OT: Buying a House

Rachel0778

So this is completely off topic from weight loss, but my SO and I are gearing up to buy our first home this Fall. We haven't started the process yet other than agreeing on a price range, down payment total, neighborhood, and style of the home we want.

So from the wise GOAD community: any words of wisdom for first time homebuyers?

And maybe a more on-topic question: how do you deal with the stress of giving up the vast majority of your savings when you first buy a home? The home I grew up in was lost in the 2008 financial crash so I definitely have some anxiety around home ownership.

GoRun2

Breathe and go for walks or runs.

When we bought our first house years ago, a co worker asked if I was pregnant because I looked so awful in the morning. I wasn't, just stressed and she was snarky.

Best of luck in your house hunting.

Out_of_Bubblegum

We bought our first (and still current) home 8 years ago, during the big housing downturn. This is some takeaways from that process.... It took us 6 months to buy our house, and it was a bit of a wild ride.

1. Make a list of everything you MUST have. Make it as short as possible... Stick to the stuff that is very important. Main features you can't live without (i.e. min number bedrooms... location.)
2. Make a list of everything you would LIKE to have.. These are bonus items, things that will give you pieces of the dream, so to speak.
3. Negotiate with your SO on which items from #2 really belong on #1, and vice versa.. get this out of the way BEFORE you start looking at houses.
4. Get a good realtor... Talk to friends and find out who is good. They are going to be your ally and help you make this a great experience... or they are going to leave you swimming in a shark infested pool. A GOOD realtor makes a huge difference... we fired 2 before we found the right one... and she has since become a close friend of the family, because she is Awesome.
5. Give these lists to your Realtor.
6. Go talk to a few different banks and lending agencies and get pre-qualified for a loan. Get your pre-qual letter so you can include it in offers. It doesn't help much, but it might make the difference if there are competing offers of the same price.
7. Go look at some houses with your realtor. You might get lucky and find your dream home right away... or not... and that's OK.
8. If you see a house on the MLS that you want to see... don't hesitate. Get in there and see it right away. If you are in a popular neighborhood, it might be gone in a matter of 24 hours. The house we bought, we made an offer 12 hours after it was listed.. and there were 4 other offers within the next 6 hours before we heard back from the owner.
9. After looking at some places.... revisit your lists... You may find that after looking at what is available in your price range, you may want to adjust your lists.
10. When you find The House.. make an offer, but try not to get too attached just yet. An offer alone does NOT guarantee you will get the house. It took us many offers on different houses before we got ours. Listen your realtor on the offer suggestion (though the offer price is totally your decision)... It's their job to know what kind of offer to write up to give you the best chance of making that home yours without giving away extra money.
11. If you are going to make an offer.... be ready to pay for an inspection. Make sure that your house isn't going to cost you both arms and a leg in repairs.
12. If the inspection turns up something ugly... don't panic. See if the current owner will get it fixed to help close the deal. You might get some free upgrades out of it.
13. Learn all you can about the loan approval/closing process... Get to know your lending agent on a first name basis, and keep in contact... Learn how it works, and keep your eye on the process.
14. When you enter escrow.... hold on to your butts. It's going to be a bumpy ride.
15. The lender WILL make mistakes. Or the realtor will.. or the seller will.. or the seller's realtor will.
16. These mistakes make the process slow to a crawl... Be patient, and stay in contact with your agent and realtor. Daily if need be.
17. Our realtor bought all first time home buyers a home warranty.. paid for it out of her commission (Told you she was awesome) - if yours doesn't... get one. This will help buffer against unknowns for the first few years while your savings recovers.

minimyzeme

Good luck @Rachel0778 ! And @bwmalone , that's a great list of suggestions (wish I'd had something similar when we were house-hunting!

DavidKuhnsSr

That is a great list. As one who has purchased and sold three homes before building a fourth - now there is a bumpy ride - I would make a couple more observations.

We have worked with six realtors. It is important to remember that they work for the benefit of the realtor. That might align with your benefit, but not necessarily. Don't let them push you into anything.

