It's not a Pit since we're not out of it yet: Buying a first home is just not cool.

Miscellaneous and Personal Stuff I Must Share
1

El Perro Fumando and I are looking at buying a home to start our married life together. Trouble is, we’re in a major metropolitan market like DC; we’re young and though we have decent jobs, relatively poor. So a “home” was immediately downgraded to “a townhome or condo.” And condos are no good since you really don’t own anything. You pretend you own a bit of sky encased in your little box. So townhome it is. What with the unbridled construction of ugly oversized McMansions and nothing else, the supply of lower-cost but still decent housing is slim, and entirely in the owner re-sell market, but they are out there.

We get an agent, we look, we go to a few places that don’t meet our needs. We find one that does, admittedly for about $10000 more than we were really hoping, but we knew it was bound to happen in order to live in a competitive market, and in a town in said metro area where we can actually feel somewhat safe. But the place itself is solid. One owner since it was built, new (and decent model) appliances, good looking community and location. So we put in our bid. Hoping to get a little deal (and because we wouldn’t mind the help), we ask for $3000 lower than the list, and also ask for 3% closing assistance.

Get a call from our agent, who got a call from the selling agent. There’s one other offer in as of this afternoon, with the selling agent going to the seller this evening to make a decision. And compared to the other offer, our audacity to not automatically bow to the list price, and our hope to get some assistance on closing costs basically gives the townhouse to the other potential buyer because their offer doesn’t have our strings. But because the agent has not yet gone to the seller, she’s giving us a chance to revise. We had been going with the lower price and assistance not because we can’t pay the list without assistance, but because we were hoping we wouldn’t have to. So we revise to list price (that $3000 really was a token reduction in the price anyway) and drop our assistance request to 1%, hoping it makes us more competitive, but still not completely just caving to the seller’s demands (though really, we are).

Our agent calls to say that the loan officer we’d been working with for the preapproval in order to get this whole ball rolling had been contacted by the selling agent to make sure our credit really was fine, that we really could pay what we said we could pay. We can, the loan officer answers. The agent says this is good news, we’re being taken seriously.

So now we’re playing the waiting game to see if we’re the selected offer on a townhome that will meet our needs, that we do have the ability to purchase, but for more than any small first townhome should really sell for. Damned McMansions and the absense of any new construction under 3000 sqft.

2

I feel your pain. We’ve just bought (closing is May 31) and the past week has just been a big old ball of SUCK. Our pre-approval nearly fell through due to a false report on my credit history, so I spent my birthday freaking out.

We had to go out to Harford (we’re in close-in B’more county now) to find what we wanted for the money we wanted to spend - but we found it and we love it.

Good luck to you! Come help us move, and we’ll return the favour!

3

I know it feels frustrating, but if it makes you feel any better, you got off light compared with what Hubby and I went through.

Our agent turned out to be a lying, devious jerk. He pointed us to a house that we liked, and said that all it needed was a little bit of “lipstick and rouge.” We put in an offer, but insisted that we add a clause in our offer that if there were any major repairs to be done, we had to approve of how they were done and have the work re-inspected before we’d close. He fought us on it, argued, insisted and cajoled, but we held firm and made sure that clause was in there. Thank God.

The inspection report came back with major issues. The foundation was sagging, the roof needed replaced (he insisted that the stains on the ceiling and wallpaper had to be old) and the electrical wiring was so bad that our insurance agent told us we would not be covered in case of fire unless it was all replaced. There were also myriad small issues, which if done all at once would cost a bundle, but they were things we could live with and repair over time.

We negotiated, because we really did like the house. We told the sellers if they would repair the roof, foundation and wiring, we’d still buy the house and do the little repairs ourselves. They agreed and said they’d send us the estimates.

Time wound down toward the closing date and I still hadn’t got estimates for the repairs. Our agent insisted that my fax machine must not be working properly because he had sent them to us several times. The ones he did send us were alarming: the homeowners had gone with fly-by-night contractors who gave the lowest price and were essentially going to slap a bandage on the problems, rather than fix them. As an example, with the wiring they were going to replace the box and any wires which weren’t in the walls, even though the ancient wiring couldn’t handle a 220 load without a potential risk of fire.

We told our agent that this was unacceptable, and we invoked our approval clause. He argued that we didn’t have to tell our insurance agent that the wiring hadn’t been replaced, and we’d be okay because it wasn’t like they were going to check. (At this point, Hubby exclaimed that he wasn’t as concerned about the insurance company as his wife burning up in a fire.) He said we were being “unreasonable” in our expectations and told us he’d sue us if we didn’t buy the house. We walked out.

