[Sherryh]

My boyfriend and I have decided to buy a home. My kids and I will move into the home immediately... my boyfriend will join us after we are married. The home we are looking at buying is a beautiful Victorian home built in 1886. It has 4 bedrooms, 1½ baths, hot water heat, double garage, large corner lot, asking $79,900. We have been in the home once with the realtor, I am going back today with my kids and my boyfriend's mom, and we will be going one more time in the near future with both of his parents so they can really check the place out for us. What am I looking for from you is advice on buying a home... what to look for and check on and such. We will be going with a first time home buyer loan (interest rates are around 4% right now)... we have 3 loan options, some with no down payment, some with a low down payment, some with closing costs rolled in, some without that option. So loan advice is appreciated too! As is advice about moving from an apartment to a huge home, since we both live in apartments right now. Also advice on blending our family together... I have 2 kids and he has none... we have been doing well at this so far but any tips help!

Thanks!

 

[Guest]

*Make sure you have some cash on hand after the closing. You never know what will pop up in the first few months.
*Figure out if the mortgage company will escrow for taxes and insurance. Make sure you have those figured in your monthly budget.
*Make sure that you understand your mortgage. I'm not sure what options are currently available for no down payment, but if you roll the closing costs into the loan they'll become part of the loan and you'll pay interest on them.
*A big thing for us was figuring out if our mortgage would be sold. When we bought the house we paid a slightly higher interest rate to go with a smaller bank that holds all their mortgages in house; when we re-financed we picked a bank that sells the mortgages but retains the serviving rights. We've had a few issues with some of the real estate taxes not being paid (our backyard is a separate parcel with a separate bill) and I can solve it with one phone call, not getting stuck in a phone tree to talk to someone in India.
*Ask around what utilities run for similar houses (electric, oil if you have oil heat, water bill, etc.) so you're not totally taken by surprise.

 

[Contrary Housewife]

Get an inspection. Do not let the seller talk you out of this. DO it regardless of cost. You want to know about any foundation, electrical, plumbing, safety and other issues before you negotiate the price. Believe me, you will save yourself so many headaches down the road if you do this. It's not required everywhere and it should be.

 

[mndtrp]

Realize that there are a lot of costs associated with a house that many new owners don't think of immediately.

Repairs being the big one. Are you or your boyfriend competent with things like general plumbing, heating/cooling, minor electrical?

Landscaping costs: water, nutrients, lawn mower, shovels, sprinkler system/hoses, trimmers/shears.

Ladder, tools, saws, etc.


Your now empty-loooking house does not have to be filled up immediately. Take your time, determine what is necessary, and look for good prices in the meantime. As far as most of the things above, I went to Home Depot, opened an account with them for the 10% off and 12 month no interest financing, and bought all of the things that I determined I would need all at once. I have also used the same discount and financing for a couple of large projects that came down the chute.

More time will be spent working on and around your house. I was nearly bored in my apartment, but am continually busy at my house.

 

[Siebrie]

If you need to have an escrow account, can it be in your name, so that you will get the interest?

If you have to pay a slightly higher interest% on the 100% mortgage, will it go down after you have paid a certain amount (e.g. 20%) of the principal?

Will you get a discount if you also have life insurance, car insurance and property insurance through the same bank/credit union?

What happens to the house if something happens to or between you and dear boyfriend before you are married? Can you pay the full mortgage and extra costs? Can he? Will his family come after you for his share of the house or v.v.?

An old house needs a lot of maintenance. I don't know if the outside is painted, but if it is, can you let a painter come and give you an estimate of the costs of professionally painting the whole house? That cost will come back about every 5 years. If you can do it yourself, good, it will be cheaper, but still needs to be done regularly to keep the house in good condition.

 

[forHISglory]

Great advice so far!
If you have any problems with money at all, be sure that an escrow is set up for taxes and insurance, so that this is off your mind. Of course, many times you have no choice with that.

The inspection is vital. Try to get an independent inspector, and not one tied to the seller. Also remember that usually you have the right of refusal if the inspection shows items that are huge. Or you can renegotiate the price.

