Advice on Buying a House

My husband and I have bought the book, "Buying a House for Dummies." we've saved the down payment, have zero debt, and we have an appointment Friday to get a loan pre-approval from our bank. Neither of us have ever bought/owned a house.

If you have bought a house, could you please tell me if anything happened in this process that made you think, "I didn't know about that!" or "I never thought that would happen!" or "I wish I would have done it differently" etc., you get the idea! Thank you for your experiences.

Cheers, from
SwampWitch

I am in the process of buying my first house. Make sure that you have a realtor representing YOUR interests. I am lucky to have a close friend, who is a real estate agent and he won't allow me to get messed over.

Find a good realtor...a good realtor is someone who listens to you and what you are saying, your wants/needs/desire.

You are going to want to do an inspection (structure, termite) and look for any cracks or stains etc.

Your realtor should point out stuff, that's what mine did. We didn't end up buying but we went looking and she was great, listened to what I wanted and found houses to meet those desires and needs. She prepared comparisons, told me if she thought it wasn't priced right, she told me the concerns she had, the pros and cons of each house. I mean, she was really really thorough and that's what you need to find.

Here are some things you can read:

http://finance.realtor.com/HomeFinan...or&poe=realtor

My mom was a realtor for years. You've got a great start... espically being debt free. Between that and the saved DP you should get a pretty significant loan depending on your annual income.

Having a realator is good but it's hard to pick a good realator. Do you know anyone who is a relator? Or do you know anyone in you area who's bought a home recently and could give you a recomendation? Also, if you pick an agent and then find you don't like them for what ever reason walk away and find someone else. It sounds crappy and it sucks for the agent being dumped but for your own interest it's the best thing you can do.

Also if the sellers aren't willing to have inspections find a different house. I'd never buy a house that didn't pass inspection! Buying a home (new or used) will always mean you'll encounter some problem w/ the home itself but inspections keep these to a minimum.

Yes - you need to have the house inspected - however please look for an reputable inspector that does not have any ties to your realtor, you want an independent that works for you and only you!!!

The biggest thing I found is that the banks/mortgage brokers are willing and wanting to get you in more house than you can afford, realistically. Do your own calcs, know what you can pay for PITI (Principal, Interest, Tax, Insurance) as a lump sum, and don't get talked into more house than you can afford.

INSIST on a traditional 30-year, fixed interest loan. The ARMs, Interest Onlys, etc. are legal scams, IMO. And if you need to get into a 50 year loan, it's too much house for you.

Are you meeting with someone at a bank or a mortgage broker? We went through a bank (Wells Fargo) that has a great first time buyer's program. For the cost of one Saturday afternoon for a class, they got us a fabulous interest rate and no mortgage insurance (also a scam, IMO. Find a way to avoid having to get mortgage insurance!)

The biggest thing is really just to know what you want, what you can afford, and be willing to walk away from anyone that tries to push you into something more. You are not obligated to stay with a realtor if they aren't acting in your interest. Do your own research into what is available on the market, what's available in your price range and in the area you like. Do your own research on first time buyers programs and what kind of interest rates are being offered. Be informed, be confident, and don't let anyone take advantage of you.

Oh yes, and be sure to have FUN! You will only buy your first home once. We just purchased our first home in July.

Originally Posted by Rosey

Find a good realtor...a good realtor is someone who listens to you and what you are saying, your wants/needs/desire.

You are going to want to do an inspection (structure, termite) and look for any cracks or stains etc.

Your realtor should point out stuff, that's what mine did. We didn't end up buying but we went looking and she was great, listened to what I wanted and found houses to meet those desires and needs. She prepared comparisons, told me if she thought it wasn't priced right, she told me the concerns she had, the pros and cons of each house. I mean, she was really really thorough and that's what you need to find.

Here are some things you can read:

http://finance.realtor.com/HomeFinan...or&poe=realtor

Click to expand...

Totally right about having the house inspected.
Its the best thing you can do.
Before you even decided to hire and inspector do some investigation work yourself.
when doing a walk through....Look in the basment...check out the piping, the foundation..look for signs of water damage and flood also look for signs of dodgey electrical work. If you know anyone in home construction bring them along. Think about floors..do you want a ranch or a bi level home..if you have two floors and one upper bathroom and one lower bathroom..think about the piping and all the what-ifs that could happen with that....

Look at what the yearly taxes are..and school districts. those can be very important. Are there trees close to power lines(my grandparents have had to hire people to cut down plenty of trees in their day) and how great is the roof. The last thing you wanna do is buy a house and the first year your in it the roof goes.

those are just a few things Dan and I look for right away.
We have looked around but are still in the process of cleaning up our credit and saving...the more we look the more we know what we want.

