Buying a Home

SpringerLover

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#1
So, I got a raise. And it means I make real money. I really, really want to buy a house. I can't afford to yet, but I could feasibly afford to within the next six months.

I've started looking at properties, and now I can't stop looking!

Home owners: where should I start? And, what's okay to compromise on and what isn't?

I do NOT want a fixer-upper, nor do I want an old house. I don't mind replacing carpeting or doing floors but I don't want major repairs. One house I looked at needed all new kitchen appliances (well, they were super old looking, so maybe not "need" but definitely would want), but the rest of the house looked nice.
 

Laurelin

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#2
Well ideally you want 20% down or you're going to have to pay PMI. And then after that the rule of thumb I've heard is 2.5 x salary to get how much you can afford. Beyond that... I know I want a yard and also at least 2 baths and 3 bedrooms. And within the same distance from work as I am now or closer.
 

SizzleDog

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#3
We had zero downpayment and we were not required to get PMI.... we used a USDA rural development mortgage. We did kind of move to the boonies to get it though. ;)

Our mortgage is low too - it was a great deal.
 
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#4
There are options to avoid paying PMI. A lot of people don't put 20-30% down anymore. Some lenders offer different options. If you go with an FHA loan, you'll pay something similar to PMI but I believe it's a lot cheaper.

I don't know a lot about the financial aspect of it, I kind of tuned all that out lol. I would talk to a bank/lender and figure out your price range - they can fine-tune the calculations to your specific situation. Do you have an idea of your credit score? That will affect things as well. What you're "approved for" is usually not the same as what you can afford. The house we have was at the higher end of our "what we can comfortably afford" range. It was in the lower half of the "what you're approved for" range.

Get a realtor! Once you find a realtor that you like, they can help you through the whole process. Most realtors can access any listings in the area.

As far as choosing houses goes...we looked for well over a year. I would make a list of your absolute "must haves (or "must not have") qualities and a list of your "preferred" qualities. Keep in mind what can be changed and what can't be changed. If a "must have" is a fenced yard...don't rule out places with a yard but no fence. You can always add a fence as long as the property is there. You can always update appliances, you can't really change the layout of the house. Visit the house/area several times, at different times of day and on the weekend, to get a feel for the area, how busy/quiet it is, etc. Be realistic about what you want to fix/update, and figure that into your price range.

If you're looking anywhere that has an HOA (usually town homes or developments) get a copy in writing before you go look and get attached. Most are not very flexible about pets. And have other weird rules.

And lastly...yay! I'm so excited for you!
 

joce

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#5
First thing to do is get a good mortgage broker. They will tell you what you can afford and if you are realistically ready with credit scores and work hx etc. they will tell you the million different options out there for loans. We loved ours who answered questions day or night and on weekends.

We had multiple realtors and not a one was worth anything. We did all the work with every one. They just submitted offers.

We saved more than twenty but needed to redo everything in the home so only put 3.5 down on a conventional loan. FHA would have been higher interest rate and more pmi.

It was hard for us with certain acerage and school requirements. If not for that a ton if houses would have worked and probably would have had one in a month or so. Ton out there.

Look at what's in your area and prices. You'll get an idea of what's a good deal because realtors are full of it. Seriously had them lie about things like acerage and many other things.
 

stardogs

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#6
Lots of good info above!

I will also add that even 'move in ready' homes are not truly move in ready for many folks - there are stupid things like changing door knobs, painting over hideous colors, etc. even if there's nothing major that needs to be fixed or updated. This means that you will want to have a cushion of funds to use after you've paid your downpayment and closing costs. I think we spent $3k in the first year of owning our home and that was with very few big purchases.
 

-bogart-

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#7
We had zero downpayment and we were not required to get PMI.... we used a USDA rural development mortgage. We did kind of move to the boonies to get it though. ;)

Our mortgage is low too - it was a great deal.

I am actually going to start this process tomorrow , hopefully that is . I am tired of the city grind. Is this process a long one and do you recommend going thru a broker or going to the rural office our selves?
 
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#8
So, I got a raise. And it means I make real money. I really, really want to buy a house. I can't afford to yet, but I could feasibly afford to within the next six months.

I've started looking at properties, and now I can't stop looking!

Home owners: where should I start? And, what's okay to compromise on and what isn't?

I do NOT want a fixer-upper, nor do I want an old house. I don't mind replacing carpeting or doing floors but I don't want major repairs. One house I looked at needed all new kitchen appliances (well, they were super old looking, so maybe not "need" but definitely would want), but the rest of the house looked nice.
always expect the unexpected :) There is always something when buying a house. not always, but usually. :)

Our first house had major leaking from the roof the first spring we were in it. Since it was disclosed in the damage report, and reported as "fixed" they were off the hook as sellers. How that works I don't know, but it certainly wasn't fixed. Also found out at that time that home warranties aren't worth a pile of beans, so don't ever let that sway your decision :)

Somehow the home passed inspection, even though there was no roof ventilation and bath and kitchen vents were put right to the attic that had no ventilation because they didn't put the roof rafter vents in. Needless to say there was mold in the attic.

i'm as mad at myself as the inspectors, because I didn't go look at that myself before we bought it. It was our first and I was more concerned with what I could do to the place. I stupidly relied on someone else to be competent at their job and nobody from the framers, to the insulators to the inspector, neither home, nor presale inspector did their jobs correctly. Another lesson learned :)

on another we were "just changing cabinets" and once we got into the walls found some of the most horrific hack job of electrical work one could imagine. It was as if someone was trying to burn down their home. We pulled lots of new wires and got rid of a lot of old stuff. Lots of extra work involved. I'm am thankful my father is a contractor and I grew up doing this stuff. I'm also thankful he was there to help us.

