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Posted: Jun 07 2009 12:30 am

Cause as if I didn't have enough on my plate as it is, I am looking to purchase my first home. However I am clueless about the process. I'm not looking for anything EXPENSIVE maybe spend aroun $80,000 tops. Is there something I should be looking for over anything else like lot size, sq. footage, age of home, taxes? I'm completely oblivious and I don't want to get lead around by a realtor. Any help or advice would be much appreciated. I plan on starting my search next week.

Joined: Apr 14 2006 Location: Lake Michigan Posts: 3332

A realtor really would be best to answer all your questions. The one I got last year when I bought my townhome was really helpful; then again, he was family.

There's tons of criteria to search by - price range, neighborhood qualities, property taxes, typical utility charges, and if there's any monthly assessment if you buy in a development that has an association to deal with landscaping.

Then you have to compare all of that along with square footage, the number of bedrooms & bathrooms, etc.

You can just search on realtor.com, but an actual realtor can sometimes search in places you don't have access to, as well as schedule walkthroughs for places, and get you in contact with other people you'll have to deal with: a mortgage advisor at a bank, a lawyer to deal with the paperwork at closing, homeowners' insurance agent, home inspectors, etc...

This is certainly the time to buy. The first time homebuyer's credit is up to $8,000 now if you buy this year. Just file a special form next April, and the government will give you free money that you get forever to pay back on in small, no interest payments.

Posted: Jun 07 2009 01:10 am

Where are you that $80k will buy a house?

Joined: Apr 14 2006 Location: Lake Michigan Posts: 3332

Yeah, that can't buy shit out near me. You would need at least twice that, and it would get you a shitbox in a poor neighborhood.

UsaSatsui's Youtube Channel · Posted: Jun 07 2009 01:14 am

Douche McCallister wrote:

Cause as if I didn't have enough on my plate as it is, I am looking to purchase my first home. However I am clueless about the process. I'm not looking for anything EXPENSIVE maybe spend aroun $80,000 tops. Is there something I should be looking for over anything else like lot size, sq. footage, age of home, taxes? I'm completely oblivious and I don't want to get lead around by a realtor. Any help or advice would be much appreciated. I plan on starting my search next week.

I've never bought a house, but I can tell you what I know. Anyone can feel free to correct me.

A Realtor could answer all your questions. It's their job, and if you feel like you're being snowballed by one, you can always ask another. But they're supposed to help you out, not just try to slip any old house by you like a car salesman. Realtors rely very heavily on reputation, and one who gets a bad one finds themselves with no clients (and probably minus one Realtor badge...it's not just a job title, it's an organization that keeps close watch on members).

If you have some cash stored up, look into foreclosure auctions. You can get a good house cheap.

Go to your bank or credit union and get pre-approved for a loan first. Talk to a laon agent, explain what you're looking for, and they plug the numbers in and tell you what you qualify for. With that pre-approval, the buying process becomes a lot easier.

For a mortgage, you will need to pay your property taxes on time (often with the mortgage payment) and also maintain homeowner's insurance.

When you buy the house, what happens is you make your down payment, the bank covers the balance with the mortgage, and the money goes into escrow (a third party holds it) while the paperwork is cleared up and the inspections and the like are done (I'm not sure actually when the home inspectors show up). And there's a lot of paperwork, but you don't need to do it all. A lawyer usually gets involved. There's that much paperwork.

Once it's done, the house is yours. But until you pay it off, the bank can claim it if you don't make your payments (the house is your collateral for the loan). You do, however, acquire equity in the house (the portion you've paid off).

UsaSatsui's Youtube Channel · Posted: Jun 07 2009 01:16 am

-bjork- wrote:

Where are you that $80k will buy a house?

If you get away from the major cities and go to some areas that have a glut of houses, you can get something for that price.

Joined: Apr 14 2006 Location: Lake Michigan Posts: 3332

I'm in the suburbs and that's unheard of. I guess Douche must be way out in rural country.

