(no subject)

[kittydesade]

1. Bist du auch mit gegangen? Ja, trotz das Wetter.
2. Warum ist dein Bruder zu Hause geblieben? Wegen seins Arbeits.
3. Ist deine Schwester mitgegangen? Ja, statt meins Bruders.
4. Sind viele Leute gekommen? Nein, wegen des Wetters.
5. Wann macht ihr Pläe fü die nächste Wanderung? Währen dieses Woches.
6. Warum gehen die Leute eigentlich wandern? Wegen des Cafes.

.. I think.


Well, that was a thoroughly disheartening conversation with my mother in which she decided that telling me my monthly payments would be twice and a bit what I expected/what we could afford, and then spent the next twenty minutes or so attempting to take it back, tell me I'd get plenty of help from the family (which is probably true) and that there were plenty of affordable homes in the area (that might, for all I know, be trailers or fixer-uppers) and generally be of no help whatsoever. Oh mother. I love you, for most things you are helpful and reassuring, for this? Apparently not so much. I now feel even worse about buying a house than I did, even poorer than I did, and am terrified of going anywhere near the goddamn credit bureaus, let alone a loan application.

The questions I did want to ask, folks on my flist! You who have bought homes, tell me! My current impression is that it is easier to get pre-approved on a loan once you have an idea of what you want to aim for, spending wise, and then go house shopping for that range. Yes/no/where did you get that idea you crazy woman? What does getting pre-approved for a loan even look like? What kind of paperwork is involved, I mean, do they punch in numbers on a computer and then it spits out your suitability for whatever, and then they give you some paperwork to sign and you show that to the realtor/real estate agent/people with houses who ask? What ducks do you want to have in a row before you look at houses? What does making an offer look like, do you just say something or is there a written part too? I know the definition of escrow but the practicalities bemuse me. Enlighten me, o mighty internets!

Or, you know, don't. I'll be over here still cowering from my mother's "oh, *$500 over your month's wages* is about what I'm paying for that much house."

Seriously, there are two parts of my brain very much at war right now. One of them is running in circles panicking, tears flowing down her face, trying to stick her head in the oven because she's dirt poor and never going to be able to afford anything ever and what's the point of living??? And the other one is pondering dinner recipes and making lists of the rest of the shit she has to get done tonight, like Japanese and writing and reviewing for the Music Theory test. It's very weird in here right now.

This was going to be about more than just house buying, I swear, but I think I'm out of cope for anything more serious, so you get house buying panic. Sorry. Kind of.

Comments

[synecdochic]

It basically depends. When you go for pre-approval, the bank will generally want to know how much you're looking to borrow, and they'll run your credit report and see if you fit their profile for being willing to underwrite the loan. They will generally write a letter saying you are pre-approved to borrow up to the amount you asked for, which is all you need to show to the seller when you make the offer; if you get a good rep/ask the rep nicely (and, sometimes, have decent enough credit that they really want you (when we bought this house we had mortgage companies fighting over us and you don't want to know how sick our mortgage rate is) but often they'll do it for anybody), they will also write you letters for $10k and $20k less to use for negotiations. (IE, you don't want to show the seller that you're preapproved to borrow up to $375k if you're making an offer at $310k with 20% down and asking for the seller to pay closing costs, etc.)

The old rule of thumb was, to close you need around as much in cash as you're putting down on the loan, especially if you are taking points. This is usually not true anymore -- the housing market is shit enough in most places now that you can usually get the seller to pay closing costs, especially if the house has been on the market for six months or more. But do plan for at least $10k in closing costs. The rule of thumb that will never go away is that you should plan for at least 3-5% of the purchase price of the house in necessary repairs in the first year of ownership. (This is adjustable based on what the pre-sale home inspection looks like, but again, it's good to plan for at least $10k in major repairs over the first year.)

Just because you can get preapproved to borrow $X does not mean that you should buy a house that costs $X minus your available down payment. Rule of thumb: your monthly mortgage payment (principal + interest + escrow) should be around 30% of your monthly income. If you can swing it, you really want to put 20% down; it will keep you from having to pay private mortgage insurance monthly, which will be up to around $100 more per month. (We could not quite swing 20%, but that was just because we needed to hold back some money for immediate repairs; the place we bought needed a little work.)

