Lessons on Buying a House: The Big Day–It’s Mine!

The funny thing is last night I slept better than I have in a long time.  I’m not sure why exactly; I guess I expected that it would all work out OK.  Yesterday, I had the final walk-through with my agent, and I thought that I would have the closing papers in my hand, or at least in an email attachment, and also the actual amount that I would have to take to closing.  That was what I had been told by the title company.

However, the flurries of activity by my agent, their agent, the lender, the people from HUD approving all my paperwork, and the title company all seemed to continue–or maybe not.  I don’t really know.  I felt like I was in the dark.  I waited patiently–I’ve been a patient waiter in all of this, having done what I could do myself, letting all those other people, do their jobs.  Then about two hours before the supposed closing time, with still no word from any of them, I made one call to my agent, and within about 20 minutes I had a call from the lender with the amount of the check I had to take for my closing costs.  But just to show how loose ends everything was at that point, during our phone call the amount changed.

I hurried from work, went and got my cashier’s check, and headed to the title company.  The seller’s agent was there, as was my agent.  The sellers weren’t, because they now live overseas, which just led to more complications because another agent was there who had Power of Attorney for the sellers, or shall we say, got Power of Attorney via long distance to the title company officer.

There were several other loose ends to be tied up, a lot of signing to be done mostly by me, but also by the sellers’ agent and the agent with Power of Attorney.

Then the signed papers had to be faxed or emailed (I didn’t see that) back to my lender’s office for approval, and, of course, some of the paperwork had to be redone.

It was almost a 3-hour session, but I totally enjoyed the experience, the culmination of all the driving to look at neighborhoods, all the worry about whether I would get the loan, all the weirdness of looking at houses filled with the stuff of people I didn’t know.

Though I’m back in my snug apartment tonight, with a cold rain blowing from the north outside, I’m happy with myself for having pushed myself to get my own house.  It’s going to be a big change, but I like the house a lot and I know that I’ve moved myself into another stage of my life, not something that I had to do, but something that I needed to do.

Lessons on Buying a House: The Final Countdown to Closing

“Scurrying” and “a tiff” might be how I’d describe some of the goings-on today related to the final steps before closing.

The corrections asked for by the VA-approved appraiser appeared to have been made. My agent had talked to the appraiser and then made arrangements for the contractor (small-time, not big-time) to get everything remedied. All of the items which had appeared in the appraiser’s report that needed attention had been taken care of. I went out myself and checked it all, and everything looked OK. Even the removal of the spacers between the patio and foundation had been pulled out. (This has to be one of the weirdest rules I’ve heard of. Even though this long board was between the concrete of the foundation and the concrete of the patio, because this piece of wood was touching the foundation, which is part of the house, it was considered “conducive for termites”. Now there is an inch-and-a-half gap between the house and the patio that I will have to fill, probably with a spacer board; somebody has recommended redwood.)

Anyway, it seemed as if the house should pass on all the corrections, but when the VA-approved appraiser went back yesterday, did it? Oh, no. There were still a couple of corrections that had to be made, ones he said were obvious in his photos on his report. Obvious to whom, I don’t know.

It almost looks as if there might have been some sabotage involved. Between the time the contractor made the first asked-for repairs, some holes had been made in the siding on the garage very near the repairs. I know that Saturday when I looked at the completed repairs I didn’t notice any holes. Could this have been done by the appraiser when he came back to re-inspect? At $75 a pop for each re-visit to the property for just a couple minutes of inspection, maybe that’s what happened. I’ve heard that in these days of a slower real estate market, appraisers and inspectors aren’t getting so much work.

Therefore, a good deal of scurrying took place. My real estate agent went out to confer with the contractor. The contractor did some corrective repairs. My agent informed the finance company that the repairs had been made. Apparently, the finance company got the appraiser back out for the re-re-inspection (yep, that’s my new word).  All of this happened with in the expanse of a few hours.

I guess everything passed the re-re-inspection because within minutes of my asking the finance officer if the closing was still on for Friday and her telling me “yes”, my agent called me and asked if I could do the closing on Thursday afternoon instead of Friday.

