A Roadmap to My Search For A Home
Posted By Jim On 06/15/2005 @ 11:02 pm In The Home | Comments Disabled
As many of the more frequent readers have known, I recently went through the daunting process of searching for a home, obtaining financing for a home, and then actually purchasing a home. The entire process was documented as it progressed (my ignorance is most obvious in the earlier posts) and so now, after the journey has concluded, a nice summary map of the entire trip would be helpful. I’ll just give a brief “executive” summary of the post and hopefully everything won’t be as disjointed and confusing. This is a very long post.
Pre-House Hunting Era
I wrote two articles before my first house hunting trip.
- PMI or Piggyback Mortgage?  – I opted for a piggyback mortgage instead of a loan with a LTV greater than 80% and paying the PMI, but in this article I compare the two and it may seem obvious why I went with that option.
- “Play House” – Pretending You Have A Mortgage  – I was reading a Suze Orman book and one interesting idea she had was to “play house,” or just save your expected mortgage payment in a separate account and see if you can actually handle the payments. I never played but it was a good idea.
House Hunting Era
- First House Hunting Trip  (April 11th, 2005) – Saw three homes, didn’t see one I liked but got a better feel for the market in the area – the market is freaking expensive. I talk about being a more discerning buyer and learning more about what I like in a home.
- That Damned Rent vs. Buy Question  (April 12th, 2005) – I did a personal evaluation of the rent vs. buy tradeoff and talk about some useful calculators at Dinkytown.net.
- Getting Pre-Approved For A First-Home Mortgage  (April 13th, 2005) – I send in some information to several places to see what sort of loan I can get pre-approved for, this is a critical step because sellers will probably not consider offers where the bidder hasn’t been pre-approved.
- LendingTree Is Ridiculously Fast  (April 13th, 2005) – This was posted the afternoon after I sent LendingTree some personal info. They actually had someone call me up and talk to me… they’re doing some solid work over there.
- Buddying Up with my Credit Union  (April 13th, 2005) – I talk about looking at my credit union about mortgages, unfortunately due to time circumstances I couldn’t actually follow through on the advice I talk about here.
- Closing Costs and Annoying Fees (and I made an offer on a house)  (April 18th, 2005) – This article summarizes what I understand about closing costs, all manner of fees, and my second house hunting trip – which resulted in my putting an offer down on a home.
- Online Real Estate Listings are Stale  (April 19th, 2005) – Basically, without a real estate agent you start at a disadvantage because all the websites have data that’s a few days late, unless you’re going For Sale By Owner. I also talk about how I up the escalation clause to the first house.
- First Home Offer Verdict – DENIED!  (April 19th, 2005) – I gave more specifics about the house and the fact that, as you can deduce, I didn’t “win” it. I was willing to pay up to $300k for a house listed at $290k, the eventual buyer paid $312k for it.
- Always Look at More Than Six Homes  (April 26th, 2005) – When I first heard the rule, I ignored it really, but after looking at my criteria for a house at this point and comparing it with the criteria initially – it’s like night and day, with respect to the level of specificity.
- Timeline and Costs of a Home Purchase (or, House Hunting Trip 4)  – (May 1st, 2005) In your contract offer, you detail what the timeline will be. In this article, I discuss what you’ll need to specify in your contract so you know what to expect. I’ve just put out a second offer as of this article.
- Understanding Seller Psychology – They Are Greedy  (May 4th, 2005) – This is a little unfair (and ultimately the house I do buy isn’t based on money) but all the other little details in a contract matter little compared to the purchase price. I was naive to think it would be otherwise. Oh yeah, offer #2 was shot down.. but I’ve put down a third article.
Pre-Offer Ratification (But Close)
We move out of the doldrums of just searching and move into a whirlwind four or five days where I am in serious contention for a home.
- Full Financial Disclosures and Gift Letters  (May 10th, 2005) – Now that we’re in contention, the seller wants more financial information to make sure that, if we’re selected, we can actually make it to closing.
- A Counter-Offer: Offer More or Wait It Out?  (May 10th, 2005) – Here is where I learn the seller wants a few additions to the contract and that we’re in second place. My agent wants to know if I want to add more money to the offer and I go into the reasons why I shouldn’t…
Ratification (I Have a House!)
The sellers picked my offer and, after a few more minor changes, after I work out the inspection, loan details, etc. I will have a home. They want to close in 2 weeks!
- I Own a $295,000 House – Buyer’s Remorse and 8 Contract Counters  (May 11th, 2005) – I learn that my contract was selected, the 8 contract changes, and relief sets in.
- The Good Faith Estimate and Meeting My Lender  (May 13th, 2005) – The long pole in the tent is getting the loan and the tent has to be finished within two weeks, or I potentially lose my $5,000 deposit. I’m not really concerned but my hand has been forced – I’ll need to use a local lender.
- Home Inspection, Termite Inspection, Home Appraisal  (May 16th, 2005) – I discover some minor issues and one major issue, the roof has some questions that a certified roofer will need to answer.
- Positive Home Appraisal and Roof Repair Requests  (May 19th, 2005) – Nothing terribly exciting, we simply fax over a letter requesting the roof be certified by a roofer and any problems to be repaired. The language is especially clear.
