Just bought a house

[skeeter14 0]

Hey Everyone,

So my Fiancee and I are in the process of closing on a house, and are freaking out. Any advice to calm the nerves of a first time home buyer?

[Jason Harris 31]

I thin congratulations are in order more than freaking out! Maybe it will be years and years of paying it off, but there would be just as many years of paying rent -- with no net worth at the end.

Do what you can to pay extra. I think we've been paying slightly more than $50 each month and it's cut off somewhere between 5-7 years of payments.

[coryroth24 15]

First and foremost, find your spot and claim your equipment storage area. Then, no joke, once you have everything in the house, grab your honey, a beer and just sit on the couch and take it in. It helps to make a list of things to do as well. I got this little notebook 7 months ago when I got my first house. Has everything from "Must Do" to "Want To Do" lists as well as the endless account of my Home Depot runs. Good luck and ENJOY IT. That's the only way you're going to be a successful home owner is if you enjoy it.

[Goonsquad 209]

Hey Everyone, So my Fiancee and I are in the process of closing on a house, and are freaking out. Any advice to calm the nerves of a first time home buyer?

Relax. . if you are buying from previous owner find a home inspector to check things out to cool the nerves.. its a lot of money but worth it..

[team50 20]

A good lawyer is invaluable.

[gerbe3:16 19]

Hey skeeter, congratulations. I echo the above post about getting a good inspector. Also, check every inch of that house yourself and make note of anything you don't like. Probably cheap fixes buyers would go for in order to get a sale done that will save you a lot of time and hassle. Good luck.

[chippa13 1844]

As long as you made sure to stay within something you can afford and still eat and the home inspection went well then you've got nothing to worry about. Sign the papers and enjoy.

[Raft 0]

Just make sure you can afford Beer and Pizza on the weekends and you will be fine. My wife and I bought our first Condo 5 months ago and couldn't be happier! It is nerve racking and a big commitment but overall we are very happy and pleased with our decision.

[Chadd 916]

You don't have to take on every home improvement project at once. Make a list of small and big projects and only take them on one at a time and only when you have the resources to do so. We got the seller to throw in a two year warranty and it saved us when the water heater died. You also might want to start a slush fund in case you have a major expense, at least enough to cover the deductible on your homeowners insurance. Speaking of that, you might want to inventory any valuables with pics and serial numbers if you don't have that for your renters insurance.

[skeeter14 0]

Thanks everyone for the advice. It's still a "what the..." type of moment, but like almost all of you have pointed out, that will eventually go away.

We have a good lawyer, and with my Fiancee off to law school herself, we should be in pretty good shape. The concern right now is paying for it. Not that we can't or got one where we can't pay for it. But it's actually getting that done that is our biggest "concern", if you want to call it that.

If you guys have any more advice, Id be more than up for it.

Thanks!!!!

[wrangler 157]

The mortgage may feel like something huge hanging over your heads, if you focus on the amount of the debt. Look at the monthly payment instead; it's just something to budget for, as you would do with a rent payment, but you have the added benefit of building equity.

[Jason Harris 31]

Chadd's post calls to mind something we learned over the years about homeowners insurance.

My brother-in-law's washing machine overflowed and flooded the first floor. He got new rugs and paint throughout the bottom floor, which seemed to be a pretty good tradeoff. That actually turned out to be a bad lesson we learned, because we had two separate leaks, one of which I could easily fix myself, yet we called insurance both times. Long and short of it is the insurance industry was going through a tough time because the Dot Com bubble had burst in the stock market, so their investments were tanking and they needed to pull in more money from their customers. Our rates tripled for the next three years and it was impossible to switch, because there seems to be a handshake agreement within the insurance industry that, "Hey, if we all agree we won't take on anyone who has a 'mark' on their records, we'll all be able to hold the line on prices." Sure, I'd call that an oligopoly, but I think most insurance companies have found it's equally effective to invest in Congress as well as Wall Street....

And that story calls to mind a series of articles I read years ago about a shifty practice within the insurance industry. One example was a tree fell on a guy's garage, so he called up his company and asked if it was the type of thing his insurance covered. When told yes, he hung up and decided he'd do the repair himself. The next year, his rates went up, so he called up his insurance company to ask why. He was told it was due to his phone call of the previous year. When he protested that he never used them, their reply was along the lines of, "Yes, but that call is indicative of other potential problems your home might have," In other words, the insurance company was saying the home didn't appear as seaworthy, and they'd be obligated to pay for some of the repairs, so they were protecting themselves by collecting more money upfront. Some states have tried to make this practice illegal, stating that only actual usage of insurance funds should lead to higher rates, but I'm not sure if any of the laws have ever been enacted.

