House Buying Tips...

[whateverrrr]

I can't stop thinking how scary buying a house seems everytime I pass over this thread.

I don't think I could be committed to something for 30+ years. Nor, do I think I want to stay in one place that long.

I'm going to become a vagrant if this whole career thing doesn't work out for me.

[suburbanargyle]

I can't stop thinking how scary buying a house seems everytime I pass over this thread.

I don't think I could be committed to something for 30+ years. Nor, do I think I want to stay in one place that long.

I'm going to become a vagrant if this whole career thing doesn't work out for me.

You don't have to be committed to a house for 30 years. You can sell it, lease it out, etc. I don't know anyone (adults, friends, whatever) who has only owned 1 house their entire life.

[adamlikesmusic]

Yeah, aside from my grandparents, I don't personally know anyone who has actually stayed in their house 30 years.

[whateverrrr]

I can't stop thinking how scary buying a house seems everytime I pass over this thread.

I don't think I could be committed to something for 30+ years. Nor, do I think I want to stay in one place that long.

I'm going to become a vagrant if this whole career thing doesn't work out for me.

You don't have to be committed to a house for 30 years. You can sell it, lease it out, etc. I don't know anyone (adults, friends, whatever) who has only owned 1 house their entire life.

I understand that, and I don't know anyone who has lived in the same house their entire life either. It just seems like an overly complicated process that I'd rather not take part in, I suppose. I mean, I want to move every couple of years. At least for the next decade or so. Maybe when I grow up, I'll have different ideas of home ownership and whatever.

[qskapunk]

the PMI you pay is deductible, as is the mortgage interest you pay.

all told it was like $11k in deductions for me and my wife last year (2008)

[qskapunk]

paying PMI isn't that big of a deal

who honestly has 20% to put down on a house - especially first time home buyers?

[xfedupx]

Everyone gave great advice so far. As someone who just bought a house (closed last month) here's a few things that are fresh in my mind. Also, I know it's a different process in CA than it is anywhere else, so I'm not sure ho w much this applies to you.

1) Find a good realtor to represent you. I had 2 before I actually bought a house. The first one I had thought it was enough to just put me on their email list. They never called, never pointed things out I might have missed, etc etc. The 2nd one, would never return my calls or my emails and if I'm spending that much and making you that much if I buy, I expected a little better customer service. The third one I went with was perfect, they hit me up every couple of days and asked if I saw anything or wanted to see any properties. They would return my emails/calls quick and I just felt comfortable. Remember, they work for you and should be doing their best job for you.

2) Have all paperwork/income statements ready - The bank wanted my last 3 years of tax documents and W2s. I also needed random paycheck stubs to prove I was still employed/was getting an income

3) Be patient - Once you find a place you like an put an offer in, you need this. It's basically a waiting game. Waiting to hear if it got approved, waiting to find out if there's a counter offer, waiting to find out when closing is, etc etc. Escrow patience is another thing..but pretty much the same.

4) If you can, get prequalified and preapproved for a loan. This makes it way easier when you're making an offer. It also tells you how much house you can afford. Another benefit, if you made an offer on a house and someone else made an offer around the same time....you being preapproved gives you the upper hand and will more than likely get your offer approved over the other guy

5) If you're getting a short sale/foreclosure, patience once again. The place I got was a short sale and we went back and forth with negotiations. The bank wouldn't budge, but I know other banks will budge, so don't get frustrated if you go back and forth a few times.

6) Take into account closing costs/things you'll need - Closing costs can add up. To be on the safe side, I'd put another 3000-10000 aside to pay for these. You always want to assume the worse just in case. Also, since you've lived at home, there are other things you'll need like a lawnmower, curtains, paint, shovels, rakes, dishes, pots pans, etc etc etc

7)Take into account other monthly expenses: PMI if putting less than 20% down, property taxes, water/trash bill, internet, gas, electric, phone, records, etc etc

Once all of that is done...and you're in it, there's no better feeling! That shit is yours. Honestly, my life has changed since I got it. Like it's hard to describe, but the pride you feel of working your ass off for this finally paid off...it projects out to people. I've had people tell me I'm a totally different person now...which is weird. But good luck man...

PM me if you need/want anymore info

Edit - Make sure you spend the few hundred bucks to get an inspection. Seriously, one of the best/smartest things you can do. My dude found so much stuff (nothing major thankfully), but they are so thorough and it will make you feel a lot better or will make you feel like you want to pass for now

[jemsklile]

So I am in the process of putting an offer in on my first house.

Do you guys that have gone through this have any tips or things I should make sure to look into when buying a place? Home inspection, etc.

It seems like there are 10 million little things that I need to be aware of and I don't want to be missing something obvious.

