House Poor

I’m closing on my house next week. My very first house. The one I’ve dreamed about for 20 years now. The first house that I will be solely financially responsible for. The first house in which I’ll get to make all the decorating choices – for better or worse. Oh em gee!!!

After what feels like the longest process of all time, I’m finally starting to get excited. I walked through the house for the first time on November 21, and made my offer shortly thereafter. It might have been November 25? (It’s crazy that I’ve already forgotten the details!) We were worried that the seller might not respond to my offer before Thanksgiving, but she did, and on Thanksgiving day, I made the announcement to my extended family that I was under contract. I had my home inspection on December 3, and then waited a long time to hear back from the seller. Finally, she decided that she would fix all the items I requested, and they were all addressed by this past Tuesday, January 21. (Hopefully. I’ll see for sure during my final walk-through next week.)

Now, nearly two whole months after making my offer, the loose ends are being tied up and I’m preparing to close. At which point all my hard-earned money will vanish from my bank account, and I’ll start to wonder if it’s worth it. Kidding. Kind of.

There are SO MANY little details in my head: things like inspection items that I didn’t ask to be fixed and I’ll want to follow-up on, the major purchases I need to make in order to have the bare minimum required for living (this will be the first time I’ve ever lived totally on my own as an adult – I need to buy my first silverware set!), and then things like getting all my utilities set up and paid on time each month. Plus, changing over my address, ordering new checks, getting familiar with a new oven/thermostat/bathroom/routine, and on and on.

I’ve been stalking craigslist and pinning like a madwoman to my House Inspiration board on Pinterest. I have so many ideas! I just need to prioritize and save money over time. I dropped $813.92 on a brand-new washer and dryer this past Sunday, which will be delivered and installed once the house is legally mine. After that, I plan to have a plumber take a look at replacing my Quest piping and my original-to-the-house hot water heater. THEN, I should be able to move on to the frivolous things, like non-essential furniture and lots of accessories. 

I’m hopeful that my excitement, the process, and this whole new adventure will inspire my return to blogging more regularly. I’ll certainly have things to write about!

Under Contract

I absolutely haven’t felt like blogging lately. I just haven’t had it in me.

But! I am under contract on a townhouse. It certainly isn’t without its trials: my inspection was on December 3rd, and I still (13 days later) haven’t heard back from the seller regarding the items I asked her to fix — although legally she was only supposed to have 5 days to respond.

Throughout the entire process this go-round, I’ve been waiting for the excitement to set in, but it hasn’t so far. I’m hoping that once I’ve cleared the inspection hurdle and secured my loan, I’ll get more excited. Then maybe I’ll have more to write about, too. But for now, that’s all.

Purchasing My First Home: The Offer

When we left off, I had decided (after 3 months) that my heart was set on the foreclosure. Another timeline seems to be the best way to capture everything that happened after that.

Monday, June 24: First thing Monday morning, I called my Realtor and told her that the foreclosure was the one, and I wanted to make an offer. She told me that she wasn’t home at the moment, and that she’d call me back once she got home to get things started. By about 4pm, when I still hadn’t heard anything from her, I called her back. She was a little snappy with me, saying “I’m still out with this client! I’ll call you when I get home,” so I went back to work (I was put off by the sass, because she hadn’t mentioned that she was with a client the first time we talked). At this point, I was just afraid someone else would make an offer, since the house had been on the market since April!

Tuesday, June 25: My Realtor started the long and arduous process of actually writing up my offer. She recommended that we go in at $10,000 below the list price, and see how the bank would counter. I had initially thought I’d go for about $5,000 below the list price (knowing that when you’re working with a bank-owned property you don’t have a lot of wiggle room), but I was willing to take her professional advice.

Fannie Mae properties (I’ve now learned) come with their own particular contracts, which are long and complicated, and can only be submitted electronically through an online portal. On Tuesday night, I called to check in with my Realtor on the status of my offer, and she told me that she had just gotten off the phone with a technical support person, because the portal for submitting the contract had crashed her computer three times. She told me that she was going to “make supper, and then get back to working on it.” I was annoyed, but still hopeful and excited.

Thursday, June 27: After lots of technical difficulties, my Realtor finally mastered the online system, and I finally got a copy of my contract to review before we submitted my offer. A Virginia real estate contract is 9 pages long, plus a 2-page home inspection addendum. There’s also a 2-page Virginia Residential Property Disclosure Act. On top of that, the Fannie Mae contract was 13 pages of dense legal language, plus 2 more pages of addendum. I reviewed it with my dad, who commented that it was basically a list of 1,000 ways that the bank could wriggle out of the process if they needed to. There were lots of pieces of the contract that I didn’t understand, so I covered it with sticky notes to mark my questions to review with my Realtor the next day.

