Thursday, December 07, 2006

A Little Home-Buying Advice

I am so sleepy right now. I'm having dreams, folks. Will this or won't this work out? I'm pretty sure I dreamed of Daughter painting her room last night but that may have been brought on by the number of times she kicked me in my sleep. She was obviously determined to get into my subconscious, even if she literally had to karate kick her way in.

Still, this whole thing is making it harder to fall to sleep, that's for sure. My mind won't stop going, which is normal for me but this is a little past normal. The hurdle I was expecting to be the big hurdle isn't the hurdle that is currently on my mind. It's the loan. It was not as I expected it to be and it looked like we were going to be paying more for a mortgage than we were expecting and yet we can't be sure because our mortgage broker has yet to sit down with us and explain everything. When I called the broker to tell her about it she said to throw all that paperwork away. She wasn't done. Great day. I should have taken a picture of how much paper there was but I was only too happy to get rid of it, so I shredded it. Hmm. Maybe I'll take a photo of all the shredded paper tonight if Mr. T. hasn't tossed it out by now. In the meanwhile I do feel a little better because I got my insurance guy involved in this to do the homeowner's insurance. (If you are looking to buy, this is one of the things you may have to do for yourself, be aware.)

Overall, I still feel there is a lack of communication and generally too much, "Don't worry, be happy" being thrown about. So me being me, I take matters into my own hands. The broker gets a shot at doing this deal, mainly because it was already in the works anyway, but I spoke to a banker I know personally to see what she thinks and to see if she can do better. We have one week until closing. All we can do is see what happens.

Now, the reason I am writing this today is to share what I already knew (and got confirmation on) and to share what I've learned. If you are looking to buy a house for the first time ever (or if your first deal was a bad one), please take heed but be sure to go get your own answers.

Here are some of my thoughts on this:

1 - Get someone like you to represent you. I told you who our RE is and it was just part of the deal, as far as I am concerned. She had her own people that she deals with as well so that took away a lot of choices initially.

2 - Know it's ALMOST never too late.
When you sign your bid, ask about the contract. Will this be turned into a contract, or will there be one later to sign? That contract should give you the drop dead date for securing whatever you need so if you go. Mine got changed last night from Dec. 15th to "on or before Dec. 25th" but the broker is determined to stick to the 15th. At this point, we just have to keep going but I still have to get clarification as to whether or not we can call this quits if we don't like the loan that comes our way, or at least if we can put it off another few weeks to try another company. Frankly, I'm praying this woman gets it right, despite my leeriness of her because we all want to be done but we want it to be done right.

3 - Go to a first-time homebuyer's class if you can. I've learned a lot of things over the years and over the past few weeks. I know who to ask but if I could have done this, I would just to see what else I should know. It doesn't hurt to have the knowledge. You can't ask the right questions if you don't know what to ask and as my experience can tell you, not everyone will volunteer the information for whatever reasons of their own.

4 - Get an attorney as early as possible. If your RE or banker is handling it, cool, but make sure one is in their somewhere. You need someone neutral.

5 - Inspection/Appraisal/et al. You may be footing these bills and it's highly unlikely you will get this money back if you don't go through with the deal so make sure you really want this. As I told you before the inspection guy has proven to be the most helpful of all. If you live in CT and need a referral, I'll pass his name to you. I loved him. Speaking of bills, I mentioned finding your own insurance earlier? Well, that's something you not only have to do before closing but you pay for the whole year's worth of insurance beforehand as well, at closing. Be prepared.

6 - Shop around. Get that banker or broker to tell you upfront what kind of deal they are working out. Shop that around. You have to be honest with yourself, however. If your credit isn't the greatest, don't expect an awesome deal. Know your credit score so you can know what to expect. Down the road you can always refinance but you'll have to keep on top of your credit until that point because you still will need the best score you can get to get the best rate. And speaking of credit...

7 - Don't pull it too often. According to a financial expert I know, you have 2 weeks to shop around for bug ticket items like a car or mortgage. That means they can pull like crazy in that time and not have it affect your score. But after that, if they pull it you run the risk of getting hit in the credit score. Now, if you are using a broker (and I still don't think it's the best way to go but you do what you must), the possibility exists that they will pull your score to preapprove you. There is also the chance that the company they will deal with may do the same. Stay on top of them. Be sure you know your score prior to all this and be sure you are continuing to pay things as normal so you can know where to look if things go awry.

8 - Don't get emotional. Buying and selling a house is emotional stuff, no doubt about it. Buyers have to have a poker face and sellers need to grow some steel around their hearts. I am blessed to have smart friends and truly supportive family. I turn to them to help me think things through and not to let myself be ruled by emotions because I know I am an emotional person but I am OK with that. When things get tense, you need a cooler head. Someone neutral, like that lawyer. But if not the lawyer, then someone who will be HONEST with you about what they see and if they have real experience to add to the mix, then all the better. Just like the seller in this case who was allegedly insulted by my saying the carpets would have to go, you can lose out if you aren't careful. You have to keep your eyes on the prize but at the same time you can't be a doormat. If you're a go-along-to-get-along kind of person, you may have a hard time here so be honest about who you are (at least to yourself) and make sure someone tough is with you.

9 - Where's the proof? In case you didn't know, eventually you may have to prove you have the money. In the bank or somewhere that has your name on it. If you are expecting help, get it secured beforehand and stick it in the bank so it looks like you've had it awhile. Don't ask me. It just seems to be the way it is.

10 - Keep family out. I said it before and I stick by this. Try not to let your uncle the real estate agent do this job for you. Not unless you REALLY work well together. I know it's possible some relationships can handle this but why risk it? Unless you know for sure Aunt Mitzy the lawyer is going to do the job and not treat you differently or even worse because you are family, then take the chance if you care to. But I just think if you can skip them, do.

This is all I've got for you for now but if I think of anything else, I'll let you know.

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