Buying your first home

[malchior]

BCC me on the email!!! Hell post it here!

I'm waiting on her to provide me some information so I'm on hold but it'll come.

[malchior]

So quick update. I ended up calling the listing agent on the other side myself. I had requested my agent set up a call but she didn't even reach out. There is a better than 50% chance I fixed the deal myself.

The gist of the problem was the seller is an older lady and didn't understand the details of the financing. My agent didn't explain any of the reasons for the details of the offer even though I told her to explicitly explain them. THE WORST. It pains me that this lady is going to get a commission here if it succeeds.

[Octavious]

Holy crap I'm guessing you can at least notify they place she works at how terrible she is. Not sure how much that will help...

[Exodor]

Are real estate agents licensed? Can you complain to some sort of agency?

It's one thing to be slow to respond and quite another to jeapordize deals because of incompetence.



Reading this thread inspired me to look refinancing. I'll get Bank of America off my back and turn my 5.5% fixed into a 3.875% fixed loan. My payment drops by ~$250 a month.

Yay!

[Isgrimnur]

Are real estate agents licensed? Can you complain to some sort of agency?

Real estate brokers have to be certified by the state they do business in. If they are a Realtor, they belong to the National Association of Realtors.

The National Association of Realtors (NAR), whose members are known as Realtors, is North America's largest trade association. It represents over 1.2 million members (as reported November 2008), including NAR's institutes, societies, and councils, involved in all aspects of the residential and commercial real estate industries. NAR also functions as a self-regulatory organization for real estate brokerage.

[Octavious]

Honestly it almost seems like she doesn't think she will make enough money off the deal so she's trying to tank it on purpose. My agent certainly pushed me to find a house at the top of our limit without me really understanding at the time.

[malchior]

Honestly it almost seems like she doesn't think she will make enough money off the deal so she's trying to tank it on purpose. My agent certainly pushed me to find a house at the top of our limit without me really understanding at the time.

My honest belief is it is poor time management. I think she knows the business. I went to open houses and everyone knew who she was. She has a good reputation. My belief is that she simply is too busy to give me good service. She is doing wrong in the sense that she should realize she is too busy and refer us to someone else. From my POV incompetence or simply too busy is all the same to me and I don't have time for it any more.

It also could be a bit of not a big enough cash in the transaction for her at the end of the day but either way I am done with it. If my end around works, cool. If not, my relationship with her was over anyway. I didn't lose any time with a hail mary.

[Carpet_pissr]

Well, after THREE visits to see our house, the family we were hoping would buy has said no due to flow, or lack thereof.

1st visit: Just the wife of the interested family
2nd visit: Wife wanted to show husband, they both came
3rd visit: Couple wanted to show their agent, they also brought kids as well, that romped around and played with stuff, left it out of place, etc

We were hoping to sell it off the market, and save some commission cash, but not gonna happen, and I don't think I have the patience to do a full blown FSBO. Would rather let someone else handle it for me, even though it will cost thousands of dollars.

Ah well...would have been sweet if it had worked, but statistically, probably very unlikely.

Now I am a little concerned because the agent we are going to sign with is under the same agency that is listing the house we want to buy! That can't be good on any level (except for the agency (Re-Max) of course)

[Kelric]

Sat down with an agent today to talk about looking for a home. The area I'm looking in would cost less for mortgage + PMI + taxes + condo fee than what the fiancee and I are going to have to pay to rent a similar sized place in other towns. The downside to looking right now is that I don't really have a lot of money saved up for a down payment plus closing costs plus three months emergency fund.

[Combustible Lemur]

So, has anyone had to sell a money pit?
We sincerely want to get out, but even purely aesthetic covers of damage and corrosion would be thousands. In retrospect, we should not have purchased the house we did regardless, but between 10k in value loss from recession, and another 10k in degradation, and another 10k in hidden damage. we are looking to be screwed. The previous owner was a private contractor who had the tools and experience to hide massive problems even from inspection, and lie about it. We just want what we owe value and to run. We don't even want to buy once were out.

[Zaxxon]

Sat down with an agent today to talk about looking for a home. The area I'm looking in would cost less for mortgage + PMI + taxes + condo fee than what the fiancee and I are going to have to pay to rent a similar sized place in other towns. The downside to looking right now is that I don't really have a lot of money saved up for a down payment plus closing costs plus three months emergency fund.