You can ask utility companies to give you the bills for the last year on the property so that you can see what is ahead for you. We did this, but unfortunately, found out that the couple who sold the home spent a lot of time in FL during the winter..... no wonder they had low heating costs in the winter!

Also be sure that you know what the taxes are, and if there are plans in the future for property taxes to raise. We found the taxes to be very high here. So I did an on-line search of the taxes of other homes in the neighborhood, and actually had the taxes lowered on our new home.

However, we ran into a big problem tax wise. Our realtor told us that the seller was paying his part of the taxes, and that we would receive the rest of the bill from the county. Well, we never received the rest of the bill, and didn't even know when the bill was supposed to come. Suddenly we received a mail notice that our home was going to be sold for back taxes on the courthouse steps!! What!?! I hightailed it down to the courthouse and they said that the tax notice was sent out, but they sent it to the former owner!! I asked how we were supposed to pay the taxes if the bill went to someone else. They just shrugged and said we should have known. So I paid the taxes and had to pay a hefty late fee, too. Then I contacted the realtor, who quickly said he would pay the late fee for us. Just to let you know that unexpected things happen!

Spend some time in the neighborhood at various times of day. Is traffic heavy at times? Is there noise at various times? Also find out if there are restrictions on how you can decorate your home and landscape. Sometimes places with historical homes will have very strict regulations.

I agree with another poster about having cash on hand when you move in, and not being in a hurry to fill your home with furniture. Just tell the kids it's a camping-out party!!

 

[frugal is fun]

I read an article somewhere that the new homeowner spends on average $4,000 in the first two months of owning the home on small repairs.

This was me. I spent $4,000 on small stuff like paint, brushes, supplies, new light fixtures, new toilet, new screen door, sheet rock, etc etc. All of the little stuff adds up very quickly so make sure you leave yourself some cash after the closing.

 

[ladykemma2]

budget 250 a month for maintenance. open a special bank account and punk the money. it will accumulate and then boom you will need it.

 

[windy138]

your avatar is very beautiful.
You and your boy friend are so happy :X
Like it!!

 

[taxgal1040]

Owned several homes over the years

1. I echo the posters that have suggested a home inspection. For a couple of hundred dollars, you and your boyfriend should follow the home inspector around. This gives you great knowledge about your new home, tells you where access panels and turn off valves are, and other important info about your new house!

2. Conduct a "trial" mortgage period. You should have received an estimate about how much your new home mortgage (including escrows) are, and you should be living on this amount. So it your rent is 700, and your house 1000, pay your rent, and put 300 in a savings account. If you aren't comfortable after a couple of months, then this mortgage is not for you.

3. Be sure you UNDERSTAND your mortgage. How much is your rate? Can it go up? If so, how much? Can you handle that new payment? Is there a prepayment charge? Can you refinance at any time? Are you required to pay private mortgage insurance (PMI)? Is so, when can you drop the insurance?

4. How will this affect your taxes? Can you change your withholding to get more money each check to help with your monthly payment?

 

[Sherryh]

Oh my gosh, you guys! SO much good information and so many things I hadn't thought about! Thank you!

In other news... Nick proposed to me last night!!!!

 

[Lindsey]

Congrats, Sherry!!!

I agree with the inspector!! Always get an inspector.

 

[Sherryh]

Things are moving along! We got our pre-approval from the bank. We're meeting with the realtor tomorrow to make our offer. Once we all agree on a price we will get the home inspector to come do his thing and go from there. We've been in the house 3 times now and drug Nick's parents along to check everything out and it all looks good to us. The realtor said if we boogie on things we can close by the end of November. I can't wait!

 

[krbshappy71]

Watch for a local parenting class and take it together. That will help bring out any potential issues of parenting together in your new blended family. It helps people to discuss how they feel about children and chores, what the boundaries are on discipline, etc.

It really helps to bring up valuable discussions about both your present children, any children you may have together, and both of your past experiences with your parents. (which unlocks so much information about who they are as a person and the decisions they make)

Personally, I don't like the other person to discipline. Tell me what happened and let me handle it. I like and need the other person to be my sounding board, advice giver, and all around supportive role but not to have to dole out consequences unless the child is directly disobeying them specifically. Discuss what you are comfortable with when it comes to discipline.