The bottom line in everything we've learned about homeowners insurance is it's an emergency fund, meant to be used only for catastrophic repairs, not when a leaky toilet caused a few tiles to pop up.

[DEATHTRON 19]

I'm assuming this is almost a done deal for you seeing as you are closing, however; Look into getting a 15year mortgage instead of a 30 year note. It will cost a few hundred a month more, but the amount you will save in the long run is astronomical. Also, it more or less takes some of the burden off thinking youre committed to a loan for 30 years. 15 is much more manageable, and usually interest rates are lower as well.

Also, home repairs/modifications are mostly easy. Ill give you an example: When I bought my condo, I decided to do recessed lighting after getting quotes for anywhere from $50 to $100. After going to home depot, talking with someone people there, my dad and I decided we might be able to do it.

The total cost with lightbulb was around $30 per can (dimmable CFL was about $19 of that), and it was the easiest thing to do in the world. When then tackled my hard wood floors...and would'nt you know it, also extremely simple and saved thousands.

In all, I learned throughout the whole process that owning is actually cheaper than renting and that contractors make entirely too much money for simple tasks.

Zach

[skeeter14 0]

I'm assuming this is almost a done deal for you seeing as you are closing

As an update..... My fiancee and I went from a deal on Monday, to nothing on Wednesday. The seller pulled out at hour 71 of the 72 hour attorney denial period. Apparently after accepting our offer on Monday, she had a showing that night, where the person seeing the house said that if they would be making a "cash offer". No dollar amount was mentioned, just their intent. The seller felt after talking to their lawyer, that they were better suited to take a chance on a verbal intent to offer, than the sure thing of us and closing 2 months from now. There are a lot more details that I could type out, but that's the general jist of it.

After being pissed for a good while Wednesday night, my Fiancee and I took up the advice of our mortgage person....that "a house isn't a home until you make it one. Until then, it is just a piece of property that you are purchasing", and are moving on. If we don't find anything and it's on the market in the spring still....we may consider it again, but our offer will significantly drop. Thanks for all the advice though, because it will (eventually) become valuable!!!!

[coryroth24 15]

Damn, don't know what's worse, the shit they just pulled on your or the BS our seller pulled. He decided on the day we were supposed to close that he would go to the bank and rework the THREE mortgages he had on our house. Waited to the LAST DAY! He had over a month to do this. He had to use his other properties as collateral, yada yada yada... Safe to say, that was a long 16 hours in the real estate office...

[Jason Harris 31]

We had a similar situation when we purchased our home, but that makes me a bit confused about both of your circumstances.

Our story briefly: We were moving states and my wife, who's the breadwinner, didn't yet have a job, so our offer was a lease-purchase. Most times people offer a lease-option, which says maybe we'll buy the house after X amount of time, but the lease-purchase says we WILL buy the house in X amount of time (in our case, six months). Closing day came and I hadn't heard from our realtor, so I called him in the afternoon and learned the seller was getting cold feet. Turns out he was going through a divorce and wanted to be out of the house ASAP. However, we wanted that house, so we spoke with a lawyer our realtor recommended, who spoke with the seller's realtor for about three minutes, before the seller's realtor called the seller to tell him, "You'd lose immediately if this went to court."

By that point, The Big D had already been hired by a company in Denver, so we were able to buy the house instead of using the lease-purchase, but the one mistake I realized we made is we didn't take advantage of having the upper hand. We should have told the guy we'd be willing to buy the house immediately, but he had to knock off some money from the price; otherwise, we'd be willing to go to court to come to the same conclusion. I really wouldn't have wanted to go to court, but hopefully the bluff would have been enough for the guy to realize that if he wants to change the deal, he has to be willing to make a concession.

So what confuses me in both of your cases is you had signed contracts, right? I know there are contingencies built into the contracts, but they usually cover things like the buyer not being able to obtain a loan.

[wrangler 157]

skeeter14 -- Sounds like you weren't exactly "in the process of closing" as you stated, but had live contingencies. I don't know the law in your jurisdiction, or even which jurisdiction you're in, but in some places, the attorney approval contingency is restricted to certain things, which exclude purchase price. But, even if the seller isn't legally entitled to avoid the contract, enforcement could require going to court, and that's a major hassle.