Not to discourage you, but the formula you need to use is mortgage + PMI + taxes + condo fee + 5%-10% of the cost of the place in annual maintenance/upkeep. For a condo you're probably looking at more like 5% since you generally don't have to maintain the exterior.

[LordMortis]

Sat down with an agent today to talk about looking for a home. The area I'm looking in would cost less for mortgage + PMI + taxes + condo fee than what the fiancee and I are going to have to pay to rent a similar sized place in other towns. The downside to looking right now is that I don't really have a lot of money saved up for a down payment plus closing costs plus three months emergency fund.

Not to discourage you, but the formula you need to use is mortgage + PMI + taxes + condo fee + 5%-10% of the cost of the place in annual maintenance/upkeep. For a condo you're probably looking at more like 5% since you generally don't have to maintain the exterior.

Yepper. Maintenance and time to maintain. Historically (within my not living with parents lifetime), people haven't cared about that because we bought into the idea that your home is an investment that should return you 5% or more a year.

[malchior]

It also could be a bit of not a big enough cash in the transaction for her at the end of the day but either way I am done with it. If my end around works, cool. If not, my relationship with her was over anyway. I didn't lose any time with a hail mary.

Hail mary falls short. Turns out the seller is a bit of a nutter as well. Her PRIMARY concern is how my financing is structured. She doesn't like that I'm doing a 5% down deal. I explained to the listing agent I can do more but it makes sense to me to finance as much as possible at 3.625% than to take money out of my pocket that will earn more elsewhere. I originally thought another offer might have been around the corner but she let it slip that I'm the only offer they've had in over 6 months. I said call me if she comes around but I doubt it since the problem is in my personal finances. I still can't figure out why she would care.

The seller also indicated she was bothered by how she felt about being bullied to sign by a particular time. This was news to me as I didn't ask my agent to put any pressure on. Even though this is just another case of crazy seller it doesn't make me feel any better about my agent. She doesn't communicate, she had zero read on the seller at all and is all about wacky games. Not a good fit at all. We are still meeting with a new agent on Sunday and hopefully get a better result.

[Zaxxon]

Yeah, that's bizarre. Assuming you're financing through a bank and not via some form of seller financing, the seller's interest in the particulars should begin and end with 'do you have an approval from the bank sufficient to cover this purchase'.

[Combustible Lemur]

Also, in my limited experience Realtors are great at getting you to feel time pressure without pressuring you. The longer they spend on you the less time/cost effectiveness their business is. Time is money, and it's their job.

[Smoove_B]

She clearly doesn't want to sell. And it makes zero sense that she's concerned about how you're paying UNLESS you don't have a pre-approved mortgage agreement. In that case she might be rightfully concerned as it's entirely possible the bank might not want to extend you a mortgage for 5% down after you start the review process. At one point it was possible to buy a home without securing pre-approval, but in the year 2012 I can't imagine that's possible when extending an offer to buy a house.

[malchior]

She clearly doesn't want to sell. And it makes zero sense that she's concerned about how you're paying UNLESS you don't have a pre-approved mortgage agreement. In that case she might be rightfully concerned as it's entirely possible the bank might not want to extend you a mortgage for 5% down after you start the review process. At one point it was possible to buy a home without securing pre-approval, but in the year 2012 I can't imagine that's possible when extending an offer to buy a house.

There are multiple factors that scream crazy. She insisted on moving the closing date up. Her husband died in the house (cancer) and she wanted to close prior to the anniversary. I was good with that. But then she took three days to sign the contract which was a signal something weird was going on. I'm guessing that is when my agent applied pressure. Still she did indicate an urgency to sell. It doesn't square up with the reality of it.

On top of that, they called my mortgage banker and interrogated him. He called me about it. I thought it was weird but he promised he didn't divulge any details except that I was well-qualified and had a commitment from the bank already from underwriting (true). I did all my paperwork up front. Obviously an appraisal is still an issue but I have initial underwriting sign off on the loan. Doesn't get much better than that.