UsaSatsui wrote:

Go to your bank or credit union and get pre-approved for a loan first. Talk to a laon agent, explain what you're looking for, and they plug the numbers in and tell you what you qualify for. With that pre-approval, the buying process becomes a lot easier.

Yep, pre-approval makes everything easier. When you make an offer on a house, the sellers know that your money is good that way.

Posted: Jun 07 2009 01:30 am

I'm not in rural country haha. I live in a fairly large city. Erie, PA. Home of the Pizza Bomber, and one of the first mainstream school shootings. It's not a bad city, and it's a pretty nice place to live. Houses are really inexpensive if they are not in a subdivision or located on the lake front.

It's not that I am gonna get taken for a ride by the realtor but I probably will just nod my head and smile during whatever they say. I talked to a few people and my main concern was havin a down payment, but apparently it is common practice here that people can lump the down deposit into the mortgage.

Basically I should look to get pre-approved for X amount and go from there?

2011 SNES Champ Joined: Dec 04 2006 Posts: 1929

You think $80,000 is cheap? How about $11,000? My father bought a house for that price some years ago. Sure, it was in the middle of fucking nowhere, but it didn't even need any kind of repair.

Anyway, we've been searching for a house for some time too. Some time meaning 5 years. My mom is 52, and my father isn't very reliable, so we can't afford much.

If you know someone in your family who know their stuff, ask them to visit the house with you and comment on the state of the house. It can save you some headaches later.

Or better yet, just buy something that isn't completely run down if you can afford it.

Posted: Jun 07 2009 04:51 am

UsaSatsui wrote:

-bjork- wrote:

Where are you that $80k will buy a house?

If you get away from the major cities and go to some areas that have a glut of houses, you can get something for that price.

I dunno. There's something like 9000 repos in my county and it's still high unless you're willing to live in a crime-ridden neighborhood or a mobile home park.

$80k would buy a condo in the cheapest complex on Maui, though. That I would do.

Joined: Dec 06 2007 Location: Connecticut Posts: 11244

Douche,

My wife and I have been looking for about 3 months now. We have found a few good ones, but the prices are still way too high for what people are offering.

Before you go any further you should begin to talk with mortgage people. Get a few good faith estimates that include all costs (including closing costs). Make sure they run a credit check on you so that you can get pre-approved and you can get approval letters whenever you need them.

When I first started looking I figured that if I had 10%-20% of the money in the bank I would be all set. It doesn't work that way my friend. You need to pay so much extra money upfront that it is fucking ridiculous. The 8k bonus check from the government cannot yet be used for a down payment or closing costs (this might change).

After you meet with a mortgage guy, then meet with a realtor. Don't sign a contract with the realtor for a long duration unless you are very comfortable with them. Make sure they understand what you want and that they are dedicated to your needs. Remember they represent you and not the seller.

Some other very important info.
* Don't move your liquid money around right now. Don't change banks.
* Make sure your credit card bills are paid regularly and you are paying more than the minimum.
* Don't move any investments while you are doing this. If you need to liquidate money from actual securities, make sure it only takes 1 hop from the security holding into your bank. When you go for a mortgage they will be able to tell where money is, but they will want to trace how it got there. The easier it is for them to trace, the more likely you will get the mortgage. If your credit score is below 700ish you will be VERY happy you made their lives easy.

Let me know how it goes man. I hope you have some quicker luck than I have had.

Posted: Jun 07 2009 11:56 am

When I got my loan for my car some years ago my credit score was a 752. It shouldn't have gone down seeing how I repay my debts atleast twice as fast as normally allowed. Is the realtor company a completely different company then the people selling the house? How do you get one? If I can save money on a realtor that would be great, I pretty much know what I want it's just about going out and getting it.

UsaSatsui's Youtube Channel · Posted: Jun 07 2009 12:30 pm

Quote:

Is the realtor company a completely different company then the people selling the house? How do you get one?