There was scurrying and “a tiff” between the finance officer and my agent, both maybe anxious to get everything finished. It’s a little bit funny because when you get to this point in the buying process, most everything has been set in motion, and, unless for some reason you just decide that you don’t want to buy the house, there is not really much that the buyer has to do. You might have to provide a bit more information here and there, like your very last pay statement or an address that you didn’t know when you were filling out forms. Otherwise, all these other people are “scurrying” to get all the I’s dotted and T’s crossed.

The finance people, your agent, the seller’s agent, the title company people, the contractor–all of them are hurrying to get the whole purchase process completed.

In these last few days, I’ve felt a bit like I was watching a strange tennis match played among all these people, because now I know that in addition to the few phone calls and emails that I was party to, there were many others between these other “players” in this sale.

Why? Because when this whole deal is finished, they are all going to get a piece of the pie. And if for some reason, it all doesn’t go down, that pie is not going to get cut!

And what have I been doing? Actually, I’ve been doing a lot. Making arrangements to transfer utilities, finding someone to change the locks, checking out lawnmowers.

And to accomplish one of the first tasks that I want to complete in my new house–checking out paint strips.

Lessons on Buying a House: The Inspections and the Appraisal

It’s only one week until I close on the house.  Finally, I’m feeling that this is really going to happen and I’m getting anxious–the good kind of anxious.  The nervous kind of anxious I’ve been havin’  for so long that I can’t wait until I can sleep a whole night without waking up thinking about it all.

I’ve definitely told myself that I’m moving because today I made the arrangements to stop the utilities here and start them in the new place.

Today I also went out to the house to check on what the contractor has completed.  Because I don’t have a key yet, I could only check out the outside.

This brings me back to the inspections and appraisal.

I’m getting a VA-guaranteed loan, so I hope what I’ve experienced may help anyone in a similar situation, because no matter how much you read and how many questions you ask your agent, there seems like there are always surprises.  Here are some of the details about the inspections and appraisal that I had done ( none of which can really be done until you’ve made an offer and have a signed contract with the seller with a stated price):

The Home Inspection: This is done so you can know what problems there might be both inside and outside of the house.  Most likely, as a prospective buyer, you will have looked the house over pretty thoroughly and discovered some of the obvious problems, but a good home inspector should know a lot more and have specific equipment to get into places (such as ladders and moisture-identifying meters) that a normal buyer doesn’t have no matter if he has looked at the house several times.

On inspection day, it’s good to hang with the inspector, ask questions, and just learn about all that house contains, both good and bad, after all, you are paying the guy!  My inspector was cordial and informative, and I felt comfortable asking him anything.  His inspection took about three hours, and then he followed it up with a 38-page detailed report, which included lots of photos.  He charged $275, which I thought wasn’t bad.  The price is determined by the size and age of the house, and all of the extra features it might have to be inspected (such as a swimming pool or lawn sprinkler system).

If problems are found, this inspection allows the buyer to re-negotiate with the seller for a lower price or to ask the seller to repair things.  What I learned is to ask the seller to fix everything that needs fixed.  Although the sellers I’m dealing with initially said they wouldn’t pay for any repairs, when my agent sent them an amendment to the contract, they agreed to do everything we requested.  There were still a few things I hadn’t asked for, and now wish I had.

Although a copy of this inspection went to my finance company, surprising as it may seem, the VA doesn’t require that this inspection be done.

The Termite Inspection: Some home inspectors will also do a termite inspection, but mine didn’t but recommended another guy for this job.  I didn’t go to the house for the termite inspection, but my agent went to let the guy into the house.  It couldn’t have taken much time because the termite inspector called me to tell me he was finished about 5 minutes after their agreed-upon meeting time.  He didn’t find any evidence of termites, but he did find several problems, which he cited as being conducive to termites: some foliage too close to wood siding, a bit of rotting wood at the bottom of door frames on the garage, and wooden spacing boards that were put in when a new patio was laid.  The cost of this inspection was $80 and was required by the finance company and seemed to be required by the VA.  However, the information that I read about VA loans says that this is one of the items that “the veteran cannot pay for.”  We’ll see how that falls out at the closing, because, sure as the world, I did pay for it.