Thanks for any suggestions in advance!

[deafmx]

congrats!

[weck]

either get a home inspection by a reputable inspector, or get someone that you know well that knows about everything look it all over. there is a lot to know and even inspectors miss shit..

[jemsklile]

Thanks dude!

Yeah I'm for sure getting a home inspection. I almost feel like I should get two. My girlfriend and I have written down every little thing that is somewhat questionable to point out to the home inspector (if our offer is accepted). So hopefully we can help in making sure they are thorough.

[weck]

Thanks dude!

Yeah I'm for sure getting a home inspection. I almost feel like I should get two. My girlfriend and I have written down every little thing that is somewhat questionable to point out to the home inspector (if our offer is accepted). So hopefully we can help in making sure they are thorough.

For sure. And try to make the sellers fix as much as possible before the sale/closing. If it is scheduled out beyond the closing date make sure it is in writing that it is paid by the seller and not the current homeowner which would be you by that time...

[jerseydave77]

For sure. And try to make the sellers fix as much as possible before the sale/closing. If it is scheduled out beyond the closing date make sure it is in writing that it is paid by the seller and not the current homeowner which would be you by that time...

And to add to this point: Be certain that you see paid invoices for all agreed upon work. When I bought my house there were three contractors who had not been paid and I picked up on the fact just before the signing. Before I signed the papers I saw those outstanding checks taken care of as they would have become my headache regardless of who technically owed the money.

Also, a big one, check out the neighbors. You will need to be very comfortable with everyone within a couple houses and across the street. I landed in a great spot but wrote off a couple houses based on the condition the next door neighbor kept their home.

[themean]

Do not get an adjustable rate mortgage unless you know for sure you are only going to be there for a couple years.

[finchbadass]

I don't want to be missing something obvious.

Thanks for any suggestions in advance!

make sure it has four walls and a roof. you will be pretty bummed if it doesn't.

[mattisr1984]

i am going through the same thing right now. only been looking for about a month and a half so im no expert but heres what i can share.

put an offer on a bank-owned house about two weeks ago. multiple offers came through literally the same day (so im told). multiple offer situation - had to give my "highest and best offer". was told (and read) banks like to play games where they'll drop the list price of the house substantially (say 15k) to incite offers and then turn it into a multiple offer situation. i lost the property so now im back on the hunt. if you read about this stuff online - some people suggest it can also be a scam by the listing agent to get you to bid against yourself and squeeze out some more money SOMETIMES but there is no real way to know.

im finding you cant have an emotional attachment to anything that isnt yours. look at everything objectively - price, location, condition, THE NEIGHBORS, etc. most of whats available here in my price range are lender owned. many of them trashed. problem is - banks dont give a shit about the properties and will not fix a thing and there is zero upkeep. im assuming thats not exclusive to here - so keep that in mind when looking at foreclosures. for sale by owner ive been told you have a lot more flexibility in asking for repairs, closing cost assistance, etc. but its still not as easy as it once was because property values are so low.

im also steering clear of short sales that aren't pre-approved - there is nothing short about them. waiting up to 6 months would not be fun. it was agonizing waiting 5 days for a response on the house i put an offer in for.

only other things i can think of are stay away from ARM and watch out for points or "buy downs" (where you pay your lender to lower your interest rate). personally, i plan on putting 20% down to avoid paying mortgage insurance.

[weck]

Do not get an adjustable rate mortgage unless you know for sure you are only going to be there for a couple years.

this as well...get fixed rate...

[kirbypuckett]

I've been reading into this stuff since I know the time will come for me to get a house in the future. I've seen a lot of mentions that you should check out the neighborhood at all times of the day, especially at night, ya never know how crazy a neighbor could be, heh.

A lot of people say to go for a 15yr mortgage instead of a 30, because the savings will be substantial.

Don't forget to consider property taxes and that, those can be quite large pending on where you'll be living.

[chiefwahoo]

Yeah I'm for sure getting a home inspection. I almost feel like I should get two.

Funny you should say this, it's what I was going to recommend. Not very conventional, but for the $200 a pop, it's well worth it. If I ever buy a different house, I won't hesitate to get two.

People will naturally try to cover up any problem areas. My insurance agent was able to tell me about a claim filed for flood damage in a basement that the owners did not disclose, even though they're required to by law. I'd inspect the hell out of the foundation. If you take a tall stick and stand it up against the wall, you can see if it is bowing at all. I'd also beware of fresh paint on basement walls that's covering up any water or mold damage. Also pay attention to areas that have moving boxes stacked up or something making the area less accessable than usual. That's an easy way to hide things. Inspectors aren't going out of their way to get behind things like that.

I learned most of that the hard way, unfortunately.