[malchior]

This tale has taken a real turn for the crazy. When I last posted, I had found my latest seller was a bit wacky and was meeting with a new realtor on Sunday (today). That went pretty well and I think this one is a completely better fit. She explained a lot of things about the process I wasn't aware of and we talked over communications and basically walked through all the mistakes that happened with the previous offers. She was flabbergasted that I was getting no pricing assistance at all. I had a very good feeling from the meeting.

Now to the old realtor. My wife and I took a trip out of state on Thursday/Friday which I had told her about and I said I would talk to her in a few days about how we would go forward. I came back to find she had attempted to call me several times and then emailed me increasingly angry emails about not getting back to her. Pause for a moment to savor the irony and then move on to this morning where she pretty much demanded that she at least get a referral out of the whole mess. I haven't responded because I was trying to formulate how to respond; the email was completely unprofessional and I really was deciding whether just going to her broker and cutting off communication entirely is the best course or not.

[Kelric]

Sat down with an agent today to talk about looking for a home. The area I'm looking in would cost less for mortgage + PMI + taxes + condo fee than what the fiancee and I are going to have to pay to rent a similar sized place in other towns. The downside to looking right now is that I don't really have a lot of money saved up for a down payment plus closing costs plus three months emergency fund.

Not to discourage you, but the formula you need to use is mortgage + PMI + taxes + condo fee + 5%-10% of the cost of the place in annual maintenance/upkeep. For a condo you're probably looking at more like 5% since you generally don't have to maintain the exterior.

Yepper. Maintenance and time to maintain. Historically (within my not living with parents lifetime), people haven't cared about that because we bought into the idea that your home is an investment that should return you 5% or more a year.

So we went today and saw four places: two we had booked, two open houses.

#1) Really nice interior, the kitchen was all brand new as of 2004 when the place was split into condos. Good storage in the basement and the unit. Back porch, but no yard. Downside was only a 1 bedroom without even an office space to use as a guest room or a baby room. No go, sadly.

#2) Three bedrooms, decent interior but needs a little work. Terrible location and building. No outside space. Nope.

#3) Another fantastic interior, great details. One bedroom, small office space but it is really the entry way and so you can't use it as a bedroom. Front porch all to yourself, shared tiny back yard that is basically enough room for everyone to have grills. The giant screaming red flag is that it is a four unit association divided up 30% for one unit then 23.3% for everyone else. And they need a new boiler and everyone has agreed to pay for it (the seller would cover this expense)... except the 30%er. Nothing can be done without 75% of the vote. If she refuses to pay $3K to replace an ancient boiler, what else will she balk at?

#4) Two bedroom, completely brand new bathroom, I think the kitchen is only a couple of years old. The main realtor wasn't there, had pawned it off at someone else who wasn't up to speed on the details. 3rd floor, each unit has the entire floor. Wood floors throughout, tile in the main kitchen area. Washer/dryer in the basement. We both quite liked this one. One building next door is an apartment building whose balconies are all on the side facing us, but our bathroom would only face brick walls and the bedrooms are on the opposite side of the place from the apartments.

#5) We did not get to see this as the realtor wasn't available. We both love this one from the pictures online and it is one bedroom with an office that we can use as a kid room / guest room. Washer / dryer in the unit, nice big french doors leading to the master bedroom off the living room. The biggest plus: It is $30K cheaper than #4.

#4 and #5 do have a big disadvantage.... #4 is bank owned, #5 is a short sale and has been dropping in price for about six months. Not sure why on the second, but the bank listed it at $143,900 on 10/11 and now it is down to $109,900. The exterior of the building looked nice, so why the hell has it gotten so cheap without the bank getting rid of it?

[RuperT]

This tale has taken a real turn for the crazy. When I last posted, I had found my latest seller was a bit wacky and was meeting with a new realtor on Sunday (today). That went pretty well and I think this one is a completely better fit. She explained a lot of things about the process I wasn't aware of and we talked over communications and basically walked through all the mistakes that happened with the previous offers. She was flabbergasted that I was getting no pricing assistance at all. I had a very good feeling from the meeting.