A Realtor (capital letter) is an agent who helps a home buyer find a seller and vice versa and is a member of the National Association of Realtors. You can find a real estate broker that isn't a Realtor, but it's a lot like hiring an unlicensed mechanic or a disbarred attorney. To get one, you simply find one's office. You can check the papers, ask around, hit the yellow pages, and so on.

They're all independent contractors, and they work on commission. You can either find one who has houses to sell, in which case the commission will be paid by the seller (they're the one who contacted the broker to promote the house). You can also hire a Realtor to actively find a house for you, in this case, you may have to pay commission (or may not, ask. Sometimes in this case your Realtor and the selling one will split it).

Posted: Jun 07 2009 01:06 pm

They have liquid money now?! Shocked

UsaSatsui's Youtube Channel · Posted: Jun 07 2009 01:25 pm

Blackout wrote:

They have liquid money now?! Shocked

While I'm fairly sure you're kidding, "liquid assets" are assets that are easily spendable, like cash, or those that can be very easily and quickly converted to spendable form.

Posted: Jun 07 2009 01:38 pm

So if I'm looking the papers houses for sale and I contact a Realtor, I don't really need to hire one? I plan on looking for houses, I don't really need someone to look for me.

UsaSatsui's Youtube Channel · Posted: Jun 07 2009 01:45 pm

Douche McCallister wrote:

So if I'm looking the papers houses for sale and I contact a Realtor, I don't really need to hire one? I plan on looking for houses, I don't really need someone to look for me.

No, you don't need to contract with one to find you a house.

Most likely, you'll need to contact the one that's selling the house or houses you want. You call them, they set up a few meetings, you go see houses. And again, they answer questions far better than any of us could.

If you're so clueless that you're asking this board for advice, I highly suggest you do NOT buy directly from a private seller. There's a whole lot of things that can go wrong. You may want to know what they are.

Posted: Jun 07 2009 01:59 pm

I'm not asking the "board" I'm asking people who have done it before. I definetly don't plan on buying from a private seller because knowing my luck they would sell me a haunted house with gremlins in the closet and I would never even notice.

I'm not an idiot, honest, just looking for tips on what I should look for or what I should ask.

Posted: Jun 07 2009 02:22 pm

I bought a HUD house in a decent neighborhood when I was 21. It was in shambles when I bought it, but I took out a 203K loan and fixed it up the way I wanted it. My father was in charge of maintenance for a grocery store chain so his friends worked on my house for very cheap. I pretty much paid a total of $68,000 for a house that is worth four times that much. Look at the HUD houses in your area. You might be able to find a good deal. You will more than likely need to get a 203K loan to get it, but you can refinance to a lower interest rate once the work is completed.

Posted: Jun 07 2009 02:50 pm

Forgive my ignorance, but what's a HUD? This conversation is retardedly interesting and I'm learning a lot of really interesting shit haha. And hey, good luck to you Douche!

Posted: Jun 07 2009 03:12 pm

It's a government agency in the United States. It stands for Housing and Urban Development.

Posted: Jun 07 2009 04:14 pm

I'm afraid I can't help on the advice front, D, but I will say good luck--I hope you find exactly what you're looking for.

Posted: Jun 07 2009 04:49 pm

Cattivo wrote:

This is certainly the time to buy. The first time homebuyer's credit is up to $8,000 now if you buy this year. Just file a special form next April, and the government will give you free money that you get forever to pay back on in small, no interest payments.

My cousin works with the IRS and he said that last year there was an $8000 credit that you have to pay back and it was interest free, this year however he said it's $8000 you never have to pay back, basically free money towards a home.

UsaSatsui's Youtube Channel · Posted: Jun 07 2009 04:51 pm

Yes, the credit no longer needs to be paid back.

It's very hard to get a loan without near perfect credit, however.

Posted: Jun 07 2009 07:28 pm

What are the rules on a VA loan?