To make an offer, you let your realtor know you want to offer on the house, and they'll put together all the paperwork. It is a lot of signing. (A lot of signing.) The seller may accept, or may counteroffer. (For instance, when we bought this house, we offered at listing price minus $30k and asked for them to pay $8k in closing costs. They countered with listing price minus $30k and $5k in closing costs. Sold! And I am going to rub my wife's nose in it for years, because I wanted to offer list minus $45k and get talked up, heh. There were a ton of extenuating circumstances, though, and such a lowball offer is not necessarily the best thing to do.)

You don't need to have anything before you start looking, really. We house-shopped for about five years, on and off, before we found this one. Some realtors will be pissy about clients who don't want to buy immediately, but we were working with a coworker of Sarah's who does it as a side job as a favor for her aunt who owns a realtor's agency, so she didn't have a lot of "must sell now!" pressure; she was willing to just take us around whenever we saw something we liked. We did all our own research and looking, with the help of Redfin and ZipRealty. (ZipRealty has better search; Redfin has more exposure of MLS data.) If nothing else, start watching realty sites regularly for your area and start to get a feel for how the market is in your area. (We held off on buying because a) we hadn't found the perfect house until this one, b) we were having a Difference of Opinion about how turnkey we wanted the place to be -- she placed the totally unreasonable restriction that any house we bought had to have a working kitchen and a working bathroom at the time of purchase, which I felt was completely cramping my style, but then again, I was raised by a general contractor and think nothing of the phrase "eh, who cares if it's load-bearing, that wall can come out no problem" -- and c) I was convinced that the market had not yet bottomed, even though it was hovering near the bottom, and that interest rates would keep dropping. Sure enough, when we did buy, we locked in at the lowest interest rate our area had seen in the last 36 months, and it's been going up since.)

Fixer-uppers are not necessarily as bad an idea as you might think, especially if you're at all handy (or willing to learn), but definitely get a home inspection done by an ASHI-certified inspector (anyone can call themselves an inspector, but ASHI certification is crazy detailed), ideally one that's using home inspection as a secondary career after having a primary career in the building trades -- they'll be able to point out what's "fixer-upper" and what's "The Money Pit waiting to happen". If you get to that point, I will let you know all kinds of things about how to pick a good inspector and what to look for. (I can also give you the rundown on what to make you run away very fast from a property before even getting to the home inspection/making an offer phase of things, if I get the energy, but my tales of the Death Trap House and other fun things in my real estate roulette tag will help you figure out some of the things to look for.)

Feel free to ask more!

[kittydesade]

You are a sanity saver.

Okay, having read, then re-read and taken various notes (in about three different colors of ink, I think my head is done exploding. The advantage, I suppose, to having grown up here and having multiple family members in the area, small town, blah blah, is that at least the neighborhoods, crime rates, and weather patterns (such as my aunt's continually lightly flooding basement!) are familiar. We've been mostly window/picture shopping for about two years, but this is the first we've taken semi-serious steps.

The boyfiend is making irritable noises about fixer-uppers. Which makes me chuckle, but I can't really blame him. I will, however, be grateful for all the aunts and uncles who built the farmhouse largely from the foundation up when they moved down here, and not hesitate to call on them if it turns out we need fixing. Not afraid to learn how to do the work! ASHI inspector, check, I will probably come clinging to you ... pretty soon, with that, I think. If this goes as fast as I think it might we'll end up looking at a few houses before the holidays, a few after, and commit the terrible terrible act of moving in winter in the mountains. Thank god for the moderate weather field.

... The boy also points out that he's eligible for a VA mortgage, which I don't know if any of our local banks offer, but, hmm.

Having a good idea of the money, percentage and figures wise, is a godsend, thank you. I know... mmph. I know that at the end of the year my ever benevolent and awesome grandfather is going to do more of the pre-inheritance inheritance stuff, which amounts to about the limit of what you can give tax-free to one person/family member? in a year. I also know that we have at least three? I think, family members on my side and one on his who are willing to help kick in $New York, $Texas, and $Russia at least on my side. This doesn't, as my mother found out, help keep me from outright panicking about being able to afford it, but now at least I can crunch numbers and figure out what part of $(New York + Texas + Russia) I need to budget for related expenses, etc. I know I probably will be coming out of this year with close to or zero debt of any kind, so there's that at least.

And at this point I think I'm just using you for a scratch pad, so I will go find the actual scratch pad now but thank you. This helps. So much.