Unbeknownst to the agent, my grandfather was good friends with the owner of the realty company. That night when I told him about it, grandpa picked up the phone and called the owner at home. “What’s this I hear about you suing my grand-baby?” and was instantly assured that the realty office, nor any of its agents would sue me. I sincerely hope the agent got called on the carpet for that the next day.

Turns out we were at the top of a six-sale chain. The owners of the house were going to buy another through the agency, and *those *owners were going to buy a house from the agency and so on, which explains why he was so avid that we buy it. The chain fell apart after we refused to buy it.

After the closing date passed, the agent then contacted the family who owned the house and urged them to lower the price and sell it as soon as they could, then sue us for the difference. It was a virtual guarantee that they would get the money from us. They followed his advice, and soon after, we were served with the suit papers.

It was settled before it hardly began. We had a pre-trial hearing with a judge who almost immediately agreed that we were in the right because of that clause we had insisted on putting in the contract. (There were also gross flaws in it which would have made the thing questionably legal anyway.) The plantiff’s lawyer came out of the conference with the judge and after consulting with his clients, asked if we would at least give them the earnest money we had put down with our offer. We agreed, and that was the end of it. I’ll never forget the dissapointed look on the wife’s face, or her husband’s look of frustrated anger.

When we next went into the market to buy a house, we put about six clauses into the contract, protecting ourselves six-ways-from-Sunday. Our new agent was a little baffled by our dilligence, but agreed to whatever we wanted.

4

Holy crap, Lissa! You win this thread on the third post. I’m glad it eventually didn’t burn you.

Thankfully, we don’t have a lot of those problems. Our agent is highly recommended by a former client who loves her place. The agent genuinely showed us a wide variety of places that were anywhere near our price range and location, and has been very prompt in giving attention to every telephone call or email we have sent. When I had concerns about this place (it is “as-is” because the previous owner died and willed it to her daughter, who just wants to sell the property ASAP and be done with it), our agent found the answers with the homeowners association and from the owner’s agent, and the answers have been honest and, thankfully, agreeable (such as all outside repairs like roof, gutters, fencing, sidewalk are responsibility of the association and paid for entirely out of association fees). Our agent insisted upon clauses that protect us, and even though the house is “as-is” and the results of an inspection aren’t allowed to affect the selling price, she still recommends we get an inspection for our own knowledge. She’s given us every indication, both by showing us during our tour of the place, and providing extensive documentation that she has received, that the nuts and bolts of the place are in order.

Can you call my mother and convince her that moving up to Harford near them is not a panacea to homebuying woes, and that the market sucks just as much up there as it does around DC? She won’t believe me.

I have…umm…a bad back…and bum knee…and an untreated hernia…and…ummm…religious observance forbids me to move anything heavy up stairs. Really.

But beer and pizza for you if you come help us!

5

Good luck to you and the future Ms. OMD…I hope you guys get it!

I sympathize with your back and knee…and I’m glad I don’t have the hernia, but please expand on the “religious observance”…I’m truly curious.

6

Quiet Yeti, you’ll blow my whole cover! Lissa shouldn’t know I’m the picture of health. When it comes to moving day, I’m one foot in the grave, capisce?

7

Just another quick tale of woe…

When we made an offer on our current house, we were excited that we would be inheriting a brand new, state of the art, super fancy stove. We made an offer on the house based on all appliances included, and it was accepted.

On one of the walk throughs, we wanted to take some photos of the house to show to our family and friends. Our agent advised against it, since the family was still living there, and it was an invasion of privacy of sorts (?), so we didn’t.

When we finally moved in, the first thing we noticed was that our dream-stove was now a piece-of-crap econo-box. The old owners flat out denied that any appliances had been swapped. We asked the neighbours, and they said that they saw the old owners swapping the stoves a couple of days before. Our lawyer agreed we could take them to court, but since we had no proof that the old stove was better than the new stove, we had very little chance of getting anything.

oh, and the old owners also took all the lightbulbs, and many of the window locks. Freaks.

So, my advice, is take photos of everything if you get another chance to do a walkthrough.

8

So it’s over, and we didn’t get the place.

Another buyer offered over list, and with no closing assistance, so we didn’t stand a chance.

The realtor sent on a list of a whole bunch of new listings, and none of them inspire any sort of interest. Fan-bloody-tastic.

9

I’m going to be buying a house as soon as I get back to the States. Whether it’s a new place, or a fix’er’upper, I’ll probably be doing some work on it for both a hobby and to try to kick up the value some.

But, I gotta ask: I’m a first-time buyer. What is the contract all about, and what clauses ought I look for/insert? I was under the impression that besides the tax records, registry, mortgage paperwork, yadda yadda, it was more or less as simple as buying a gallon of milk at the store.