Now to the old realtor. My wife and I took a trip out of state on Thursday/Friday which I had told her about and I said I would talk to her in a few days about how we would go forward. I came back to find she had attempted to call me several times and then emailed me increasingly angry emails about not getting back to her. Pause for a moment to savor the irony and then move on to this morning where she pretty much demanded that she at least get a referral out of the whole mess. I haven't responded because I was trying to formulate how to respond; the email was completely unprofessional and I really was deciding whether just going to her broker and cutting off communication entirely is the best course or not.

Are you buying a house she showed you?
I have to say, selling my last house and then buying this one just seemed so much simpler the fewer realtors were involved. My buyer had an agent, but my seller did not; I never had one, and only advertised in the city paper IIRC. Then again, I was not a particularly motivated actor, and had no availability problems showing my house. I was also relocating fairly close nearby.

[malchior]

Are you buying a house she showed you?

No, they all fell through. I stopped looking at houses with her to firewall off anything else we would be interested in. She is basically complaining about not getting anything out of any work she did for us. My step-father (who is a realtor) and the new agent both seem to tell me that it is a risk of the business and we don't owe her anything. Until she went berserk on me I was considering a flat payout but everyone seems to think that is a bad idea now.

I have to say, selling my last house and then buying this one just seemed so much simpler the fewer realtors were involved. My buyer had an agent, but my seller did not; I never had one, and only advertised in the city paper IIRC. Then again, I was not a particularly motivated actor, and had no availability problems showing my house. I was also relocating fairly close nearby.

I get different opinions on this. Almost everyone says have one for the buy since it comes out of the seller's commission but an ineffective one does really seem to get in the way.

That said, I have a good feeling about the new agent especially considering the personal connection and multiple very positive reviews from co-workers. My impression was she was all business which is good in my book. The last one was trying too hard to be our friend. As a contrasting example, with the old agent I once had to nod my way through an incredibly awkward conversation about a dog miscarriage while the only non-transactional thing we talked with the new agent about was her connection to my co-worker (she introduced him and his wife). It is a far different dynamic.

[KKBlue]

Our realtor just came over with a co-worker to help with selling this home. She is great and was OK with telling me this was the biggest house she has worked with. We will be going "live" in June, so we all are still working on things, getting it ready to go on the market. As the 3 of us were walking though, the co-worker kept on commenting on how great the house was, so different and unique. At this point I am feeling very, very comfortable with our realtor and how she will be representing us and this house.

It's tough to sell this beautiful house, it really is unlike any other house but we are ready to share it with another family that will keep it up and expand on what we have created the past 10 years. The tricky part is getting the word out there so the right owner will find it sooner than later.

[AWS260]

so different and unique ... it really is unlike any other house

Is this your house?

[KKBlue]

OMG no... it is not.

I don't know if I could live in a house like that. Is that the way it was built? No one in the picture seems to car about the structure or it catching a breeze and continuing to roll.

[KKBlue]

Our realtor just came over with a co-worker to help with selling this home...

When the co-worker went into the basement, he said, "You have to disclose lead. You have lead piping." I was so dazed and confused I didn't question or ask for an explanation, just stared at him. I wanted to say, "That is copper you are looking at." but just stared (deer style) instead.

This morning I looked up some stuff and found

If your home was built before 1930, it is likely to contain lead piping. If it was built before 1988, it is likely to contain copper piping joined by lead-based solder.

That's what we have, the copper piping with maybe lead-based solder. I'll put a call into the furnace company and ask if they added the piping when they replaced the furnace in 2001.
-
Also need to contact a roofer guy cause when the house was power washed the other day, we learned that the flashing needs to be checked out. Not liking all the issues coming up but guess that is what typically happens?

[Smoove_B]

As someone that is lead hazard certified, I've yet to meet someone that is able to actually look at something and say, "That contains lead". Doesn't matter if it's paint, plumbing or vinyl blinds. The only way to find out is to test it. No idea what the laws are in your state, but in NJ it's likely a water test would be performed (depends on public vs. private water supply) as part of the sale. Failing that, a home inspector would flag plumbing that looks suspicious and recommend a water test is performed.