The Appraisal: After the home inspection is done and the buyer (veteran) decides that he really wants this house, that’s when all the real paperwork must be signed for the finance company.  (The buyer definitely has been approved for the loan prior to this and has already supplied the finance company a load of documents–at some point I’ll add a post about all the documents I presented to the finance company to get approved, but not now.)  Among all these papers is one document that gets the appraisal process started, and the buyer (veteran) has to pay for it; you can pay up front or even put it on a credit card.  It cost me $400; this may vary a bit state to state.

The finance company arranges for an appraiser from a VA-approved pool of appraisers.  I kept waiting for someone to contact me to say the appraiser was going out to the house to do the appraisal, but then, to my surprise and elation, my finance officer emailed me that the appraisal had been done and, basically, without any unexpected problems, I would be getting the loan and the house!

The appraisal actually has two aspects to it.  One is to determine the value of the property.  This is done to see if the house values more than the amount of the loan the buyer (veteran) is asking for.  If it doesn’t, the buyer will have to try to get the seller to come down or be willing to put in more money up front to cover the difference.

The second part of the appraisal is really another inspection.  The VA says that the house must be livable and that this inspection is for safety purposes not cosmetic problems.

My appraisal came out mostly positive.  The house appraised for more than the amount I agreed to pay for it, and as far as the inspection part, the VA appraiser noted basically the same problems that the termite inspector had.  Therefore, these have to be remedied, and then both the termite inspector and the VA appraiser have to go back out to house to give their OK.

That’s why I went out to the house today because the contractor has been working to repair what I had asked the sellers to do and also the areas that the inspectors required.  Some things look complete, but it looks like he has a bit more to do.  I’m hoping that it gets done tomorrow, as the termite guy and the appraiser are set to go back out on Monday.

Lessons on Buying a House: Another Big Day–Signing the Papers for the Finance Company

It looks like this is moving along.

Today was a big day in many ways.  First, during a break at work, I walked the three blocks down to the county tax assessor’s office to renew my car registration.  It’s gotten hot and muggy again in Houston, more like August than October.  We’re supposed to get some relief with a cold front this weekend, and most everyone is anxious for that, but today, my short jaunt was a hot one.

Another deed I got taken care of was my flu shot, not the swine flu one yet, but just the normal one.  It’s something I’ve been doing for the past several years and I think it works.  The nurse who gave me the shot commented that the flu shot is one of the best medical inventions since penicillin.  I don’t know if I’d go that far, but, like I said I think it works.

My agent sent me several emails.  One was that the sellers’ agent had remedied a couple of the electrical problems we had on inspection.  Then he said I needed to arrange for a termite inspection, so I did.  It’s set for tomorrow, and my agent is going out open up the house for the inspector.  I’m still feeling pretty positive about my agent.  He’s been on top of most things for me, even though I’m pretty sure that normally he’s involved with higher-dollar properties than my little purchase.

Then I got a whole slew of documents from the finance company.  Among the many pages was the Good Faith Estimate.  I was really pleased because the money that I will need to take to closing is less than half what I had expected.  Of course, the earnest money that has gone to the title company will help count against the closing costs, and that is my money too.  I was even more surprised because I have to pay for a survey and also a year’s homeowner’s insurance, but the finance officer said that was already included.  The big thing is that as part of the offer contract I asked the sellers to contribute to my closing costs and that does reduce the amount I will have to bring to closing.

Having the sellers pay something toward the buyer’s closing costs, in my view, is a bit of a double-edged sword.  On one hand, it does help reduce the closing costs for the buyer, but, in reality, the seller may have kept the negotiated price of the house higher, and because the price is higher, what is really happening is that the buyer is just financing the amount of money that the seller is contributing toward the seller’s closing costs.  But it can help the seller too, becaue he doesn’t have to come up with as large of chunk of money to bring to the closing.

What I finally did today was go over to the finance company and sign all the papers, rather than sign them and either scan them or fax them back.  With that many documents to be signed, it was a lot easier and quicker, not too mention, the finance officer was able to explain some of the points that I was unclear about.

The next and most like the last big step will come with the appraisal.  It seems like the big question mark because with so many foreclosures, the county tax valuations have fallen quite a bit from 2008 to 2009.  Also because my appraiser has to be VA approved, I don’t know how that will play out.  Some people have said these appraisers are more strict than others.  Because I only did all the paperwork for the finance company today, I’m not expecting that the appraisal will be done until next week–just another thing to wait for.

