Buying A Home
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
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Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
New here - buying our 1st house!
My FI and I are buying our first house (hopefully) and are super excited about it. We already met with a lender who told us what price homes she would approve us for. Now we have talked to a realtor and have our first weekend of home showings in about a month. We hope to be able to place an offer and close on a home by the end of May or June. Anyone have advice or insight they wish they knew the first time around?
Re: New here - buying our 1st house!
I wish I knew not to do it....kidding!
Every situation is different and there will probably be a lot that you figure out along the way. We just went under contract to buy our first house and I think I was surprised how stressful it was. We're well qualified with good credit and income and while we didn't expect it to be "easy", we didn't think it would be quite so hard either.
We happen to be in a very competitive market that is on a slight upswing and with everything out there (mostly) saying that it's a buyers market, we thought people would be throwing themselves at us trying to sell their houses. Didn't happen. We were in three bidding wars and we lost all of them, but were the back up offer on the third and the original buyer fell through. It worked out great for us because it's the one we loved the most.
You might be one of the lucky ones who finds the perfect house and gets it, but you might not. If you're not, try to keep motivated and stick to your list of "must haves" -- don't compromise unless your agent tells you that your budget is completely unrealistic for what you want. If you don't have to hurry, then I would definitely wait until you find something you absolutely love.
Unless you're in an area with an extremely large inventory of available homes (Ones that you like. And are in your price range.) I think expecting to find (and close) on a home in a 1-2 month time frame is hugely optimistic...and probably not at all realistic. So my first piece of advice would be to adjust your expectations a bit. (We started looking in April 2011, and closed January 2012.)
All of this. We were lucky ones who found a perfect house and got it. Within 48 hours of putting the original offer down. Do not settle by any means. You need to be happy with what you end up getting. It's still a buyer's market in our area. Good luck!
*TTC since 10/11*
BFP: 9/30/12, EDD: 6/15/13
*~*Our miracle arrived on 6/13/13*~*
One more thing:
We started searching the beginning of April, and closed on May 31st.
*TTC since 10/11*
BFP: 9/30/12, EDD: 6/15/13
*~*Our miracle arrived on 6/13/13*~*
We are right in the middle of the process just like you. We've met with a lender and have just begun to browse for houses (ideally we'd like to move june/july as our lease is up at the end of july but can easily go month to month after that). I'm sure you already know and have this but stick with your budget. It's so easy to be swayed higher and higher. Even though the bank gives you a max, you need to figure out if you are actually comfortable with that number and if it allows to you to continue with your other financial goals. I really liked that the lender we got pre-approved with (not necessarily the one we'll go with) did even give us a max number, he asked us what range we were looking in and then told us he would definitely approve us for that amount. We know we could on paper afford more, but we have some debt we'd like to pay off and start saving more towards starting a family. It was nice to not even be tempted by the bank's max to perhaps increase our range a bit more. It's definitely tempting, especially when a house slightly above our max that I love just came on the market. But I need to stop and think that even though we could afford that monthly payment, it would seriously slow down our other financial plans/goals.
But it's definitely been exciting/fun so far, but I know that stressful part is right around the corner
I agree with pp.
One thing I want to give you a heads up about though has to do with when you go look at other homes. My ILs wanted to come look at houses with us and as we get along for the most part we said sure. They were great other then my MIL was picky about stupid things, paint colors, wallpaper, and such, all cosmetic things. Do not take people along with you if they are picky about that sort of stuff. It will only hinder you search. We went back to every house that we saw with them that we liked just to see it from "our" point of view.
It was annoying more then anything. We ended up buying a house that she hasn't seen and won't see now until we get possession.
This is a fun time. Enjoy it.
One thing to note about your post is the stuff I bolded. Your lender will approve you for an amount, but that amount might be WAY more than you can or would want to afford. The lender is only looking at your income and any debts that appear on your credit reports. S/he isn't considering any other expenses you have that are not listed there (cells phones, TV, day care, etc.)
Before my SAHM life, I worked as a lender and spent lots of time educating my customers about how they still need to do a good review and assessment of their full financial picture and weigh it against what they will be paying each month for a home payment. Your lender might apprive you for $200k, $400k, $600k, but that doesn't mean that you would want to be buying a home that is that expensive.
Also, if you post this on MM, you will be asked how much of an emergency fund you have saved prior to buying a home, which is money that will not be put toward a down payment, but will be held in reserve. Folks there recommend anywhere from 3 to 12 months depending on your financial situation.
Yea, our lender actually did tell us she would approve us for a lot more but we told her a range where WE were comfortable. We are sticking with a price that keeps our monthly payments pretty close to what we've already been paying for the past 2 years with no problem. It definitely was tempting to go for that higher number though, but we resisted. Luckily, my dad is a real estate attorney in the same area we are buying a home so our lender and realtor are both people my dad has worked with for many years and are very well-trusted.
Are you saying you're planning on having your mortgage payments be similar to what your current rent is? Don't forget that property taxes, extra utilities, and homeowners insurance can add a big chunk to that. We're in the super early stages of looking (it might be several years), but it took me a little while to realize that owning a house costs more than just the mortgage payment.