Don't be "house poor." Think long and hard about how much you really can pay every month. If your current rent is a comfortable expense, that is a good place to start. There are lenders, still, who will let you borrow more than you can pay back while still maintaining the lifestyle you currently enjoy. And remember you still need to be able to set aside money for savings, retirement, etc.

Nothing lasts forever. Buy a home with an eye toward selling it. Quirky things you might find charming might make it difficult to sell if your circumstances change in the future. As the cliche' says, location, location, location. Another good rule is to buy the cheapest house in the best neighborhood you can afford.

Philtex

Consider a new 'starter home' rather than an older one where you might have to replace major items in the not-too-distant future (roof, A/C unit, hot water heater, dishwasher, etc.).

Rachel0778

@bwmalone, @DavidKuhnsSr and @Philtex Thank you so much for your suggestions! This has definitely been an anxiety provoking experience to say the least and we haven't even started so I appreciate your wise words of wisdom. We are definitely looking for a newer starter home since neither of us are considered handy by any stretch of the imagination. And we're fortunate we have a realtor in the area that 3 of my family members have used in the past and loved (and hasn't steered them wrong yet) which makes me feel slightly better about that process, although I doubt we'll be fortunate enough to have him pay for the home warranty out of his own commission- your realtor sounds amazing @bwmalone! Wish us luck this Fall that we find a keeper!

misterhub

Remember to see things as they could be, not as they are. It is really easy to get caught up with seeing the way a room is currently painted instead of visualizing how you would paint it. How it is decorated now instead of how you would decorate it. How ugly that carpet is instead of how pretty those hardwood floors you're going to put in would be. When you buy the place, it will be YOUR place, not their place.

I would also add that you should steel yourself for the signing meeting. You're always going to be nervous when it comes to signing a mortgage. Always. But, you can prep your mind and concentrate on the pleasurable plans you have for your future. Plus, be prepared for how long it will take. You will initial and sign until you think your hand will fall off. But, if you know this beforehand, you can prepare yourself and not be caught off-guard by it.

I think this is wonderful, and I hope you find exactly what you want.

Out_of_Bubblegum

I'm sure you will find a great home - having a realtor that has a track record with your family is a great start.

One thing I left off the list...

Have fun. Every time you look at a house, you get to dream about what it might be like to live there... and when your realtor puts up the sold sign on the sign.... Go take a picture with it, because it's an awesome moment.. and when you get handed the keys, it's like no other feeling - the closest thing I can equate it to is like getting the keys to your first car... x 100.

podkey

wow lots of good advice. Hey and smile and enjoy yourself along the way I say.

Rachel0778

@podkey and @bwlamone I definitely needed that reminder! It's way too easy for me to get wrapped up in the stress and not enjoy the process

@misterhub I wish I had more of a sense of style (I'm a bit hopeless) so I'm hoping whoever was before me in the house chooses decent colors or the Home Depot person can recommend one! Thanks for the warning on the signing, I'll come prepared with snacks and a latte

spospo1

It is a fun & exciting time so enjoy it. Know & stick to your budget (as previously stated, don't be house poor) and have an emergency fund for unexpected issues because they will happen. Come on in.....the water is fine.

misterhub

@Rachel0778 Read a few house renovation/decoration magazines. Maybe you can't picture something from your imagination; but you can identify some things you like in the mags and be able to draw them to mind as you view the houses. Almost all floor plans are limited to just a few - all of which will be represented in the mags. No need to reinvent the wheel. Carry the mags in a little bag so you can pull out one that most closely matches real life. You only have to do this for houses you really like. No need to waste your time on the others.

Rachel0778

That's a great idea @misterhub. I'll definitely have to start looking around. And @spospo1 thank you for the advice on the emergency fund. I keep reminding myself that a large portion of adults own homes so I should have no problem joining the ranks. The 2008 financial crash hit my Dad hard and he lost the home (I was already grown and out of the house at this point, but it still freaked me out about home ownership).