Hello all! Today I wanted to try something a little different. We have a guest blogger! If you have been thinking of buying your first home, but have no idea what to do, read this!
Welcome my guest writer today, Erin Morrison:
From the mouth of one first time home buyer to the ears of another first time home buyer: the good, the bad, and the ugly!
It’s hard to weed out all that you hear from Realtors, banks, lenders, elders, and renters about buying a house for the first time. “Don’t do it, you’ll regret it! Now’s the best time to buy! Buying a place is a huge responsibility.” Those were all things that I heard when I decided to start looking. And at the time that I did start looking, I hadn’t made up my mind for sure if I was going to buy a place or not. So I called Andra and told her sketchy details of what I was looking for. She sent me over some places that she had found in areas that I was looking at and off we went! From start to finish, I probably looked at 50 different places. Some great, some not so great. But that’s the reason to look…to weed out the crap and sift out the gold. And I thought I found gold. Three times. I looked at about 20 houses before I found the first place I put an offer on near Percy Priest Lake. It was great! I was nervous, scared, excited, terrified, and exhausted. I thought I had found the perfect place, nice little yard, just enough room for me and a dog. Everything was contingent on the home inspection. So, after that was set up I was to meet Sonny at my potential new place just as he was finishing up. Turns out there was water damage on the first floor that meant ½ of the downstairs sub floor needed to be ripped out and replaced. After the owner said they were not inclined to fix anything, I was able to get out of that deal. The second house I found the very next time I searched again. Once again, made an offer, got a home inspection and went to meet my home inspector (Sonny, that did the first one) to find out this house was worse off than the first one. Fire damage in the attic. The entire roof needed to be replaced, in addition to some electrical safety hazards. I signed my release from the offer for a second time. At this point I was exhausted from looking, didn’t ever think I’d find a place, and was not happy about going out to search again. But with some prodding, I gave in. After another 20 houses or so, I found my current residence. Bixler Farms. Absolutely perfect! A brand new condo complex with exactly what I had been looking for. I have now been in my house 2 weeks, and smile every time I walk up to my door, wake up in the morning, and realize how lucky I am to be where I am!
Advice and words of wisdom that I’ve learned: from me (first time homebuyer) to you (first time homebuyer):
1. Find a Realtor you like! Even if you are not sure about buying a house, where you want to live, the amenities and all the dressings, you need to have a Realtor that cares about YOU. The best kind are the ones that will listen to what you have to say, are patient and willing to look at HUNDREDS of houses if need be, and will still offer insightful advice. Andra is not only a personal friend, but an incredible person to have when dealing with the real estate business. She gets 2-thumbs up in my book!
2. Get preapproved by a lender before starting into a full-fledged house hunt. There’s no point wasting your time looking at something you can’t afford. Your Realtor should have someone they use regularly and can recommend. You can use whom you like, but I found it easier to use who my realtor knew. (Taylor Hill from Gateway Lending….my little namedropping!) The lender will be able to tell you what loan/s you are approved for, the stipulations on those loans (interest rates, down payments, etc.) and give you an estimate of your mortgage payments per month.
3. Go shopping! Find a place that you can picture yourself in. DON’T FORCE IT! If you need to see 100 places, so be it. It took me close to 50 houses to find the one that I am in now. Be patient!
4. Make an offer! Once you find a place that suits you, don’t hesitate to make a move. The longer you wait, the higher the possibility that another offer might come along.
5. Depending on your price range, that will determine the amount of money needed for an earnest deposit (the money you put down with your offer to guarantee you want that property). Personally, I put down $500 (for having a price range up to $115,000). As a side note: the money you put down for an earnest deposit will go directly into your closing costs…so you don’t lose it, it benefits you in the end.
6. Once you have made the offer, don’t bug your realtor! They are looking out for your best interest and will notify you as soon as they hear back about your offer. This advice also applies when going house hunting. If there are places that you’ve found and have been interested in, send an email to your Realtor notifying them that you are interested in those properties and they will be more than happy to look them up on MLS or call to set up a showing. I hate to say it, but no one likes to be called 6 times in an hour when you have not heard anything from the sellers. Patience is a virtue!
7. Don’t get emotionally attached to the house. It is a material possession and should be treated like one. Something may happen where you don’t get the place (I’m a perfect example of that).
8. Be wary of remodeled homes. There is a loophole in the system that denotes that an investor does not need to disclose any information if they have not LIVED in that house for 3 years. Example: An investor buys a property and in 6 months has put it on the market as a flipped house. They have never lived in it, but knew there was a fire in the attic and that the roof would need to be replaced. They do not have to disclose this information at the time of the offer. If this does happen, your home inspector should find it. Should being the key word. Because of my situation, I highly recommend Sonny Reneau from Hampton Court Inspections. I got a great deal and he was very thorough.
9. Shell out the dough for a good home inspector. It is worth your time and money to know exactly what is wrong with your house. You don’t want any “surprises” after you move in.
10. Go with the loan that is the best deal for you. I got a 100% THDA loan with an interest rate of 5.45%. This means I didn’t have to put ANY money down besides my earnest deposit ($500), my home inspection ($250), and what I brought to closing ($385). This differs for some people depending on the price of the house, the loan type and how much your closing costs are, but it is possible to buy a house and spend as little as possible! (Total = $1135)
11. If the owner is making repairs that you have requested, do a final walk-through before your closing date to ensure that everything was fixed and were fixed correctly.
12. Close on your house! You’ve waited all this time so just do it already! And once you get those keys, GO TO YOUR HOUSE AND MAKE SURE THEY WORK!!! When I put my key into the lock for the first time, it didn’t work. The seller’s Realtor got them messed up, so be sure you check to make sure every key works in every place it is supposed to work.
Last but not least, have a huge party! All your friends and family can come enjoy your new place, buy you some things for your house, and be jealous that it wasn’t them that made the smart decision to buy! (and be sure to invite your Realtor…after all, they were the one holding your hand through the process!)