Make sure everyone has their own space. Even if just a small area with a comfy floor pillow and a book, its THEIRS. This includes the fiancee' and yourself. Everyone needs some "get away from everyone" space.

Congrats on your new engagement! (and house!)

 

[miss_cas]

Stop at the library and pick up an up-to-date book on purchasing a home. See what websites offer information specific to your state as laws vary and can change the process.

1. Put a requirement for a technical inspection of the property into the contract so you can back out if anything significant is found and you will get your earnest money back. You will pay at least $300 for a professional to look at the place. It's an investment in your fiancial security as you will know how long all the mechanical systems are likely to last, know of any pests on the site, any repairs for anything not up to code and any structural problems you will need to deal with.

2. Check with your local nonprofits for first time homebuyer help. Be selective about which mortgage company you use. IE: I was able to find a large bank that did not require PMI of its low and middle income earners. I also qualified to have my closing costs paid for by a local nonprofit for free if I lived in the house 3 years and completed 100 hours of sweat equity on the property. The Govt Rural Housing office offers very low interest loans on properties that need a little work and are located in little towns or on the edge of the city. HUD, your local city and sometimes nonprofits offer help such as home remodels, weatherization and free paint.

3. Make sure you have an emergency account so you will have enough money to pay for any repairs or expenses that come up in the move. IE: deposits for water service, moving or starting new utility services, repairs that need to be done immediately, a lock smith to change the locks.

4. Have the basement checked for radon. Also, if the house has any peeling paint, deal with this before you move in if you have small children. Eating peeling paint chips can kill little children.

 

[Squidge]

Aw, congrats on the engagement . There's so much great advice here, I'm favouriting this thread for when we finally get round to getting a house!

 

[Sherryh]

Thanks so much, everyone! SO much great advice!

Updates...
We made an offer on our house last week and it was accepted yesterday. Yay! So we now have a signed purchase agreement.
The home inspector will be there tomorrow afternoon to do our inspection. I am going to be there, and Nick's Dad is coming with me since Nick has to work. I even have a sitter for the kids so I can pay attention! lol
The bank has the purchase agreement and our FHA financing is rolling!
We are trying to push for closing by Dec 1 so we don't lose the homestead taxes.

We are working on setting a date for our wedding... which is going to be small and casual.

My kids are both thrilled about every aspect of this!

 

[Sherryh]

Well we had our home inspection. Wow! I definately recommend that to anyone buying a home. I was there to follow him around during the inspection and I learned so much! Not only did he check the condition of everything, he also offered tips on energy saving, maintenance, and lots of other things.

Everything looked great at our house. Only one big flag. The electricity is 60 amp... FHA loans require at least 100 amo service. Sooo I called the electrician and he is getting us an estimate to upgrade it. Then we go back to the seller and negotiate.

In other news... we are getting married on December 18th in a small, private ceremony at our church.

Keep us in your thoughts and prayers!

 

[littleplum]

I read an article somewhere that the new homeowner spends on average $4,000 in the first two months of owning the home on small repairs.

This was me. I spent $4,000 on small stuff like paint, brushes, supplies, new light fixtures, new toilet, new screen door, sheet rock, etc etc. All of the little stuff adds up very quickly so make sure you leave yourself some cash after the closing.

We spent over $10,000 in the first year on repairs to our home. We knew going in that it would need these repairs. We spent about $5,000 on plumbing before moving in, another $4500 on windows, and the rest was things like replacing the bathroom sink, insulation, paint, light fixtures (we put in ceiling fans in all the bedrooms). Our home was only 90 years old.

However, I wouldn't advise anyone to ever purchase a home with someone they aren't married to. Definitely not a boyfriend, or fiance. Not even family. I made that mistake, and it cost me $12,000 and my credit score to get out of it.

 

[Sherryh]

My fiance is purchasing the home... in his name only. We will decide after we're married whether to add my name to the mortgage or not. Its not something either of us are concerned with tho. It is OUR home, no matter what.

Update:
We got the electrical estimate yesterday. Nick is meeting with the realtor this morning to sign an ammended purchase agreement. Then we wait to see if the sellers accept it!