Buying a House

[Teallaura]

I debated putting this in the Chapel - prayer would definitely be appreciated!

I finally have enough ducks more or less in a row to actively pursue buying a house. I've never bought a house before so I'm kinda nervous (okay, very nervous!). I have been browsing listings for years so yes, I have looked at those but I'm not actually hunting yet since I'm not pre-approved yet.

So, game plan:
1) Pull credit reports and make danged sure they are correct.
2) Apply for financing.
3) Fix whatever went wrong with financing and try again (I'm hoping to skip this step).
4) Get financing...

At this point I hit a snag - I'm not sure about hiring a buyer's agent. Being inexperienced it seems a good investment to have an agent that unquestionably represents me. It's not like I need an agent to find listings - they're everywhere. But then again, I'm not certain it's necessary, either. Opinions?

5) Begin active hunt - seeing properties.
6) Pick one
7) Get independent inspection - I don't expect perfection but I would like to know what I'm actually getting into. No falling in love without an inspection!
8) Repeat steps 5 - 7 until ready to make an offer.
9) Panic - my Mom liked real estate law - I don't.
10) Calm down, sign stuff I've read. Write large check.
11) Panic again - I know me. It's not a matter of second guessing - I just usually have the really bad reaction after the crisis.
12) Move in.

Originally, I'd considered looking at foreclosures but given the current legal issues I will avoid them. Getting clear title is bad enough without jumping in a quagmire.

So, those of you who actually know what you're doing - or have at lest survived the process before - what do you think?


Oh, and remember, prayer is greatly appreciated!

[justgin]

I debated putting this in the Chapel - prayer would definitely be appreciated!

....
9) Panic - my Mom liked real estate law - I don't.
.....
11) Panic again - I know me. It's not a matter of second guessing - I just usually have the really bad reaction after the crisis.
.....

Omit steps 9 and 11, and you'll be fine. It's not that big a deal.

[Teallaura]

Thanks. I may be convinced of that... after wards...

[justgin]

A person who panics makes bad decisions. Capiche?

[Teallaura]

That's why you panic after wards

[Raphael]

Just remember, in your budgeting, you will have increased expenses like more insurance, rates etc.

Not that those are issues, but when we bought our first house, nobody thought to mention them so it wasn't budgeted and our first month was our own little financial crisis.

[DesertBerean]

What Raphael said. I did get a heads up on those expenses...property taxes, etc.

Absolutely have that house inspected for EVERYTHING! I made the mistake of skipping on the roof inspection, and now have some repairs that should have been done back then . Either somebody lied or that inspection WAS an optional item I had to pay for. Roof looked good to me, so I didn't pony up the money.

[DesertBerean]

Oops, forgot to mention, getting a buyer's agent might be worth it. I understand that the way it works is, the agent gets a percentage of the money along with the seller's agent, so you may be paying BOTH agents. Can one require that the seller pay their agent out of their own pockets?

[Raphael]

Oops, forgot to mention, getting a buyer's agent might be worth it. I understand that the way it works is, the agent gets a percentage of the money along with the seller's agent, so you may be paying BOTH agents. Can one require that the seller pay their agent out of their own pockets?

In South Africa and New Zealand, the seller's agent gets their money from the seller (normally between 3-5% of sale price), surely the US is the same?

We don't have buyer's agents, so can't comment there.

[Teallaura]

According to these guys the two agents share the fee so there isn't a cost increase. I'd forgotten that.

[mikewhitney]

make sure to have interest rate and loan amount written on each page you sign. unscrupulous loan brokers can switch papers in and out of what you are signing. I think also you have to put a date on any initials you make, lest those are swapped out.

get a copy of everything you sign, and if they don't get the papers to you, you make sure they have a letter given to them saying not to proceed (and served upon them with a witness).

[Cow Poke]

Just remember, in your budgeting, you will have increased expenses like more insurance, rates etc.

Not that those are issues, but when we bought our first house, nobody thought to mention them so it wasn't budgeted and our first month was our own little financial crisis.

AND, a lot of people scrape together all their money for closing, but additional costs are deposits for utilities and drapes or other things you'll want pretty much up front. Don't forget to have the locks changed.

[Dee Dee Warren]

Don't balk at foreclosures Teal. I don't know your level of knowledge, but any lender will require you get title insurance at closing so you will be protected. Just make sure that not just the bank is protected and you are a named insured on the title insurance policy.

[DesertBerean]

Hm, yes! They will do a title search. Scour that report. If you should get an agent s/he would be very useful here.

[Teallaura]

Thanks, everyone!

I knew about title insurance - and would want it in any case. But I really don't want to get into a house and then have to move due to a title problem - I'll think about it. Thus far the crisis seems to be paperwork and not actual improper foreclosure so that may not be as big an issue as I initially thought.

Mike, my kind of paranoia! I'm copy obsessed as it is but I'll be extra careful now.

I had figured on budgeting the deposits/moving/misc early on and shoving that into a separate account (adding new locks - hadn't thought about that one). Closing worries me because it's so unpredictable. I plan to pad accordingly in that account.

I'm thinking I will go the buyer's agent route, DB. I'd rather hire someone I know is looking out for my interests (and is legally liable if they don't - not very trusting, am I?) than find out the hard way that the seller's agent is less than forthcoming...