Yeah, that photo at the top is a teaser–it’s of the front of the house.  Keep your fingers crossed.  I am.

Lessons on Buying a House: The Latest Update, and Even Better–A Mortgage Calculator!

This is going to be short; it’s past bedtime, but here’s where everything stands.  Last Thursday, the offer contract finally got the buyers’ signatures and my final signature on one point that I finally caved in on–the number of days on the termination option.  I wanted 14, but they only would go for 10.  As one of my friends said, “Don’t sweat the small stuff.”  It really wasn’t such a big deal, anyway so far.

Fortunately, I was able to get an inspector, who had been recommended by a colleague, to do that job on Saturday.  Also, fortunately, unlike the first agent I had, who had also been recommended by a friend, the inspector turned out to be great.  I went out and pretty much stayed by his side for most of the 3-hour inspection.  He was both informative and helpful, showing me not only problem areas, but also making suggestions for various types of maintenance to keep up the house.  He had no problem answering my questions, even, I suppose, as naive as some of them probably were.

There weren’t too many surprises because most of the problem areas I or my agent had spotted on two previous visits to the house.  A number of problems relate to electrical aspects, because the current owners seemed to have done a lot of jerry-rigging of various electrical lines and connections, especially in the garage and to some “ambient” lighting outside, but there inside electrical problems as well.  There were quite a variety of other issues, maybe the biggest one being the roof, which is getting toward the end of its life.  Even so, the inspector told me it wasn’t going to leak.  That means it’s something that I won’t have to do right away.

I was pretty beat (and feeling kind of beat up too) Saturday after the inspection; there was a lot of information to take in, and I seemed to be able to think about just the problems, even though there are so many things about this house that I really like, especially, the upstairs bedrooms and the 2 and 1/2 baths.  Yeah, one guy with 2 and 1/2 baths!  What a deal!

Today my agent called and wanted to talk about the inspection.  I thought, “Oh, no, there’s some problem.”  However, when I got to his office, he told me that the sellers’ agent had been pretty amenable to some of the things that we had previously wanted, so we made a list of repairs that I want to be done, and we made an addendum to the original paperwork.  Hopefully, the owners will agree to repair or pay for the repair of some of these, and that will be just that much less I will have to worry about doing or paying someone to do.

My agent recommended also doing a termite inspection, but he is also going to ask the other agent about what has been done previously.  Then the “biggie”–the appraisal.  The finance company has to get a VA-approved appraiser to do it, and, of course, that’s something I have to pay for.  If the appraisal all works out OK–meaning the house is valued at more or at least the amount of money I am borrowing to buy the house–then basically, everything will be a go.  The last thing will be a survey, something else I have to pay for, but which is required by the title company.

Sometime soon, my finance company will give me a “good faith estimate” of what my total loan will be, what remaining closing costs I’ll have, and what my monthly payment will be.  I’ve already got a quote for the homeowner’s insurance and it’s less than I had expected, so that will make my monthly payment a bit lower than I had thought.

If you’re new to this as I am, here’s what’s included in monthly payment:  payment on the actual loan (principal and interest), taxes on the property, including any Homeowners Association fees; homeowner’s insurance, and PMI (which is a type of loan insurance that lenders require).  However, with a VA loan, there is no PMI, because that is actually what the VA is doing–insuring your loan to the lender.  On the other hand, there is a VA funding fee, which is paid to the government and now is at 2 percent.

Here’s is the mortgage calculator that I have been using.  It has really come in handy!

Sorry I haven’t been posting much on here, but there’s too much mental and emotional energy being expended in all this to have much left over for blogging.

OK, so maybe that wasn’t so short.

Lessons in Buying a House: The Process Continues . . .

Acquiring a house takes up a lot of energy–mental energy that is.  There are emotional highs when you find a place that you really like, lows when barriers get in the way, and there’s lots of waiting, which gives you time to think even m0re, which can be almost all-consuming.