Another house, can't believe this wasn't caught at inspection, but a live wire was run along the floor in the living room. Along the ****ing floor!!! and then was tucked back behind some trim and disappeared. I though, hmmm, this is odd and rather large for a doorbell :) because that's where it appeared to go, to a downstairs doorbell from near our front door.

well I followed it one day and it was a live, un-sheathed power wire used to power a 3 way circuit between the front door and garage and outdoor lighting. it ran along the top of the poured basement wall once it was tucked behind the trim and brought down thru the floor where it came thru to the inside of the garage wall and was then pulled straight across a corner, bare to the world again, then up the wall to the switch.

It always amazes me what "professionals" will do, though I suspect this was not done by a professional, but a pro did miss it during inspection. I'm neither an electrician or home inspector and I caught it, why didn't they?

and these were just on homes we've had, not all that old either. Between homes we rented till one sold. Right before we moved in, the place was remodeled inside and new roof and siding was installed, by a professional, and I use that term loosely. I didn't know who did it, but apparently they have a good reputation around here.

Well the roof has been replaced and the siding is next. over simple, simple stuff. I hate to see the problems this owner would have had, had I not informed her. The roof, brand spanking new. very nice shingles, top of the line. Could have been a 30 year roof on asphalt, very goo quality. Put down by people that didn't know their ass from a hole in the ground.

Ever single shingle was nailed above the nail line and with too high of pressure. 1/2 the roof started sliding off because nothing was actually secured to the roof. How it didn't fly off, myself nor the 3 other contractors that came to give her estimates, can't figure out because it should have. Such a simple and easily correctable thing ruined an entire roof.

The siding?? we won't even get into it, but it too is being replaced. It looked ok from the outside to someone that doesn't know what they're looking for, but it was a horseshit job. No undersill used, j-channel draining behind the siding, not out and away, no metal flashing used along roof or deck, etc. so I went into it a little bit. and this is all work done in the here and now, again, how does this get passed off as professional work? and pass inspections?

anyway, long story short, do your homework, check over at least all the big things with someone you know and they know what to look for. Don't rely on others to have done their job. There's a good chance at least one person a long the line didn't do something correctly and eventually someone is going to have to dig into everything and fix it. Be prepared for the unexpected, meaning don't stretch yourself on the purchase, leave a decent amount for unforeseen repairs.
 

xpaeanx

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#9
oooooo! How exciting! Congrats on the raise and Congrats on being able to start looking at houses!! :)

I'd say what you can and can't compromise on is entirely up to you. It's going to be your house so you get to choose what it must have and what you don't care about. But, a lot of things you want can often be added in later... so if you find a house that has what is needed to put in what you want but doesn't actually have what you want, don't cross it off right away.
I have a pretty handy guy so things that need to be fixed or upgraded don't really bother me(plus to be perfectly honest I care more about the land than the house... I could totally live in a 1 bedroom cabin as long as it had plenty of land and a few barns. haha!), but when it comes to houses buying a house with "older" appliances is usually cheaper and you can always swap those out later. That is something that may help you get more of the house you want in the end, but you'd have to decide if you can live with older appliances for a while or if you just want new right away.

also, shop around- for houses, mortgages, realtors, etc. I know a lot of people that just jumped into things and compromised on stuff they really wanted because they needed a house *now* and than shortly after closing wished that they had actually been more patient because what they really wanted popped up.
 
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#10
I am a fan of buying less house than you can actually afford, unless you hate all your choices at a lower price. Through a long and boring sequence of events, we ended up with a home that cost about half of what we qualified for, and man that little cushion every month is nice. You can always pay extra on your payment, but you can't pay less than your minimum. Years ago a company that my husband worked for folded and he was out of work for about six months, it sucked but we survived and we never seriously had to worry about losing the house. I can't imagine how we would have with a higher mortgage payment.

You're not going to find a house that is absolutely perfectly everything you want, so you have to prioritize what features are more important than others, what things you're willing to live without or live without until you can add/fix them (eg fence). But there's a difference between compromising and settling, kwim? You're in the perfect situation to hold out for something that really works for you - you don't have the time pressure of trying to coordinate selling one house while trying to buy another, so don't rush into anything.
 

joce

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#11
We used just my income to qualify for the loan so that we had left over money. Also knew we would be buying tractor and building barn etc.

Careful with home inspectors like someone above said. Ours went above and beyond and was here more than six hours! Showed us everything! In comparison my boss sold his house and the inspector walked in, said looks great, and walked out! He gave the buyers a report like he went through the entire house! Our last house they did not catch the bad wiring and issues with the heating and cooling system. Supposedly the electric issue should have been caught easily.

We looked into the rural loan here and it seemed it would have even covered towns around us? I thought it was only very country places?
 

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