[KKBlue]

Thank you Smoove, your comment helps to keep everything in perspective.
I owe you a drink or to cover your eyes when someone show an octopus

[Kelric]

#5) We did not get to see this as the realtor wasn't available. We both love this one from the pictures online and it is one bedroom with an office that we can use as a kid room / guest room. Washer / dryer in the unit, nice big french doors leading to the master bedroom off the living room. The biggest plus: It is $30K cheaper than #4.

#4 and #5 do have a big disadvantage.... #4 is bank owned, #5 is a short sale and has been dropping in price for about six months. Not sure why on the second, but the bank listed it at $143,900 on 10/11 and now it is down to $109,900. The exterior of the building looked nice, so why the hell has it gotten so cheap without the bank getting rid of it?

#5 had a comparable unit in the same building come on the market this week for $99k. Makes me wonder what is going on in the building / neighborhood, or if it is just coincidence and the people couldn't afford the places they bought at the peak of the market.

Edit - Just got off the phone with a bank for a pre-approval application. Gulp.

[malchior]

As an update, working through Offer 4. We've agreed on a price but this seller is also having a problem with our financing. They didn't flat out walk off but I feel compelled to provide them with a deep look into my finances. My Realtor is licensed in both PA and NJ and PA has a buyer's financial disclosure form. It provides basic information that shows the ability to actually complete the transaction. We decided to fill it out and provide it informally to the seller's agent just to try to smooth things over. Luckily my agent 100% understands my motivation behind doing a 5% deal versus a 10% or 20% conventional so I do feel like she is advocating for me correctly on this. We will see. If this one falls through I'll have to think long and hard about what we do going forward. I don't think I should sacrifice my financial goals to make others feel better about even ATTEMPTING to complete a transaction so our best course of action might be to continue renting.

[Zaxxon]

I don't understand these seller-doesn't-like-my-finances issues you're having at all. The seller should have no concern beyond 'Bank X has given a statement assuring us that they plan to close on the loan'. I've never run into that before.

[malchior]

I don't understand these seller-doesn't-like-my-finances issues you're having at all. The seller should have no concern beyond 'Bank X has given a statement assuring us that they plan to close on the loan'. I've never run into that before.

Two in a row now. It revolves around the appraisal. There isn't any wiggle room at 5% for me to accept a sub-par appraisal by stepping down into a different LTV range. But it is still a stupid argument. No one is going to see a sub-par appraisal and decide to just eat it anyway. My agent said as much to me. More deals fall apart now because of the appraisals than anything else now.

She said she has seen many Sellers seem to think that is the house doesn't appraise that they should still expect to complete the sale at some inflated price. She is quite opinionated and blames it on the listing agent not explaining the market to the sellers. She also said it is becoming more of a problem this year in our area because foreclosures are starting to dribble onto the market. We think there is a risk of it not appraising but not to a catastrophic extent. Probably well under a percent of the house price. It should be manageable but they might not want to deal with it. I also get any trepidation from a psychological point of view. They are literally looking at selling their house for close to what they bought it for in 2002 but that is the market.

[Kelric]

So I got pre-approved at the top of my price range last week. I viewed #5 on Friday night and it mostly held up to my preconception of it. The neighborhood was ok, and you could hear a lot less traffic from the nearby busy street than I expected (and I went during rush hour). I heard more traffic further away from a similar street as a kid than I did at this place. The walk to/from the train station is maybe 15 minutes each way, add two or three minutes if you took the scenic route (which I would most days) that has slightly more traffic and street lights. The fiancee and I walked around the neighborhood at about 10pm Friday and it was completely quiet.

The exterior of the building should probably get updated in the next five years or so, but that is my amateur opinion. The windows are 3 years old, the hot water heaters are a year old, and the flat rubber roof is 8 years old. Self-managed condo association, no expenditures currently planned, still waiting to hear how much is in reserve and to verify equal voting stakes for everyone. Only one unit in the building is rented so that won't be a problem during any mortgage process.

The interior was pretty similar to the pictures but with the shelves gone in some rooms you can see the previous owner didn't bother patching up once he left. We'd either have to hang new shelves in the same spots or patch and repaint the rooms - which sucks, because both the fiancee and I really like the colors in every room. The wood floors will really shine with a new finish, but are acceptable in current condition. The kitchen cabinets and appliances are all in good shape, as are the vanity and toilet in the bathroom, but the tub/shower is something I'd look to replace in the future.