[synecdochic]

I'm happy to be a scratch pad! We did things slowly and patiently so that we could do them correctly, and we're not likely to be moving again for at least another ten, fifteen years, so I'm happy to pass on the knowledge so someone else can get some use out of it *G*

"Fixer-upper" is a relative term. I mean, the house we bought hadn't been touched except for basic maintenance and minor cosmetic updates once the former owner died and his kids inherited it, and the former owner had lived in it since '65. They kept up the maintenance, and the roof was new since the father's death, but there were a lot of little things (actually, if you email me -- synecdochic@dreamwidth.org will get to me -- I'll email you the copy of the home inspection, so you can see what's 'normal' for a well-maintained house that's about 60 years old to have on its inspection results and still be considered 'in great shape', and I'll also send you the inspection for the house we made an offer on and backed out after the inspection results because of serious issues, to compare).

Like, the first thing we did was replace half the pipes in the house because they were galvanized steel that had all corroded, and we're replacing the other half slowly over time; we had to rewire every outlet in the house and install a few GFCI breakers, which my dad taught us how to do ourselves to save electrician's fees and now we can pretty much handle any electrical issue that might crop up; we had to replace the gutters; we had to recaulk the bathroom (twice); we had to divert some of the downspouts -- stuff like that. All of it was incredibly minor stuff. You just have to remember to think of it as, there will always be something, so just make sure it's minor. (Like, we're going to have to replace all the windows sometime in the next five years or so, and I really want to run another electrical feed from the mains so we can get some more amperage into the house so we stop blowing circuits, and I want to convert the kitchen stove to gas, yadda. None of that's necessary, but it will be nice.)

If you don't already watch it, pick up a few seasons of Mike Holmes' show Holmes on Homes, ideally the first two, three seasons when he was doing minor jobs and before he went over the top with major projects, or his new show Holmes Inspection. He plays to the camera a lot, and he really does go over and above the call of duty, but he will teach you an amazing amount about what warning signs to look for when you're looking. (We toured about two dozen houses before picking this one, and I'd say about 80% of them got knocked off the list because of warning signs that I could notice without even looking too closely, not because the house itself didn't suit our tastes. In my case, I learned what to look for from my daddy, but Mike Holmes taught Sarah! Or rather, taught her to believe me when I said "this is not a big deal" vs "okay, this is going to be an issue".)

If you and the boy are not married, btw -- I can't remember if you are or not -- make absolutely sure to check your state's real estate law. Maryland, for instance, makes you jump through a bunch of hoops in order for the deed to be "joint tenancy with right of survivorship" (which is what you want) rather than "tenants in common" (which you don't want) -- check to make sure your state doesn't do the same.

Also check with your state to see what kind of property records are online. MD, for instance, has a ton of information online that you can use, to look up previous transfers, tax records, mortgage history, yadda, and we got a lot of use out of it when shopping around: a transfer anytime between 2005 and 2008 to someone who did not use the property as their primary residence is a warning sign that the house may have been flipped, especially if it was only held for a few months to a year or if the mortgage was an ARM. (Do not buy a house that has been flipped. Period. There were some good and ethical flippers working, even during the height of the boom between '05 and '08, but they were few and far between and you are just asking for a world of trouble. See also: death trap house. I actually helped get the death trap house condemned by the county; it was that bad.)

It also let us figure out who was trying to earn back a ridiculously high purchase price and who had been in the house for long enough/bought the house low enough that we had some room to dick around in negotiations. This is part of what let us make such a low offer: we looked it up and could see that the house transfered hands in '08 for $0 (which almost always means inherited or transfered inter familia) and previously was sold in '65 for $35k. That told us that the seller wasn't underwater, wasn't looking to recoup a large purchase price, and wasn't looking to dump the house before the ARM reset -- all of which can lead to being stubborn on what they'd accept. That plus the house being on the market for 600+ days gave us a lot of confidence that the sellers would be willing to dicker with us, and both parties walked away from the sale feeling like we'd gotten the better of it: they because they got a large fraction of the price they wanted and they got to stop paying maintenance and upkeep on the property (the two sons who owned it were both in their 60s, and from out-of-state; they just wanted the thing to go away so they could start coming to terms with their father's death and the sale of their childhood home) and us because we got a good, solid house for under the assessed value in a great neighborhood.