***

JH, I don't understand how you figure you could have persuaded the seller to accept less money than the contract called for, once he agreed to follow through on the sale. Or did you intend "closing day" to refer to something other than the day you were to buy the house? I don't understand what might require "closing" once there's been a written contract for lease/purchase, until the time of sale completion.

[Jason Harris 31]

No, I was referring to closing day as the day on which we'd be able to move into the house, thus starting the clock on our six months, because that was how the contract was written. I understand your point, however: How could there be a closing when we move in as renters, since title wouldn't transfer until up to six months later?

The seller breached a contract because he didn't want to be to tied up in a house for six more months while he was going through a divorce. At the same time, however, I believe we were the only offer he had had over thirteen months in a market that was red hot. The house has a funky layout, and he and his realtor chose a terrible marketing angle, along with greatly overpricing it. Knowing that he didn't have any other buyers, and knowing he had been the one who breached, I should have said, "Sure, we're willing to help you out by getting a loan earlier than anticipated, but you need to give us something in return. If not, as your realtor has already told you, a judge would force you to comply with the terms after about 15 minutes of a hearing."

[skeeter14 0]

skeeter14 -- Sounds like you weren't exactly "in the process of closing" as you stated, but had live contingencies. I don't know the law in your jurisdiction, or even which jurisdiction you're in, but in some places, the attorney approval contingency is restricted to certain things, which exclude purchase price. But, even if the seller isn't legally entitled to avoid the contract, enforcement could require going to court, and that's a major hassle.

Yeah, it appears I mispoke/got a bit ahead of myself. We were in the live contingencies stage, and the one she took advantage of was the Attorney Denial Contingency. As far as where I live (upstate NY) I guess in the 72 hrs after an offer was accepted, they can drop out via their attorney for virtually any reason. She did exactly that. We were more angry at the fact that she accepted our offer, continued to have a showing and when she decided to roll the dice on this other persons intent to make a cash offer, she didn't contact her agent, she went through her lawyer, who snail mailed our lawyer, who told us. Just seemed like an immature thing to do, even though she was completely within her legal rights to do that.

[RadioGaGa 162]

Add Real Estate to the lsit of things that are handled very differently in Canada and the US. I think here...once an offer is made you can't continue to show. I know there were a couple houses I wanted to see...and my realtor told me "You can't until Wed when the offer expires"

[skeeter14 0]

Add Real Estate to the lsit of things that are handled very differently in Canada and the US. I think here...once an offer is made you can't continue to show. I know there were a couple houses I wanted to see...and my realtor told me "You can't until Wed when the offer expires"

Seems a bit fair, otherwise what's the point of accepting an offer if you aren't held to it, save for some reasonable reasons? Funny too, seeing as my fiancee are the only ones who made ANY offers. Lots of showings to others that never materialized to actual offers. But in hearing from our agent, the sellers lawyer gave her a doom and gloom story of how financing on mortgages falls through and she should take a cash offer if available.

I get that, it makes sense, and her lawyer is looking out for her interests (he specializes in bankruptcy law, and does minor real estate here and there). But it's her loss if this doesn't pan out (the cash offer that is)

[Chadd 916]

Seems a bit fair, otherwise what's the point of accepting an offer if you aren't held to it, save for some reasonable reasons? Funny too, seeing as my fiancee are the only ones who made ANY offers. Lots of showings to others that never materialized to actual offers. But in hearing from our agent, the sellers lawyer gave her a doom and gloom story of how financing on mortgages falls through and she should take a cash offer if available.

I get that, it makes sense, and her lawyer is looking out for her interests (he specializes in bankruptcy law, and does minor real estate here and there). But it's her loss if this doesn't pan out (the cash offer that is)

We got really lucky with our place. We were already approved for more than the asking price when we saw this house and decided to make an offer. We talked to the agent showing the house and put in an offer a day or two later. Since he didn't have to split the commission, he ended up kicking back a chunk of it into the closing costs for us. This place cost less and was nicer than most of the other houses we had seen. As long as you don't force it, you'll end up in a place that just feels right the first time you walk in.

[skeeter14 0]

This place cost less and was nicer than most of the other houses we had seen. As long as you don't force it, you'll end up in a place that just feels right the first time you walk in.

That statement right there summed up our feelings on this house. However, I guess it wasn't meant to be. Any bitterness I have is placed strictly on the seller and their level of professionalism, or lack there of.

[wrangler 157]

The contingencies are generally spelled out in the contract, and your lawyer should have explained them to you.

[skeeter14 0]

They are/were. NYS just sucks (or is great depending on your perspective) in that you can bail anywhere in that 72 hrs for any reason.