[thebiglebowski]

THE BEST thing you can do is buy the least expensive house that meets your standard of living.

I bought a house for $27,500, put $6000 into it to bring it up to my standard (new furnace, air conditioner, some windows, and a couple other small things). I could have afforded a $100,000 house payment, but went small. I paid that thing off in under a year (I had a large percentage of the cost saved already and borrowed the rest from an uncle, so there was no mortgage). I saved a ton in fees by paying cash and not dealing with a mortgage.

So now, one year later, I have my house paid off, my roommate pays me rent which covers all my utilities and more, and 100% of my earnings after living expenses goes into investments. Instead of paying 6% on $100,000, I'm making 10% on a small, but growing, amount of money every week.

I have no idea what your finances are like and you could be in a totally different financial situation, but starting small is good advice. You can (almost) never underextend yourself, but it is very easy to overextend yourself.

[thebiglebowski]

Also, go to the city and see if there is anything going on with the house.

Mine was "red tagged", which means the city has identified things that have to be fixed before anyone can live there. The selling agent was shady and tried to slip this by me. He took down the red tag on the property that identified this (illegal). Then he tried to slip in the sheet that says I would be responsible for all these repairs in with the avalanche of paperwork you sign when you buy a house.

I walked away from the deal initially, because I had no idea the house was red tagged when I made the initial offer. We went to the city, got the list, and went to the house to see all the stuff that had to get done. Ended up renegotiating the deal for $2500 less than the original offer because of this.

Usually the red tag only comes out when the house has been vacant for a while (ie foreclosed houses).

[jemsklile]

I don't want to be missing something obvious.

Thanks for any suggestions in advance!

make sure it has four walls and a roof. you will be pretty bummed if it doesn't.

Wait...what are those?

[mattisr1984]

THE BEST thing you can do is buy the least expensive house that meets your standard of living.

I bought a house for $27,500, put $6000 into it to bring it up to my standard (new furnace, air conditioner, some windows, and a couple other small things). I could have afforded a $100,000 house payment, but went small. I paid that thing off in under a year (I had a large percentage of the cost saved already and borrowed the rest from an uncle, so there was no mortgage). I saved a ton in fees by paying cash and not dealing with a mortgage.

So now, one year later, I have my house paid off, my roommate pays me rent which covers all my utilities and more, and 100% of my earnings after living expenses goes into investments. Instead of paying 6% on $100,000, I'm making 10% on a small, but growing, amount of money every week.

I have no idea what your finances are like and you could be in a totally different financial situation, but starting small is good advice. You can (almost) never underextend yourself, but it is very easy to overextend yourself.

27500 for a house that just needs that amount of work? jealous. whats the sq footage?

ive looked at homes here that are 100k with extensive water damage plus other repairs.

[jemsklile]

THE BEST thing you can do is buy the least expensive house that meets your standard of living.

I bought a house for $27,500, put $6000 into it to bring it up to my standard (new furnace, air conditioner, some windows, and a couple other small things). I could have afforded a $100,000 house payment, but went small. I paid that thing off in under a year (I had a large percentage of the cost saved already and borrowed the rest from an uncle, so there was no mortgage). I saved a ton in fees by paying cash and not dealing with a mortgage.

So now, one year later, I have my house paid off, my roommate pays me rent which covers all my utilities and more, and 100% of my earnings after living expenses goes into investments. Instead of paying 6% on $100,000, I'm making 10% on a small, but growing, amount of money every week.

I have no idea what your finances are like and you could be in a totally different financial situation, but starting small is good advice. You can (almost) never underextend yourself, but it is very easy to overextend yourself.

27500 for a house that just needs that amount of work? jealous. whats the sq footage?

ive looked at homes here that are 100k with extensive water damage plus other repairs.

Yeah. That is an amazing price. In Minneapolis most decent starter houses in a good neighborhood that would still need a fair amount of work are in the 120,000 - 150,000.

[drabley]

I've been reading into this stuff since I know the time will come for me to get a house in the future. I've seen a lot of mentions that you should check out the neighborhood at all times of the day, especially at night, ya never know how crazy a neighbor could be, heh.

This. Neighborhoods change drastically under cloak of darkness.

Before living anywhere in New Orleans, I always drive out to the place around 11 or 12 and park for a few hours to see what goes on while I'd be sleeping. You'd be amazed, and I actually passed up on buying a house just because of the nocturnal activity.

I'd also advise living close to where you play, not where you work. Work is work (and also pretty much mandatory) so the commute will not dissuade you from doing it. Conversely, if you live 25 miles from the nearest entertainment you'll be less inclined to go out and be social and your quality of life will suffer greatly.

Leave the rest up to the professionals that you're paying.