So.... depending on the condo association situation and an inspection, I think we're going to make an offer for it. It is listed at $110k so it is wicked cheap, but there are definitely some things we can do to improve it while there is nothing in the interior that we NEED to do anytime soon. There are much nicer places we can get at $140 to 150k, but talking it over we'd rather have the slightly worse place and save enough money every month to be able to have a car and save a little extra money too.

[$iljanus]

Our Kelric is buying a home? My how time has passed sniff sniff

Good luck! And enjoy the tax benefits of home ownership! (that you can use for home repair!)

[Smoove_B]

Do not underestimate the importance of being able to save money while you're living somewhere. There's always (SEE: always) insane random things that end up happening and if you're just barely making your monthly bills and not developing any type of financial cushion you might end up spiraling into (short or long term) debt rather quick over what amounts to normal home ownership.

[Zaxxon]

Our Kelric is buying a home? My how time has passed sniff sniff

He's all growed-up!

Do not underestimate the importance of being able to save money while you're living somewhere. There's always (SEE: always) insane random things that end up happening and if you're just barely making your monthly bills and not developing any type of financial cushion you might end up spiraling into (short or long term) debt rather quick over what amounts to normal home ownership.

Yeah, definitely wise to be buying below your max-approved price.

[Freezer-TPF-]

Do not underestimate the importance of being able to save money while you're living somewhere. There's always (SEE: always) insane random things that end up happening and if you're just barely making your monthly bills and not developing any type of financial cushion you might end up spiraling into (short or long term) debt rather quick over what amounts to normal home ownership.

Hello, Mr. Condo. Have you met my friend, Mr. Special Assessment?

[Roman]

this whole X% down is baffling.
Why would the seller care what percentage is offered as a desposit? They don't physically get the deposit and get to to on a shopping spree. The deposit is held in trust by the agent/broker. WTF?
Unless things are done differently down there- the funds are not theirs! The deposit simply acts as a gesture of good faith.

Perhaps - the sellers plan to factor in your deposit against their financing for the house to be purchased down the road? Don't think that is legal.. but?

Unbelievable.

[$iljanus]

Our Kelric is buying a home? My how time has passed sniff sniff

He's all growed-up!

Do not underestimate the importance of being able to save money while you're living somewhere. There's always (SEE: always) insane random things that end up happening and if you're just barely making your monthly bills and not developing any type of financial cushion you might end up spiraling into (short or long term) debt rather quick over what amounts to normal home ownership.

Yeah, definitely wise to be buying below your max-approved price.

I remember when we were pre-approved. We both make good salaries and had good credit scores but the amount we were pre-approved for was a little ridiculous. And this was after the bubble burst. We just looked at the figure and thought about how much rope the bank was handing out to hang ourselves if we didn't use careful judgement.

Glad we don't have to do that all again for quite a number of years. But as I was talking to neighbors about home repairs and renovations, it seems that all the houses (neighborhood built in 1947) are hitting a point where things need to be changed. gulp So we may have to do the home equity loan dance in the future.

[malchior]

this whole X% down is baffling.
Why would the seller care what percentage is offered as a desposit? They don't physically get the deposit and get to to on a shopping spree. The deposit is held in trust by the agent/broker. WTF?
Unless things are done differently down there- the funds are not theirs! The deposit simply acts as a gesture of good faith.

Perhaps - the sellers plan to factor in your deposit against their financing for the house to be purchased down the road? Don't think that is legal.. but?

Unbelievable.

I think it is more around the ability to complete the transaction which is fair but IMO they are factoring everything wrong. I provided them detailed financial information and that seemed to settle them down. Now they want to move into August which is great for me cash flow-wise. We may be getting somewhere yet. They are dragging their feet a little on signing because I'm sure they are hoping someone else comes in but this is a pretty odd market still. They are claiming a lot of interest which is plausible considering it is in a desirable neighborhood but there are 4 houses within a couple of hundred feet of each other for sale right now that have been on the market for months each including the second one I put an offer on. I like my chances of not having another buyer come in. My concerns currently center about the seller's deciding not to move their kids after all and the appraisal.

[Roman]

go with new construction purchase. no worries about offers etc