The reason it had been on the market for 600+ days despite being so good underneath, meanwhile, was twofold: one, it's on a very busy street (big deal, we don't have kids and that just leads to us having the best gourmet market in the world right next door) and two, the kitchen and bathrooms were cosmetically awful. Just, seriously, hideous. And a ridiculous number of sellers are incapable of looking past the cosmetics.

If I had to give you one bit of advice while looking, actually, that would be it: never fucking care about what something looks like. (Care about the architectural flowthrough of the house, like, "is this room big enough" and "is this traffic pattern going to drive me nuts", but not the paint or the finish.) You can paint, wallpaper, refinish, and rearrange just about anything. (Obviously it will cost more to do certain upgrades -- we are planning on gutting the kitchen and bathroom both down to studs in a few years when we can afford it -- but there's always minor stuff you can do to make due in the meantime.) The only dealbreakers should be architectural or structural issues, not cosmetic: you can live with ugly, but you shouldn't accept poor quality. It is astonishing how many people will bypass a solid quality home of good construction but ugly cosmetics for a piece of shit with all the latest luxury touches.

On househunting shows I have seen multiple people refuse to buy a house because they don't like the paint or the wallpaper. This is the fastest way to make me start screaming at the screen. (We got the wallpaper down in the kitchen before we even moved in. We haven't repainted/refinished the walls yet and it still turned the kitchen from "screamingly hideous" to simply "ugh". And removing wallpaper is actually really fun.)

Feel free to pick my brain anytime you want. I don't mind being the scratch pad!

[kittydesade]

This is awesome and wonderful and exactly the kind of help I was looking for.

Actually, while he was making faces I was pondering what kinds of things I, personally, would be comfortable with... caulking, definitely. Electrical and plumbing, not at all, but after some nudging he seems to be comfortable with replacing piping and water fixtures, so that makes one of us, and I can take directions. I can also wield a saw, screwdriver, and nailgun with equanimity as long as someone's telling me where to point it all. Insulation I'd be comfortable with, probably even replacing windows; my biggest problem is I've never done any of this before, so I'd want to drag someone out to help me.

Holmes on Homes, check. I've never seen it, but it looks like it's available on the internet! And that can be while relaxing and knitting, too, so that's good...

Mmm, looking up records and also how to look at them, not something I would have thought of! More notes, go go hypergraphia working for me. I know there's at least one property in the area that Uncle Elf Lord's been thinking was owned by an elderly couple now either deceased or in a nursing home and the kids don't know what to do with it, but it's so overgrown in the front I can't get a decent look. Possibly next week, then, I'll get a list of the properties whose listings I'm half looking at and he and I and maybe the boy can check records on those.

Ppffff, cosmetics schmosmetics. Actually, when I went through an open house that was going on when I first moved down here to live a few years back, that was one thing about the house that drove me nuts. The architecture of the bottom floor was nice, open, great space, but I don't think they could have made worse use of the upper floor space if they'd tried. Everything was sort of jammed together at awkward angles and I'm pretty sure doors would open and catch each other if you weren't careful. Plus they'd built the house right up against the root system of a giant old oak, I think it is/was, with the porch wall being about a foot and a half away from the trunk. I'm still waiting for a stiff breeze or a good snow to tip what's left of that tree over. No, cosmetics are something I'm budgeting for along with more furniture; new wallpaper, new paint, an area rug or maybe new linoleum or something, that I'm not at all worried about. I'm actually not even thinking much about it till I see what I have to work with, then there will be nesting. If this hadn't all been a perfect storm of snowballing I would take a year and make me a hope chest of linens and curtains and suchlike. As it is, I'm totally counting adjusting the cosmetics as my nesting procedure.

Oof, anyway. The real estate laws! No, we are not legally married, yes, that is a very good point, thank you that is so not something I would have thought of on my own. I know NC doesn't have common law marriage laws, but, mm, actually since not legally marrying seems to be a family tradition in my family, I can ask the aunt about that tomorrow, she and Uncle Elf Lord have drawn up all kinds of legal paperwork so that they take care of each other that way.

And, there, I think the manic bounceback is dying down judging by the waning need to write down endlessly repeated lists, which means I might actually get some sleep tonight. But, again and often, thank you. This is so, so much help.

[synecdochic]

Yay, it makes me happy that I can be useful!

Holmes on Homes is a great show. In the later seasons (there were 7 of them before he moved on to Holmes Inspection) he got a little ridiculous sometimes in terms of how far over-and-above he went to fix problems and with the size of the jobs he'd take on, but he's very, very good at explaining to the camera what precisely is wrong with something, even if he does grandstand a little. (His catchphrase is, "Take it all down!" As in, "I'm not even going to try to patch this up. Rip it out and start over.")