This coming week will be a big one I think.  We’ve agreed on a price and most everything else.  If the offer comes back signed from the sellers, then the finance company must give their first OK and let me know all the details of my closing costs and what my monthly payment will be.  The sellers also have to get the utilities turned back on, so I can get the inspector. They had someone in the house when I first looked at it, but they moved out and now the utilities are off.  The inspection is one of the biggies.  To the inexperienced eye, there doesn’t look to be many problems, but that is why you have an inspector check it all out.  Then if there are no major problems with the inspection, and I still want the house, there will have to be an appraisal done to ascertain if the place is worth what the finance company will be loaning me.  Also, the sellers don’t have a survey, so that will have to be done.  Finally, I have to get hazard insurance (home owners insurance) as the finance company requires that you pay for a year of insurance in advance.  That’s four fairly good chunks of money to pay.  Fortunately, the second one won’t have to be done and paid unless the first works out OK, and, of course, the third and fourth won’t need to be done unless the first two work out.

I hope it all works out.  I think the house makes “a good fit” for me.  It has all the main features that I was looking for: nice, but not too big outdoor space, a big, very usable kitchen, and a shower in the master bath.  Even though it’s located out just a bit further than I would have liked, I’m hoping the drive won’t be too bad, and the neighborhood has a nice feel to it.  It’s also close to stores and necessities: a Walgreen’s, a dry cleaners, and a vet, just up the street, barely a quarter mile away, and two of my other favorite destinations, Barnes and Noble and Petsmart are just a mile down the road.  I went to check out the Barnes and Noble yesterday, and, yes, it’s definitely out in suburbia: they have row after row of books relating to religion and tons of educational materials that make it look like there must be a lot of home schooling going on out there, but they have only two shelves of gay and lesbian books.  Oh, well, I’m sure that they can order anything I might want.

I guess now I’ll have to pay less attention to “House Hunters” and “My First Place” on HGTV and take a better look at the decorating shows.  In fact, I’ve already found several paint companies’ sites where you can play around with different paint colors in various rooms.  The master in this house feels like someone loved pumpkin pie; that’s the first one that is going to have to be changed.  Oh, well, that can happen after all the papers have been signed and I actually have the keys in my hand.

So if anyone who reads my blog has wondered what has happened to me, all I can say is this house-buying process is such a big thing that it outweighs almost everything else right at the moment.  I just haven’t had the energy to care much to write about politics, history, or even the weather.  I know that all that will come back, and there will be many other things about which to give my two cents.

Lessons in Buying a House: An Update on What’s Happening, Sort of . . .

Since it’s been so long since I’ve posted, I guess I had better put something.  I haven’t been jazzed enough to write, but life otherwise hasn’t slowed down.  Work pulls me along, and I enjoy the routine of the days even though what happens moment by moment is only routine in that something similar has happened before.

The house hunting/buying continues.  I put in an offer on one that was good in price and commute, but not great in neighborhood, and definitely weak in kitchen.  (I might mention that this kitchen had only two drawers, one of which won’t open unless you open the oven door first.  I have a small, but better kitchen in my apartment.)  Actually, the bottom line was that the houses are going for a good price (good meaning low) in this neighborhood, but this seller wouldn’t go down to the range of the comps.  In the end, I was worried that even though I could afford the house, that the finance company’s appraisers wouldn’t appraise it high enough for me to be able to finance it.  I guess too the neighborhood and the house just didn’t feel right for me.

After I had put the offer in on that place, and while the seller wasn’t going down but baby steps in price, I found another place in a neighborhood that I like a lot.  Yeah, it’s out in the “burbs”, but it has a great kitchen.  The appliances do need updating (Do I sound like those first-time homebuyers from HGTV?), but the work space is great!  And I think I might even have to use even my toes to help count all the drawers!  It’s going to mean getting up earlier to get on the road to work, but did I mention the great backyard with even a pergula?  I’m not even sure I know how to spell it.  It’s one of those backyards that won’t take a lot of mowing–just enough to say you did it–and will make a great place for a little papillon dog to play and sniff and human folks to sit and drink ice tea, or whatever, and enjoy the evenings.

My new realtor has been great through all of this, helpful but not pushy, and I will soon add another post to follow up the previous one about what makes him good.  But for the moment, this isn’t over because we still have to put in an offer, negotiate, do the inspection and appraisal, finish the paperwork on the financing (My finance people have been great from the beginning; I guess that should be another post too.), and hopefully do the closing close to Trick ‘r Treat time.

If this all works out, there will be pictures!  And, of course, a PayPal link for donations for new furniture.  Just kidding, folks!