Friday, June 28: I called my Realtor with my list of questions, and she did a good job of answering most of them. I was excited and felt good about making my offer. My realtor called the listing agent (who happens to be a friend of hers–Charlottesville is a small enough town), who told her that we shouldn’t make our offer quite yet, because she had just heard from the bank, and thought they were likely about to lower their price. Since they had lowered the price by $10,000 after about 30 days on the market and after the first offer had fallen through, she thought it would probably come down by another $10,000 since another 30 days had passed, but she didn’t know quite when it would happen.

[A note: The listing agent told us that it was likely that if I made my $10,000-below-list-price offer before the bank dropped their price, they would counter back at full price, because they don’t want to lose any more money. So by waiting for the price to drop to make my offer, the maximum amount they could counter at would be lower. Make sense?]

I decided to hold off on making my offer until the price had dropped, because more money in my pocket is a good thing! The listing agent assured us that she would call us the second the price went down. (I hope this wasn’t a violation of any sort of Realtor code of ethics or anything, but I think it’s an important enough part of the story that I wanted to include it. I hope no one who matters enough ever reads this and penalizes the listing agent!)

Saturday, June 29: P and I headed to Blacksburg to watch my college roommate get married. Aren’t we cute?

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Sunday, June 30: I told my Realtor that I’d decided that I’d wait until the following Monday for the price to drop, and if it hadn’t yet, I’d make an offer at the current price.

Monday, July 1-Thursday, July 4: I called my Realtor a few times a day, anxious to know whether she’d heard anything from the listing agent. No news, but the listing agent assured us that the price was going to be lowered. Fannie Mae is just slow to move, I guess.

Friday, July 5: The price came down by $9,100, and I met my Realtor at her office at lunchtime to sign all the papers, give her an earnest money check for 1% of the total purchase price, and let the waiting begin. I was annoyed when I noticed that she hadn’t actually changed any of the paperwork from when we had initially written up the offer–it still had our original offer price! She fed a version of the same logic back to me that the listing agent had offered: since the price had been dropped, the bank was likely to counter at their full list price no matter what. I silently complied, although I really thought that this was just a sign of laziness on her part. Since we didn’t get the offer in until Friday afternoon, I knew I’d be waiting until at least Monday to hear anything back from the bank, and I headed into the weekend excited.

Saturday, July 6: My dad, my sister, P, and I went tubing on the Pamunkey River–an annual tradition hosted by one of my dad’s friends on his family farm. We had a good time on a beautiful day, although I got a serious sunburn that still hasn’t healed (8 days later).

2013-07-06 17.03.58

Monday, July 8: I didn’t hear anything all day Monday, so Monday night I called my Realtor. She said that she had just gotten off the phone with the listing agent, and that the bank had countered to our offer. They countered with a price $500 higher, and agreed to the closing costs we had asked for. I delightfully said yes! (At this point during a normal home-buying process, I would have been “under contract.” But I learned that with Fannie Mae, there’s another step: they have to approve my acceptance of their counter-offer, and they can take as much time as they want, in hopes that another offer will come along, and they can pit the buyers against each other in a bidding war. I hoped very much that this wouldn’t happen. I just wanted it to be over with!)

Tuesday, July 9: I didn’t hear anything from my Realtor all day, but I had several phone calls with my mortgage originator about the details of my financing. She told me at one point that she had read over the contract, and thought there were things in it that weren’t “in my best interest,” and that I should ask my Realtor about. (In her opinion, these were things that my Realtor should have noticed and asked about, or tried to change.)

Every hour of every day during the week of July 8-12, I vacillated between feeling ecstatic and horribly frustrated. Every time I called my Realtor with questions, she made me feel belittled and like a nusiance. Talking to my lender–the person who would be helping me give away my precious life’s savings–was ironically more calming to me, because she always took the time to answer my questions, no matter how stupid, and to walk me through all the scenarios and loan options.

Wednesday, July 10: My Realtor called at 9:30pm to say that we had a ratified contract, and she emailed me a copy. I was out at dinner for Restaurant Week (with 3 ladies from the Virginia Bloggers!), and I missed the call. I got the email when I got home. I was under contract!

Earlier that afternoon, my Realtor had gotten a copy of the inspection report from the first offer on the house, and sent it to me, so I could decide whether to use it or to pay to have my own done. I didn’t have time to look at it that day.

