something along these lines when we met with him the first time and didn’t know that we had also applied at SBI, so now that he said it a second time we felt doubly reassured. By the time we walked out into the parking lot we had decided to go with JA, even though the interest on the loan was going to be a few tenths of a percentage points higher than a Flat 35 loan and we’d have to purchase insurance through JA. Though N at A-1 had assured us SBI would approve our loan, SBI still said we couldn’t count on it and might have to wait up to a month for the final approval. Basically, we just wanted to be through with it, and since we had favored JA in the first place because it’s close to both where we live now and where we were planning to live (we would still have to make at least two more trips out to Tsukuba for the SBI application), we just decided to go with JA.

In a rush of excitement we called the realtor from the parking lot to say we were coming by to sign the contract for the land that morning, afraid that the agent might put us off, but he didn’t. He said it would take a few hours to draw up the contract and told us to come by later in the morning. So just before noon we rode our bicycles to the real estate office, where everyone was expecting us. Apparently, there was nothing to be anxious about. They were quite delighted with how things worked out. In fact, while they didn’t reduce the price of the land as much as we had hoped, they did knock off ¥30,000, dropping the price from ¥5.33 million to ¥5.3 million. Before the contract was printed up we asked if we could include an escape clause saying that if we weren’t approved for our loan we could cancel the contract. He said such clauses were normal, but in that case we would have to borrow money from a bank they designated. Apparently, this is a common procedure when buying land and made us realize once again that we were going about this house purchase thing in the most difficult way possible–i.e., we weren’t doing it all through one agency, be it a realtor, a developer, or a builder. We were doing all three of the component processes–buying the land, hiring the builder, applying for the loan–ourselves and on our own, without having any of the three processes linked internally. By choosing JA, we had foiled A-1’s plans to use SBI, and thus wouldn’t be taking out a Flat 35 loan, which would have been to A-1’s advantage because of all the structural requirements a Flat 35 loan mandated and which would have to go through Housetec–anything Housetec sold to us seemed to make money for A-1 as well. By not using the builder or the bank that the realtor wanted us to use, we were probably paying more for the land but likely would end up paying less for the house itself or the loan. We would also have saved time if we had synergized the different processes, since we had to handle the paperwork on our own. If the realtor had been party to the loan, they could have done at least some of it, and if we had worked through a developer they would have probably done everything, including securing the loan. At bottom, we didn’t really trust any of these companies, and the more time we spent with them the less trust we had, so even if we were paying more we felt that we were at least on top of the situation in terms of what we wanted.

Since we had to wait through lunch for the contract, the realtor sent out for soba and we all ate in the office. It was the perfect picture of business-client satisfaction, though in our minds we just wanted to get the whole process out of the way and be rid of these people. That wasn’t to be. Though we did affix our seals to the contract, after a long, legally mandated explanation of its contents, it wouldn’t be finalized until permission to build was granted by the proper authorities. Such permission is normally secured by the builder, and A-1 had incorporated the attendant fees into their estimate, but the realtor convinced us to let them do it, for obvious reasons, even though they were going to charge us ¥210,000 to submit the application and file the proper paperwork while A-1’s fee for this service was about ¥150,000. We could do it ourselves, but apparently it involved not only making multiple trips to the land office and getting documents from obscrue agencies, but also hiring notaries and such. In any case we’d have to keep a close eye on A-1’s payment schedule from now on to make sure they had removed this fee from the contract when we finally signed it. A lot of people have their fingers in the housing pie, which is why the central government is so keen all the time to boost new housing sales.

So while it was too late to turn back at this point, we were still in a holding pattern, but at least we got a free lunch out of it.