I manage heavy construction for a living, so I’ve got that aspect down pat (could probably do my own inspection, too). But this legal stuff–is it really all that complicated? :confused:

Tripler
I’m not a lawyer, but I play one on TV.

10

I am right there with you in feeling the disappointment. I was supposed to close on my first home on 6/1. It was great at first, we bid, they accepted…then the home inspection came. Wow. What a nightmare. The inspector took us aside and told us the house was sick, and that we really needed to think about it. So we do, and offer them $40K less than what we originally offered. Back and forth we go. Finally, today, we just cancelled our contract and are walking away. There was just SO much work the house needed. Almost certainly more than the $40K. The inspection was the best money I ever spent, but I’m really sad that it didn’t work out. I am not looking forward to starting all over again…

11

Don’t fret. It wasn’t your home. Your home is still out there, waiting for you to find it.

12

Bummer.

On the bright side, the market in the DC area has really slowed down in the past year. Townhouses are sitting on the market far longer than they were - Sellers are holding out to get the price they’d have gotten this time last year, and it just ain’t happening. So there are a lot more choices on the market, and a lot of them are going through one or more price drops before they sell. I’m guessing that the place you looked at had been priced very well, to get two offers in such a short time. If you look for places that have been on the market for a little while, you might have better luck offering less than list. Still, it’s quite possible to spend 400K or more on a nothing-special townhouse (our former townhouse, no garage or anything, was resold sold for nearly 500K last fall, 3 years after we sold it for considerably less than that).

I’d avoid a condo around here. My gut feeling is that their prices will drop substantially. I had two friends who bought in the late 80s during a previous housing upturn - and wound up having to take cash to closing to get out of their mortgages. Maybe if you found one in a really hot area of DC or Arlington but otherwise, be careful.

13

I can’t say it any better, so, what ivylass said. First time home buying is one of the most frustrating, annoying, stress-filled yet wonderful things anybody can do IMHO. When it’s finally all over and you get all moved in the feeling of “It’s Mine! All Mine!”* is exhilarating.

I walked out on closing at the house I’m living in now and I had the damn thing built. There were some overage charges that I had not agreed to and I flat out refused to sign until they were taken off. As I told the builder when I walked out: “It’s like this, the first of the month is coming up soon. Somebody has to make a mortgage payment on that house. My name ain’t on the papers right now but yours is”, and I left. Two days later, lo and behold, the overages disappear!

There’s a moral in there somewhere. Oh yeah, stick to your guns. When it comes down to closing, the sellers, agents, etc. are more anxious than the buyer for it to all be over with cause they get the money.

*Actually the mortgage will be “Yours! All Yours!” but take heart that you’re paying for something that will one day be all yours.

14

Mendacity and stupidity all in the same package. How very efficient of him. :rolleyes:

15

I bought last August, and spent most of the summer chewing my nails over it - offers, counteroffers, the inspection - termite damage!, waitingwaitingwaiting - and of course, they tell you not to fall in love with a house, but I couldn’t help it.

So now I’ve been in it more than half a year and I love it more than ever. Totally worth it, once you get it, to have your own little patch of earth.

16

Nope. It doesn’t suck anywhere near as badly as DC. I can’t lie to your mothra. :eek:

And beer and pizza for you if you come help us.
:smiley:

17

Insert anything you want. Really. If the buyer doesn’t like it, they can simply refuse it. Read the contract and mark out anything that you don’t want to agree to. Don’t let your agent try to talk you out of it. Again, all that the result might be is that the seller would refuse your offer, but if it’s a reasonable request they refused, you might want to be leery of buying that property anyway.

The clause we inserted which saved our butts said: “Buyer has right of approval over how repairs are to be done. Repairs must pass re-inspection and have buyer approval before closing date.”

On our second round of house-buying, we also put into the initial offer that if inspection revealed significant problems, or if there were any problems with the deed* we reserved the right to withdraw our offer.

Never go with an agent who’s from the same agency that’s selling the house. The second time around, we refused to sign a dual agency form. I don’t care what they say-- their primary devotion in that case is to the seller.

Don’t use one of their recommended inspectors. Find your own. Ask friends and co-workers if you need advice on finding a good one.

God almighty, no. It’s a game rife with deceit, intrigue and avarice. Sellers often lie about the home’s condition.** Agents will pull every trick in the book to get their commission. The only person really watching out for you is YOU.

Unless, of course, you hire an attorney, which I strongly recommend. Have him/her review each step in the process to make sure you’re not getting screwed.

  • It’s more likely to happen on an older property than a newer one. Fences built over the property line, easements, long-ago liens that were never cleared . . .

** Happened to us second time around, even after we thought we were being so careful. The sellers claimed the basement had never leaked, but two months after we moved in, guess what happened? The sellers had bought the house only two years before, and claimed no leakage, or knowledge of previous leaks, but they gave us the inspection report from when they bought the house, which clearly said there was standing water in the basement. In short, I can prove with documents that they lied.

