Home Buying Help Thread

[TOUCAN]

I went back a few pages, and I am pretty sure I saw one for home improvement (which I'll get to) but I didn't see anything for advice on buying. You never know who could help and how they could, but I thought this might be a good place for any and all questions.

[TOUCAN]

My fiancée and I are just starting to look, our lease expires in August and we're getting married in October. Our roommate says she doesn't want to live with a married couple and I personally need to make sure I can have all 3 of my dogs without a problem so we're staying away from HOAs since we have one half pitbull (who is legitimately the best dog in the world and I'll go to war over this)

Anyone in PA or elsewhere know how to go about getting downpayment assistance and whatnot? Any experience in the field with lenders etc?

[JonStark]

24 minutes ago, JoshstraDaymus said:

My fiancée and I are just starting to look, our lease expires in August and we're getting married in October. Our roommate says she doesn't want to live with a married couple and I personally need to make sure I can have all 3 of my dogs without a problem so we're staying away from HOAs since we have one half pitbull (who is legitimately the best dog in the world and I'll go to war over this)

Anyone in PA or elsewhere know how to go about getting downpayment assistance and whatnot? Any experience in the field with lenders etc?

We bought a house a few years ago in Douglassville, PA. Just make sure you keep an eye on the taxes in the area. We were able to get a much nicer house there than we could've in other more populated areas. 

Oh, and pitbulls are amazing. Fostered a few over the past couple years and all have been super sweet and obedient. People who don't like them just don't know enough about them. 

[ramssuperbowl99]

IIRC, @Forge and @MKnight82 work in real estate.

[TOUCAN]

I welcome all info, things I should look for, etc. I'm meeting with a realtor this weekend also. My biggest concern is going to be downpayment and closing costs.

[skywindO2]

I went through the buying process last year. I would highly recommend meeting with a mortgage person first before meeting with a realtor, I didn't do it that way but I wish I had. I don't think it's my place to tell others how to spend money but you'll probably be qualified for a very high loan if your finances are even in half decent shape. Take that number and set your budget at around half that(roughly). 

Be extra meticulous but also flexible when you're viewing homes. Have a good idea of what you want and what concessions you're willing to make(these could change as you start get further in the process see more homes). Don't worry about taking a long time either. It took me about 7 months, making multiple offers and even pulling out of an offer after paying inspection fees. 

I don't know how good my advice really is. While I like my condo, after things I've discovered since then I don't think I would actually buy it now if I was still in the process. 

[Forge]

21 hours ago, JoshstraDaymus said:

Anyone in PA or elsewhere know how to go about getting downpayment assistance and whatnot? Any experience in the field with lenders etc?

Lots of lenders do various in house programs that you can look at. Bank of America has the America's home grant, for example, but their underwriting process is a complete and total bear. Guild Mortgage has a grant as well. There are quite a few. Most have restrictions with regards to the income you can have - typically, the income guidelines are in line with agency income requirements for their affordable housing programs (Homeready, Home Possible). These are removed in certain areas, though I'll be honest, the areas it's removed are typically areas of a city you wouldn't want to move lol. 

There are a myriad of grant options, tbh. Some can be found for specific areas, some are just general first time home buyer grants, etc. Look around and talk to loan officers. Don't just take the recommendations from a realtor or anything. Your loan officer should have a very good grasp of what should be available to you for DPA.

It is important to note that a lot of grants are often times forgivable second mortgages, so you want to know precisely what you're getting into in that regard. 

[theJ]

2 hours ago, skywindO2 said:

I don't know how good my advice really is. While I like my condo, after things I've discovered since then I don't think I would actually buy it now if I was still in the process. 

A lot of people rush into buying their first home right after marriage or graduation without really understanding what they want or need in a home.  You're not alone.  That's why most people move a few years later and the cycle starts over with the next sucker.

My wife and I rented for 4 years after we got married.  We still bought a house that wasn't quite right for us long term, and finally moved into our version of a dream home just this last year (11 years in).  Mostly because it took that long to save up enough dough to put down a huge down payment and make the payments palatable. 

20 hours ago, JoshstraDaymus said:

I welcome all info, things I should look for, etc. I'm meeting with a realtor this weekend also. My biggest concern is going to be downpayment and closing costs.

Real talk time: if you're concerned about having enough cash for the down payment and closing costs, you may be not be ready to buy.  IMO you should be able to pay closing costs and afford to plop down 20% before really considering to buy.  The reason is twofold: 1) you'll be paying PMI if you have less than 20% equity in a house and 2) you're taking a bloodbath on interest payments.

Finding a place to rent that allows pets is difficult, but they're out there.  I'd encourage you to keep renting, and save like a madman for 2-3 years.  It will make the buying process more smooth because you won't be stressed out, and you'll be a stronger buyer (sellers are informed how much you're putting down, and will sometimes go with a slightly lesser offer in favor of a buyer that's putting more down because that buyer is less likely to back out due to financial issues).

