House Buying Questions

[ides]

We are looking into buying our first house within the next six months. We will have the savings for a down payment for the price range we want plus a little extra in the next couple months. We pretty much know the areas we want to look in. Since this is our first time I have some basic questions. Do you need a Realtor? I'm guessing yes, but tell me if I'm wrong. How do you go about finding one you trust? How much house perusing did you do before hiring/working with a Realtor? How far in advance did you get your prequal letter to buying? How many banks did you apply for a loan with or did you go with a loan broker? I'm already stalking houses with zillow - but know I need to start formulating a plan.

Also, has anyone bought a house they were renting? If so how much leverage do you think you have or how much were you willing to compromise on the deal since you were already in the house and knew it's issues? We like the house we are in but I'm not sold on it as we'd have to build a garage and it was a flip so although some things were done well there are quite a few areas where they cut corners (painting over wall paper, etc.) that I would want changed/fixed.

[SoonerTexan]

In the end, I didn't like our realtor and he was the one I did research on and picked after dumping the first, so no advice there. I do not think you have to have a realtor. If you are looking at By Owner properties, I'd rule out any of those before getting one, because then you will be on the hook for the realtor's commission if the seller isn't willing to pay (and if they are selling by owner, they probably aren't). Otherwise, I'd get a realtor to help you through the process, especially as a first time home buyer. In most cases, you will not be responsible for his/her commission.

I got us prequalified as soon as we got serious about buying. It wasn't a hard process and gave us a realistic view at what we could afford. It was hard to know without their property tax and insurance estimate.

I checked rates with two brokers and Chase. The brokers came in equal well under Chase. I went with the broker my boss recommended to me and he was awesome. Really on top of it, responsive, etc. So many things were a PITA, but at least he was not one of them.

I narrowed down the area we wanted to live in well in advance and knew every property on the market. There weren't many--15 in our price range at the most. Actually, finding a house to buy was our real problem! But we bought in the town over from where I spent my high school years and had friends, so I had an idea of what the market was like. We chose it primarily because of the location and resale opportunities.

[oceanchild]

We got a realtor because it was worth it to us to cut down on hassle (and we were buying from afar). I'm still happy with that decision. We were able to get a recommendation from a friend, and he was great.

I think we only applied to one bank, because DH was convinced we would only qualify for a physician mortgage. I have no idea if he was right.

And we looked at houses online for months, but did all our actual visiting in the one week that we were in town for that purpose. Scheduling everything in those first couple days was a definite advantage to having the realtor.

[moonlight]

We had a really crappy agent. Ask around for a agent that people have used and really like. Ours was a big PITA. I really liked our sellers agent and will try to hire him when we sell next year.

* also wanted to add that our crap agent referred us to the worst loan broker on the planet.

[MrsK]

At the risk of pissing off realtors, in most markets, you do not need one to purchase a property. Realtors are not your advocates. The listing broker will be happy to show you the property (and to not have to split a commission with your broker). I do, however, recommend that you hire a lawyer before you sign a contract.

[diggitydot]

I would take realtor recs only from trusted sources. We had a crazy shitty one recc'd to us by someone that I should have known better than to take their advice. We would have been better off using another realtor in town.

[SoonerTexan]

Haha, sounds like everyone has had their fair share of craptastic realtors.

[GreyhoundsRUs]

Our realtor is the wife of one of our more famous attendings. Needless to say, we used her

[SuzySunshine]

We did not like the realtor that we used when we bought for residency, we loved the realtors we used to sell for residency and bought here, both were word of mouth recommendations though I did interview others when we were selling before I settled on one. I agree that you don't necessarily need one but you will need someone to look at the buyers contract if you don't have one. Ask around.

We talked to three different mortgage brokers when we bought this house before we settled on the one that we ended up using who probably saved our ass when the financing almost fell through the day before closing but it was a physician loan with very little down. So I'm no help there, if I had it to do again I'd ask around for a mortgage broker they should be able to get you the best deal.

Good luck!

[Deebs]

We've always bought from a distance, so we pretty much needed a realtor. If we were buying local, I wouldn't necessarily use one.
As far a being pre-qualified, it will give you a better sense of what you can afford, but you will still have to go through everything once you make an offer that you would without pre-qualification. A letter saying you're pre-qualified is worth the paper it's written on. As sellers, we had buyers put in offers with letters when they were "pre-qualified" only to be turned down when it came time to get a mortgage. This isn't to scare you, just to let you know that getting pre-qualified doesn't save on the hassle factor of getting the loan.
We did buy a house that we rented for a year, but it was a very unique situation. We actually lived in the house for a year AFTER putting an offer to purchase on the house. It was a very unique and complex situation. I don't know if I'd buy a house I was renting unless it was the right house, BUT you do have the advantage of knowing the flaws of that house.