- Information Needed for a Homeowner’s Insurance Quote  (May 23rd, 2005) – I call up Geico and ask for a homeowner’s insurance policy quote and realized I don’t know squat about my house. I quickly learn so I can get a policy.
- Preparing To Close on a House  (May 27th, 2005) – For my own sanity I write out a few final questions I have, mere hours before the close, and have most of them answered very timely. The title company, unwittingly, did not give me the first-time Maryland home buyer credit… a cool $750 I could’ve overpaid for absolutely nothing. My agent should’ve caught it though.
- Experience At The Settlement Table  (May 27th, 2005) – And so the journey ends…
The first few months of home ownership are difficult since you don’t know what expenses to expect, what is covered by the escrow, etc.
- Insurance, Escrows and Property Taxes  (July 14th, 2005) – The HOA bill came but I knew that was covered in the escrow, but the first six months of insurance weren’t collected. The property tax, however, was collected so I’m in the clear on that… but there was some anxiety until I found out.
Looking Back & Lessons Learned
I took a look back after a few years to see whether or not I made good decisions, bad decisions, etc. given the housing slump that followed my purchase.
I hope those of you have had the time and energy to follow along enjoyed yourselves. To those who left helpful comments, I am extremely grateful. I started the journey knowing absolutely nothing and ended it knowing a little bit more than nothing and hopefully we’ve learned something new together. Thanks!
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 PMI or Piggyback Mortgage?: http://www.bargaineering.com/articles/pmi-or-piggyback-mortgage.html
 “Play House” – Pretending You Have A Mortgage: http://www.bargaineering.com/articles/play-house-pretending-you-have-a-mortgage.html
 First House Hunting Trip: http://www.bargaineering.com/articles/first-house-hunting-trip.html
 That Damned Rent vs. Buy Question: http://www.bargaineering.com/articles/that-damned-rent-vs-buy-question.html
 Getting Pre-Approved For A First-Home Mortgage: http://www.bargaineering.com/articles/getting-pre-approved-for-a-first-home-mortgage.html
 LendingTree Is Ridiculously Fast: http://www.bargaineering.com/articles/lendingtree-is-ridiculously-fast.html
 Buddying Up with my Credit Union: http://www.bargaineering.com/articles/buddying-up-with-my-credit-union.html
 Closing Costs and Annoying Fees (and I made an offer on a house): http://www.bargaineering.com/articles/closing-costs-and-annoying-fees.html
 Online Real Estate Listings are Stale: http://www.bargaineering.com/articles/online-real-estate-listings-are-stale.html
 First Home Offer Verdict – DENIED!: http://www.bargaineering.com/articles/first-home-offer-verdict-denied.html
 Always Look at More Than Six Homes: http://www.bargaineering.com/articles/always-look-at-more-than-six-homes.html
 Timeline and Costs of a Home Purchase (or, House Hunting Trip 4): http://www.bargaineering.com/articles/timeline-and-costs-of-a-home-purchase-house-hunting-trip-4.html
 Understanding Seller Psychology – They Are Greedy: http://www.bargaineering.com/articles/understanding-seller-psychology-they-are-greedy.html
 Full Financial Disclosures and Gift Letters: http://www.bargaineering.com/articles/full-financial-disclosures-and-example-gift-letter-template.html
 A Counter-Offer: Offer More or Wait It Out?: http://www.bargaineering.com/articles/a-counter-offer-offer-more-or-wait-it-out.html
 I Own a $295,000 House – Buyer’s Remorse and 8 Contract Counters: http://www.bargaineering.com/articles/i-own-a-295000-house-buyers-remorse-and-8-contract-counters.html
 The Good Faith Estimate and Meeting My Lender: http://www.bargaineering.com/articles/the-good-faith-estimate-and-meeting-my-lender.html
 Home Inspection, Termite Inspection, Home Appraisal: http://www.bargaineering.com/articles/home-inspection.html
 Positive Home Appraisal and Roof Repair Requests: http://www.bargaineering.com/articles/positive-home-appraisal-and-roof-repair-requests.html
 Information Needed for a Homeowner’s Insurance Quote: http://www.bargaineering.com/articles/information-for-a-homeowners-quote.html
 Preparing To Close on a House: http://www.bargaineering.com/articles/closing-today.html
 Experience At The Settlement Table: http://www.bargaineering.com/articles/experience-at-the-settlement-table.html
 Insurance, Escrows and Property Taxes: http://www.bargaineering.com/articles/insurance-escrows-and-property-taxes.html
 Home Inspection Repair Requests: http://www.bargaineering.com/articles/home-inspection-repair-requests.html
 Always Negotiate Mortgage Lender’s Fees: http://www.bargaineering.com/articles/always-negotiate-mortgage-lenders-fees.html
 Ask For A CLUE Report Before Buying: http://www.bargaineering.com/articles/ask-for-a-clue-report-before-buying.html
 Home Buying Autopsy: Title Insurance: http://www.bargaineering.com/articles/home-buying-autopsy-title-insurance.html
 Revisiting My Rent vs. Buy Analysis from 2005: http://www.bargaineering.com/articles/revisiting-my-rent-vs-buy-analysis-from-2005.html
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