18

My fiance and I are also in the process of buying our first home. He wanted to be within walking distance of his job in the CBD, and we certainly can’t afford the $500k+ for any decent 2br house within 2 kilometres of his job. Body Corporate fees have ranged from $2100 per annum for a ho-hum pool, sauna and gym, all the way up to $6000 per annum for some elevators and a sinking fund.

Additionally there are lots of apartments in the Melbourne CBD that you really don’t want to touch as an owner-occupier. For instance, the 40sqm studio apartments that are really intended as temporary accomodation for overseas students, or the serviced apartments where 80% of the places around you are leased to hotels. And then there are the generic high-rises that sprung up during the housing boom, which it seems people are having a hard time getting rid of now.

We looked for about a year, and now we’ve finally found a gorgeous apartment in our price range. It’s on the top floor of a low-rise building and split across two levels. Location-wise it’s on a quiet street but close to everything, and a 1 minute walk from an enormous fresh food market. Inside it’s full of nooks and weird angles and sunlight. The place was advertised as 2 bedrooms but it’s really only a 1 bedder due to some massaging of the facts - IMO if you can’t open the door properly because there is a double bed in the room, it counts as a study. Because the place was fluffed up a bit in the listing, people who were looking for a 2 bedroom place thought it was far too small. But there were definitely people who were interested, just because the apartment is so charming and well-situated.

So my fiance and I thought that we should move fast and get a reasonable offer on the place before it went to auction. But the agent who was in charge of the place seemed … disinterested in the listing. I had called him on the day the listing came out to ask the square footage and the body corporate fees and he said he didn’t know but would be able to get them for the open inspection. Of course he didn’t have the information then, OR the Vendor’s Statement, which we needed in order to make an early offer on the place. I called him a week later and he sounded irritated that I was calling and said he would contact me as soon as he had the details.

Now it’s almost a week to auction day and he STILL hasn’t provided us with the contract that we need to take to the bank for them to approve the loan, not to mention basic information like body corporate fees or the square footage of the place. We have done everything we can with the bank, and this useless agent is the last domino we need to start the chain. We’ve talked to our lender, who has given us her mobile number and assured us that if need be we can push this through in 24 hours. Not even to make an early offer anymore, since we doubt a vendor would take an offer a week before auction, but just to be able to bid on the place. The agent seems more interested in holding open inspections for the apartment (the campaign is month-long and there are 2 open inspections a week) than actually following up buyers who have clearly expressed interest. And not “ooh what a pretty place! squee!” interest, but “We are interested in making an offer on this apartment. Here is my number, please call me when you have the Section 32 so our lawyer can look at it” interest.

He was so belligerent when I called that I really don’t want to call again. I’ve tried his company but since he’s in charge of the listing everything goes through him. My fiance will be calling him on Monday, 5 days before the auction. I know the apartment isn’t that expensive, and I don’t expect the agent to jump through hoops for us, but it really sucks that this wonderful apartment has such a horrible agent. And aside from that there’s the stress of falling in love with the place, knowing that it’s entirely possible we’ll be outbid on auction day. Aaargh!

19

Hmmm…I bought with a different agent in the same company as the selling agent, used one of their recommended inspectors, and lived to tell!

I think the best way to get a good contract is to get a good agent and the best way to get a good agent is to ask other agents or people who recently bought and sold for recommendations. I had a coworker who used to be an agent give me a recommendation, and the guy she picked was great. He explained everything to me in ways I understood and let me make all the decisions with information instead of his persuasion. Definitely get an inspection and have a clause about major flaws in the offer. Remember to ask everyone lots of questions because they are all making a buck off of your transaction. Ask the mortgage guy what he thinks of the buying and selling agents and the title company and ask your agent what he thinks of the agents and the community and the future of the location and building.

OMD, you might do better off to rent a year and wait for the market to shift form seller’s to buyer’s market and get off alot cheaper.

20

In addition to location, location, location one of my rules of real estate is never trust a real estate agent, never trust a real estate agent, never trust a real estate agent.

This rule was reinforced when we sold our house a few years ago. I’ve never heard such a pack of lies in my life.

“The basement’s finished.”

Well no it isn’t.

“The house is half an hour commute into Manhattan.”

Only by helicopter.

“The local schools are great.”

No, they suck. I know because I taught in them.

On and on and on in that vein by a few dozen over dressed idiots.

Fortunately we found a great agent who really listened to us when we bought the second time. She showed us a dozen houses in our price range in an afternoon. We made an offer that was accepted on my present house later in the day.

I strongly suggest finding an agent that you’re comfortable working with.