[alison]

LOVED our agent. My parents have used her for decades. Her listings are all multi-million dollar homes these days, and ours... Well, our range was within the peanut range for her. . She was faaaannnntastic. She treated us like any other client, and was so wonderful. She was available at all hours of the day and night, and so helpful and patient. She left a symphony concert in the middle of it because she'd heard from the seller's agent with a counter offer. I think if you have a child and are relatively busy, an agent is helpful. She hooked us up with a great local lender, too.

[TulipsAndSunscreen]

I loved our real estate agent when we bought here. He was familiar with the issues that houses in the area typically have and was able to steer us away from potential pitfalls (there are some neighborhoods here that have bad termite damage, etc because of the choices of siding and some issues with the plumbing pipes as well). He was also able to give us accurate estimates of what certain repairs/upgrades would cost if we wanted to do them.

Does Angie's List do realtors?

I would say don't be afraid to interview a couple and see who you like. Also, make sure the one you choose has a focus on the area you're interested in so they know the inventory, the schools, the price ranges, etc.

As for other stuff, we prioritized houses that had new "capital expenditures" (roof, HVAC, etc.) over awesome fancy finishes because we knew we couldn't afford a roof in residency. We also prioritized downstairs layout over huge bedrooms. Houses here seem to have either garages and huge bedrooms (because there's upstairs sq footage to spare) or larger downstairs and no garages (because the footprint of the downstairs can be larger on the lot) - for our family, we prioritized community space for smaller bedrooms. And we wanted all bedrooms clustered together on the same floor because we have a young child. These are all things to consider - not just # of beds and baths.

[GrayMatterWife]

At the risk of pissing off realtors, in most markets, you do not need one to purchase a property. Realtors are not your advocates. The listing broker will be happy to show you the property (and to not have to split a commission with your broker). I do, however, recommend that you hire a lawyer before you sign a contract.

This.

That being said, even though I could have done it myself , I really did not want the hassle. It was an expensive home and I wanted everything done right with no headaches. And I needed distance on the deal. I did not need yet-one-more-thing to be hyper-engaged with. I have enough on my plate. So, I engaged a realtor. It was worth it. Oddly, I suppose, I did not use her at all for determining what what properties I was considering. We already lived in the area. I knew the school district I wanted and I knew the market very well (I'd been watching for 6 months, and there were never more than 50 properties available at any one time). We loved two properties, both which came available about the same time, and were not interested in anything else. So, we engaged her when we were ready to see them, and then were prepared to make an offer on one of them. We took some of her advice re: how to frame the offer and counteroffers. She gave good advice. We got the house on better terms than I thought we would.

A good friend in town recommended her. We liked her immediately and were very happy with her. She was not bubbly. I hate bubbly, and most female realtors I've dealt with have been bubbly. Our seller's realtor in STL (when we sold our condo) was over-the-top bubbly (she could have been Julie Andrew's manic sister), and it drove me nuts. But, darn, I have to admit she did a good job.

The important thing to remember with a realtor--whether buying or selling--is that his interests are not your interests. They say that they are, and they may be bound by some kind of ethical obligation, but the reality is this: whereas a $10,000 difference in price may be a big deal for you, it makes a very marginal difference to him. And, they will often gloss over how substantive a problem with a house may be, or suggest how you could change a problem so that it is no big deal, because they are trying to sell you to close on a property. They make money when you close--the more time of theirs that you take before closing, the less productive you are a client for them. They are highly incentivized to manage you. You are still your best advocate.

I did not engage a lawyer for our purchase, but that is only because I am a lawyer. I represented my husband and me, while the other side was represented by the Seller (a lawyer, too). Plus there was the lawyer for the title company. Come to think of it, it was a heavily lawyered residential deal for a pretty uncomplicated transaction, as these types of transactions go.

I loved my guy from SunTrust that did our loan. LOVED him. He was able to get yet another 10th of a percentage knocked off an already great deal, twelve hours before closing.

[HouseofWool]

I will say that I FLOVE my realtor with all my heart, but she is my best friend's mother and I have known her for 25 years. She would have been so offended if I hadn't used her to purchase.

[ides]

Great info!

We plan to have 20% down and we are keeping the house price range low too so I'm hoping getting a good mortgage will not be so hard. From your feedback I'm thinking we will skip the pre-qual stage & just shop around for a mortgage when we have the down payment money. How long can you hold a mortgage before spending it? Can you apply for a mortgage for a fixed amount then take less of it if you buy a cheaper house?