All that said, if you're determined to go through with this, i'd get with 4-5 lenders and make them vie for your business.  You're in charge here - make them work for it.  Tell them you're shopping around and that you want their best offer.  When you get the offers back, let the "losers" know what the current winning offer is and ask them to beat it.  You'll want to evaluate not just the interest rate, but also the closing costs.  You can shop around for a title company, but some of the closing costs are fixed by the lender.  I didn't shop around the first time i bought, and i probably paid too much.  The last time we bought i had 2 of the "losers" try to match the winning offer during the 11th hour.  I ultimately went with the company that had the best combination of terms, closing costs, and service.

And i'd do the same with a realtor.  Don't just hire the guy your friend recommended.  They might be great, but not the right fit for you.  Interview a few of them, and let them know you're interviewing them.  The wrong realtor can wreck your home buying experience.  There are things you want to know like their commission rate, and their process for helping you find a home, price the home, and help you negotiate the price.  Their personality and how it meshes with yours is important too.  You'll be spending some time with this person, after all.

That's enough for now...

[TOUCAN]

21 minutes ago, theJ said:

A lot of people rush into buying their first home right after marriage or graduation without really understanding what they want or need in a home.  You're not alone.  That's why most people move a few years later and the cycle starts over with the next sucker.

My wife and I rented for 4 years after we got married.  We still bought a house that wasn't quite right for us long term, and finally moved into our version of a dream home just this last year (11 years in).  Mostly because it took that long to save up enough dough to put down a huge down payment and make the payments palatable. 

Real talk time: if you're concerned about having enough cash for the down payment and closing costs, you may be not be ready to buy.  IMO you should be able to pay closing costs and afford to plop down 20% before really considering to buy.  The reason is twofold: 1) you'll be paying PMI if you have less than 20% equity in a house and 2) you're taking a bloodbath on interest payments.

Finding a place to rent that allows pets is difficult, but they're out there.  I'd encourage you to keep renting, and save like a madman for 2-3 years.  It will make the buying process more smooth because you won't be stressed out, and you'll be a stronger buyer (sellers are informed how much you're putting down, and will sometimes go with a slightly lesser offer in favor of a buyer that's putting more down because that buyer is less likely to back out due to financial issues).

All that said, if you're determined to go through with this, i'd get with 4-5 lenders and make them vie for your business.  You're in charge here - make them work for it.  Tell them you're shopping around and that you want their best offer.  When you get the offers back, let the "losers" know what the current winning offer is and ask them to beat it.  You'll want to evaluate not just the interest rate, but also the closing costs.  You can shop around for a title company, but some of the closing costs are fixed by the lender.  I didn't shop around the first time i bought, and i probably paid too much.  The last time we bought i had 2 of the "losers" try to match the winning offer during the 11th hour.  I ultimately went with the company that had the best combination of terms, closing costs, and service.

And i'd do the same with a realtor.  Don't just hire the guy your friend recommended.  They might be great, but not the right fit for you.  Interview a few of them, and let them know you're interviewing them.  The wrong realtor can wreck your home buying experience.  There are things you want to know like their commission rate, and their process for helping you find a home, price the home, and help you negotiate the price.  Their personality and how it meshes with yours is important too.  You'll be spending some time with this person, after all.

That's enough for now...

It's not a matter of not having enough of money saved up, I'm actually very good in that aspect, but I would like to minimalize it if possible one way or the other. I mean, the less I have to dip into my overall savings the better, ya know what I mean?

[theJ]

Just now, JoshstraDaymus said:

It's not a matter of not having enough of money saved up, I'm actually very good in that aspect, but I would like to minimalize it if possible one way or the other. I mean, the less I have to dip into my overall savings the better, ya know what I mean?

I get what you're saying.  My views on savings and investments are probably different than most. 

Yeah, i agree that you want to keep some cash stashed away for emergencies.  I do the same.  Have about 4-6 months of expenses set aside at any point in time.

And yes, you might want to keep a little side aside on the purchase for renovations.

Past that though?  I don't keep it liquid, and i wouldn't recommend it.  You don't need two years worth of savings set aside.  It's better off in something that's actually doing something for you.  Some choose to invest it.  Personally i'm a fan of getting the house paid off.  Everyone will have their own opinion.

 

Don't be afraid to put the money into the house.  It's an asset.  You're not losing the money.

[holt_bruce81]

I thought my GF and I were financially ready to buy a house about a year ago but we decided to hold off and save up some more until we absolutely knew we'd be able to put 20% down. Last year we only had roughly $10k to put down, so this year I've been just working a crap load and trying to save every penny. 

But my question is more about Renting a home. Right now we rent from her Dad, and honestly we wouldn't be able to find a better deal. We pay $500 a month and it's a decent start-up home. So staying here and saving as much as we can makes a lot of sense. My only thing is, the school districts and neighborhood aren't the greatest and my oldest one is starting Kindergarten next year. Do I look into renting something in a better school district/better neighborhood that will be more than double the rent we pay now, or do we stay where we are and save up?

@theJ would love to get your advice. 