Oh, yeah . . . dig the new banner.  There are lots of toadstools, or mushrooms, whatever you want to call them, now that we finally have had some rain.  They are popping up in many places and seem to be big!  I guess they were just waiting to get through all that dry weather we had for so long.

Lessons in Buying a House: Choosing a Real Estate Agent

There hasn’t been much activity on this site for awhile, I mean on my part as far as writing anything new.  I’ve had a break from work, which rather than energize me, somewhat put me in a state of lethargy (deservedly so or not),  a slovenliness,  which, among other things, folded itself into a kind of writer’s block.

What’s been causing all this I already know: when I have a big decision to make, I also get stuck accomplishing other things.

Anyway, if you’ve read some of my earlier posts, you know that I’m in the process of buying a house, my first house.  It’s been an ongoing challenge for awhile now because I’ve been so methodical about it all, trying to be smart and make the best decisions.  I’ve already got my financing, with help from the VA and the expectancy of the $8,000 tax rebate to boot.

After I had secured my financing, I found a house that I really liked through har.com, and I wanted to check it out,but I didn’t have an agent, so I contacted one, based on a friend’s recommendation.  Even though I put in offers on two different houses with this agent, I never felt really comfortable working with her, and for a number of reasons, just didn’t trust her.  She didn’t help much with checking out the condition or value of the houses; instead, she advised me to offer the limit of my financing, and, in fact, told the seller’s agent what my limit was.  In the end, she seemed only to be pushing me to buy so that she could get her commission.

After that experience, I just have held off for awhile, knowing that I had to find another agent, but I felt like I had a block, just like writer’s block.  After hearing about my experience with this first agent, several friends and acquaintances told me about agents who they thought could help me, but I haven’t wanted to do that because now I have an uneasy situation with the friend who recommended the first agent, because he knows that I had problems with her but she is also his friend too.

So I did what I should have done in the first place.  As part of my whole process of buying a house, almost a year ago, I took a couple of Leisure Learning classes about financing and buying a house.  All of the instructors were good, but I felt one guy was really knowledgeable and down-to-earth.

Just a few days ago, I broke out of my lethargy and called him, and he was just as informative and helpful on the phone as he had been in the class.

Yesterday we met to look at a place.  It isn’t going to be “my first place”, but I realized that I had made the right decision in contacting him.  He’s much more of a “people person” than the first agent, and I feel that he understands someone like me, who’s buying for the first time.  Even when we got to the property, he didn’t rush me into looking at the house, but chatted first about other interests that we both had.  We looked at the place together, discussing the pluses and minuses.  And there was no push to buy or not buy.  Then we agreed to look at some other places that I’m interested in sometime next week.

So how do you find a good realtor?  I still don’t have an easy answer.  Here’s a site that gives some good questions that a buyer should ask a prospective agent.  I have read through them and even printed them out to put with all my “house buying stuff”, but I’m not sure whether most new buyers would just pop into a real estate agency and start interviewing an agent.

One thing I’ve learned is that some agents may have you sign an exclusivity agreement, which is a sort of contract.  However, in that case, you can put a time limit, so if I were unsure about how well I liked this agent, I wouldn’t make the agreement for more than like three weeks or a month.  If you don’t get a house in that time, but you decide you like the agent, you can always extend the agreement, or if you don’t like the agent, you can find another.

I think buyers, especially first-timers, are really at a disadvantage in the home-buying process.  After all, both agents get a larger commission the more the house sells for.  The seller too has already been through the same process at least once, when he bought the house, and he wants to get as much money as he can.

So I think the best buyer’s agent has to be someone that you can feel some connection with, some rapport.  Probably, a guy will have better luck with a male agent, and any other similarities, like age, and like in my case, sexuality.  (Yeah, I thought he might be gay when I took the Leisure Learning class, but I think I have probably the worst gaydar in the world.)  The more the buyer and the agent have in common, the more likelihood that they will look at a property in a similar way.

I’m still not to the end of making a determination about real estate agents.  In fact, I haven’t veered far yet from my initial impression that they are not much less greasy than car salemen.  Likewise, though you know they have to drive around a lot in their line of work, you also get another question mark sprouting out of the top of your head when they drive up in big black European cars.