Good luck! buying a new home will be very exciting!

Originally Posted by valanhb

The biggest thing I found is that the banks/mortgage brokers are willing and wanting to get you in more house than you can afford, realistically. Do your own calcs, know what you can pay for PITI (Principal, Interest, Tax, Insurance) as a lump sum, and don't get talked into more house than you can afford.

INSIST on a traditional 30-year, fixed interest loan. The ARMs, Interest Onlys, etc. are legal scams, IMO. And if you need to get into a 50 year loan, it's too much house for you.

Are you meeting with someone at a bank or a mortgage broker? We went through a bank (Wells Fargo) that has a great first time buyer's program. For the cost of one Saturday afternoon for a class, they got us a fabulous interest rate and no mortgage insurance (also a scam, IMO. Find a way to avoid having to get mortgage insurance!)

The biggest thing is really just to know what you want, what you can afford, and be willing to walk away from anyone that tries to push you into something more. You are not obligated to stay with a realtor if they aren't acting in your interest. Do your own research into what is available on the market, what's available in your price range and in the area you like. Do your own research on first time buyers programs and what kind of interest rates are being offered. Be informed, be confident, and don't let anyone take advantage of you.

Oh yes, and be sure to have FUN! You will only buy your first home once.

We just purchased our first home in July.

Click to expand...

Heidi is really right on making sure you can comfortably afford your mortgage. Home ownership is great in that you can do what you want to the house but you are also responsible to fixing everything also.

Homeowner's Associations (HOA) are appearing almost everywhere so make sure you understand their agreements and contracts. You need to feel comfortable with what they want because it can cause you a lot of grief if you are battling them. See if you can talk to the boards or the architect committees to get a feel how they work.

Good luck and I hope we will be holding a housewarming post for your very soon.

Before you even figure out what kind of house you can afford, know what kind of utilities and taxes you can afford.

Lets say you want to buy a house that is twice the size of your apartment (just for an easy number)

then...

Take your electric bill, double it, add 10%
Take your water bill, double it, add 10%
etc...

Remember that your mortgage payment isn't just your mortgage payment.

If you put down less than 20% for a down payment, your bank will charge PMI. This can easily add another hundred dollars or more to your monthly mortgage payment. Your bank will also want to escrow your taxes and homeowners insurance. These items alone can turn a $1000 mortgage & interest only payment (which is what mortgage calculators calculate) to a $1500 or more payment in the blink of an eye... and unfortunately, I've witnessed quite a few people think they can afford a house, find out the monthly payment with all the goodies added in and then realize they have to buy a smaller house. Leave yourself a buffer.

Make sure you go with a reputable title company. I've been in the business long enough to know there are some shady characters out there. Get recommendations.

Check rates at more than one bank. If a bank services their own loans they will have higher interest rates than a bank that doesn't service their own loans. Whether they service it or not will really not make a difference to you. If the bank does service their own loans, you will make payments to them for the life of the loan (or until you refinance with another bank). If they don't this means the bank will sell your loan to another, usually bigger, bank and you will make payments to them. The difference really is who you write your check out to every month.... and even banks who service their loans sometimes sell them anyway. Lately I've seen the difference in interest be along the lines of .5% or more.

When you call to find an inspector, find one that is willing to teach you as he/she checks out the house. You don't want to get handed a report that says " ___ is broken" and you're thinking ":censor::censor::censor: is ___ ???" Not all are willing to do this. The good ones are.

(This may be a local thing, but...) If the house has a septic or aeration sewage system, find out what the bill is for the yearly maintenance. Usually the owners have a deal with a company and pays them something like 200 or 300 per year and the septic people come out twice a year to check it. See if your county requires a license for your septic system... which can also run a few hundred dollars payable yearly.

Find out if there is a seperate fee for garbage pickup or if it is 100% included in the taxes. (Only a portion of mine is included in my taxes and then I get billed for the balance.)

Ask if there is a termite bond on the house. If they had one and let it lapse, have them renew it.

Around here, expect your closing costs to be around $5k. Expect your survey to be about $300. Expect your home inspection to be about $300.

If the house has fuel tanks, ask how much it costs to fill them each year.

I can't stress this enough.... find out how old the roof is! This is a HUGE expense if you have to replace it and if it is snowing when the inspector comes, he may not be able to get on the roof to fully check it. The newer, the better!