Edited February 10, 2020 by holt_bruce81

[MWil23]

4 minutes ago, holt_bruce81 said:

I thought my GF and I were financially ready to buy a house about a year ago but we decided to hold off and save up some more until we absolutely knew we'd be able to put 20% down. Last year we only had roughly $10k to put down, so this year I've been just working a crap load and trying to save every penny. 

But my question is more about Renting a home. Right now we rent from her Dad, and honestly we wouldn't be able to find a better deal. We pay $500 a month and it's a decent start-up home. So staying here and saving as much as we can makes a lot of sense. My only thing is, the school districts and neighborhood aren't the greatest and my oldest one is starting Kindergarten next year. Do I look into renting something in a better school district/better neighborhood that will be more than double the rent we pay now, or do we stay where we are and save up?

School teacher and parent of a an oldest child entering Kindergarten this fall.

I understand the pressure of wanting our kids to attend "really good" schools, and that's why my wife and I are completing our move this spring. That said, IMO you'd be best long term in the investment (for the house) staying, saving up a lot more money, and buying your "ideal house" in 1-2 years, and not rushing into a new district for the sake of kindergarten. My wife, who is Pre K through 3rd grade, would even say that if you get a "fine" teacher/school for those first few years but diligently read with them, work with them, and help them, then it won't matter as much until a few years down the road after they learn how to read, write, and do basic mathematics. 

To be fair, I don't know your relationship status with your significant other, what the market will look like in 1-2 years, how that school district can/will change, what will happen with the legislation on public school vouchers, etc.

I hope this helps. 

[theJ]

32 minutes ago, holt_bruce81 said:

I thought my GF and I were financially ready to buy a house about a year ago but we decided to hold off and save up some more until we absolutely knew we'd be able to put 20% down. Last year we only had roughly $10k to put down, so this year I've been just working a crap load and trying to save every penny. 

But my question is more about Renting a home. Right now we rent from her Dad, and honestly we wouldn't be able to find a better deal. We pay $500 a month and it's a decent start-up home. So staying here and saving as much as we can makes a lot of sense. My only thing is, the school districts and neighborhood aren't the greatest and my oldest one is starting Kindergarten next year. Do I look into renting something in a better school district/better neighborhood that will be more than double the rent we pay now, or do we stay where we are and save up?

@theJ would love to get your advice. 

From a financial standpoint, it seems that you're okay to purchase if you wanted to.  The standard i held myself to was getting 20% down, and keeping the payment + taxes + insurance less than 25% of my take home pay.  So from that standpoint, you're not putting yourself in financial trouble by purchasing.

However...i can appreciate wanting to stay into a low rent situation for a while longer to build an even bigger downpayment.  That would allow you to purchase a nicer home in a nicer area, and have massive equity upfront.  That gives you great market protection in case things turn sideways, and keeps your payments low so you can do other things with your money.  You could maybe even go with a 15 year or shorter loan (which is what i did when we moved last year - the difference in interest paid over the lifetime of a 30 year vs. 15 year is staggering).

You do have some options though:

• Some states have public school vouchers - the criteria for eligibility is different everywhere, so you'll have to look into it.  But if you're in a bad area, you could maybe send your kid to private school for cheap for a few years until you move.
• Some public schools have open enrollment.  Downside is you'd have to drive your kid to school everyday because they won't run buses to your area.

I think i might ask for a meeting at the school you'd be sending your kid to next year and meet the teacher(s) and principal.  You might get some comfort that way, if you like the advice @MWil23 gave.

Past that, it's a decision you and your GF will have to make, because like i said it does sound like you'd be able to purchase without jeopardizing your finances.

[TOUCAN]

Update:

We met with the realtor and honestly more than anything, before any type of relationship with him and anything was written down, he got us on a good path and gave us some great insight about taxes and whatnot in the area. Like holt, my fiancee is worried about school districts and whatnot because if we had kids there is a district or 2 in my area that are for lack of a better term awful and cutting tons of extra curricular activities. Furthermore, while we aren't expecting, she (fiancee) has been adamant about wanting to do foster to adopt potentially which means getting into a better area earlier might not be a bad idea, and he took this all into consideration.

So, for what I'm looking for, we have a good foundation, and honestly my monthly payments in his mind based on a few things gives us more flexibility than even I thought it would. 

We will be meeting with a lender here in the next few weeks to get our preapproval letter and then the fun begins.

What a year this could be,

[Scoundrel]

1 hour ago, MWil23 said:

School teacher and parent of a an oldest child entering Kindergarten this fall.

I understand the pressure of wanting our kids to attend "really good" schools, and that's why my wife and I are completing our move this spring. That said, IMO you'd be best long term in the investment (for the house) staying, saving up a lot more money, and buying your "ideal house" in 1-2 years, and not rushing into a new district for the sake of kindergarten. My wife, who is Pre K through 3rd grade, would even say that if you get a "fine" teacher/school for those first few years but diligently read with them, work with them, and help them, then it won't matter as much until a few years down the road after they learn how to read, write, and do basic mathematics. 

To be fair, I don't know your relationship status with your significant other, what the market will look like in 1-2 years, how that school district can/will change, what will happen with the legislation on public school vouchers, etc.

I hope this helps. 

Are your kids in school yet?