I checked, and NC does assume tenancy-in-common without explicit statements in the deed to the contrary. That's something your realtor would probably catch for you, but it's good to have it on your list as something to explicitly ask about. There's a few minor quirks, but on the whole, as long as the deed is written to declare joint tenants with right of survivorship at the time of transfer (and not changed over later) you should be good. (The deed should be explict: "joint tenants with right of survivorship" and not "joint tenants".)

Electrical and plumbing are the two things you always want to get somebody who knows what they're doing in on, anyway -- I will DIY many things, up to and including removing walls, but electric and plumbing I will hire someone to do. (Or make my dad do, but he did it for 20 years and was not just a general contractor but also held limited plumbing and electric licenses, so.)

North Carolina appears to have land records online, at least for some counties; it doesn't appear to be a statewide system, but you can kick a lot of useful information out of just basic land and transfer records. Some counties appear to also have deed images and tax records online. Even if they aren't available online, it's worth going to the county clerk and pulling those records in person if you can't get them online. You can learn a lot of information that way.

If you go to Maryland Real Property Search, pick Carroll County, pick Street Address, and put in the address of the property we didn't buy (it's on the inspection document that I sent you in email) you'll see the example of what we had available to us when we were investigating (I'd show you the one for the house we bought, except the county has fucked up the way the property is recorded -- it's not listed under N Something St, it's listed under Something Street Ave North or something, and although we figured out how to get the information out of it the first time, I've totally forgotten the trick). Poor bastards still haven't sold it, even nearly two years later.

[kittydesade]

You are incredibly useful. You are a life- and sanity-saver. ... Holmes sounds like my costume shop boss. That's kind of hilarious.

Ah-hah... Into the notes it goes, yeah, I doubt either of us would have thought of that. Good to know, for the "God forbid in case anything happens" contingency. Which is a whole other list of things to do, I suppose, while we're taking care of things. January is going to be a very legal/bank/etc visit heavy month.

Hey, North Carolina government working for me for a change! And it looks as though my county, hopefully the county I'll be staying in, has some of the more extensive records available, ooh, I like that. Hm, not this coming weekend, which is getting crammed enough with organizational crap, but next weekend, that can be for going and combing through things. Possibly the weekend after and now I do need to start putting all of this on my calendar, cross-referencing with all the other crap I'm doing which is probably in my check in post.... blather.

Looking at those reports I can, um, see why they haven't sold it. O.o Wow.

Information! Tasty tasty information. We likes it, precious.

[synecdochic]

*g* Yeah. I feel really bad for them that they haven't sold it yet, it was a messy divorce and they both wanted to just move on, but they need to make about $40k in repairs to the house before anyone will buy it or discount the house sharply and sell it as-is ... once they can offer clear title. Which is going to probably involve groveling to the county, since they already had one round of "forgive us for the unpermitted work".

[lireavue]

*pops into thread* Just to say THANK YOU. I am queen of logistics and keeping Jag's sanity intact, but I have zero experience here, which makes the whole logistics aspect much trickier. Now I can focus on thwapping her to enact coping mechanisms for the flail! XD

(And then I can memory this post and probably subsequent ones on the househunting experience, because this is already a treasure trove of useful-in-five-years-or-so information.)

[synecdochic]

Happy to be of service!

[kikibug13]

Oh, good, I am glad somebody chimed in with practical info for over there. The system is so different here!

Anyway. *huggles you tight* It's damn scary. It's also damn right NOT impossible.

[kittydesade]

Syn is a lifesaver. This is EXACTLY the kind of information I was looking/hoping for. Demystifying everything and making it a lot more doable. :)

[kikibug13]

\o/ Every great journey, single step, begins with.

[kittydesade]

Hell, every great journey is made up of thousands of tiny steps, just look at the last three years! It's just that when all you can see is the journey, it's way more terrifying than when you stop and look at all the tiny steps. :/

[kikibug13]

So very much indeed! *cuddles you very, very much. Like floofy cuddly thing*

[kittydesade]

*snuggleburrows, sighs* But! Better now. One step at a time. Possibly tonight there will be scheduling and things.

[kikibug13]

It's getting better all the time...

... oh yeah. Not a Beatles day at all. >.>