Thursday, July 11: I woke up, got ready for work, and sat down to scan the inspection report. I opened the email attachment, and it was 75 pages long. As I started reading, my heart sank. We had been told all along that the house “needs a new roof,” which is why the first potential buyer had walked away. I had estimated that a new roof would run me about $5-8,000, which, with a $19,100 price cut on the house (which put it almost $20,000 below assessment), I could easily afford.

But each page of the inspection report brought something new to be fixed. Three bad windows that were likely rotten through the walls. A new sliding door and all the trim. Two new skylights. Replacing some siding and trim work. A new front door. Settled and unsafe cracked concrete on the front walk. Two destructive trees on the property that were rubbing against the roof. Mold under the basement stairs. Leaky kitchen and master bathroom sinks. A toilet tank that wouldn’t fill. A 13-year old air conditioning unit. And the real cherry on top: photos of the roof from inside the attic where the inspector had highlighted the sunlight coming through the cracks. Contrary to what we’d assumed all along, it wasn’t just that this house needed the shingles replaced: even the plywood underlayment and the joists in the attic would need to be replaced. I should also mention that the first inspection was done on April 30, and it has rained nearly every day for the past month. It’s rained something like 12 inches in the last month. And every time it rains, water pours into the attic of my house. I wanted to cry. But instead, I headed to work.

That night, again, I went over it all with my dad. He told me that the biggest issues were the roof work and the mold under the stairs. Everything else could be dealt with. He calmed me down and helped me figure out how to go about starting to get some estimates and setting up inspections.

But then he asked me how much the house was assessed for. When we started to do the math, we realized that the costs of the repairs required just to make the house liveable (as in, nothing cosmetic) would be closer to $20,000 than the $5-8,000 we had originally estimated. And I don’t have an extra $20,000 just laying around. I was already feeling uneasy about my monthly mortgage payments because interest rates have gone from the 3% range to the 5% range in the past 4 weeks, but on top of everything else, my dream of buying my first house had actually taken a turn toward a nightmare. The fuzzy feelings I associated with the house were fading fast.

Friday, July 12: I tried to maintain a positive outlook. I headed to work prepared to make some phone calls to get some actual estimates on getting the required structural work done, knowing that I’d have to live in the house for a while and save up the money I’d need to do any cosmetic work. But I couldn’t bring myself to make a single call. I knew that I’d crossed a threshold, and the house wasn’t my dream anymore. It had turned into a money pit, and I wanted to get out.

Saturday, July 13 (yesterday): I was nervous about how my Realtor would react, so I met with my dad and my grandma (remember, I’ve only been using this Realtor because she’s a friend of my grandma’s) to talk everything through one last time. My grandma, a former Realtor herself, was outraged when she heard about the extent of the damage reported in the inspection. According to her, all of that should have been disclosed in the listing, according to Virginia law. She told me that I needed to call my Realtor and tell her I wanted out of the contract right away. I was afraid that my Realtor would be mad, because she tends to get moody, and there have been tiffs between her and my grandma over my family’s real estate dealings in the past. But my grandma assured me that in this case, if her friend were to get upset with me, it wasn’t a friendship worth having. (I realize how silly all this sounds as I write it, but it’s just another of the many dramas that have been involved in this process. For example: my dad sold his house in early 2012, and my Realtor didn’t speak to my grandma for months because my dad ended up using a different agent to list his house. My dad recently bought a new house that was for sale by owner, after having my Realtor show him a few houses, and my Realtor was mad about that, too.)

I had been dreading making this phone call for over 24 hours, and when I did, she didn’t even answer. I had to leave a voice mail and in 60 seconds, try to explain that I just couldn’t afford the extent of work that has to be done to the house, thank her for all her time, and tell her that I’m still optimistic about continuing my search. She called me back several hours later and all she said was “I’m out of town today. I’ll send you a release of contract form tomorrow.” She didn’t ask me any questions or tell me that it was okay.

July 14 (that’s today): My Realtor sent me a Release of Contract form to sign electronically. I filled it out and sent it back to her (I hope–I have no idea how to use the system I had to log in to), and I haven’t heard anything since.

Right this moment: I’m hoping that my Realtor will get my form to the bank tomorrow, if she hasn’t already. I’m dreading having to call her to follow up about it, because I’m afraid of more belittling and complaining. I’m also dreading having to call my mortgage lender to tell her that I backed out. I just feel like a failure, although I know that contracts fall through quite often, and that the math all says that this wasn’t meant to be.

After all this, I’m feeling defeated. I’ve been on an emotional roller coaster for about three weeks now, and I know I’ll have to board it again when another house comes along. At the same time, there hasn’t been a single house that’s given me “that feeling” since this one did, all the way back in April. I’m still checking the MLS every day, and there just isn’t anything wonderful in my price range. Plus, mortgage rates have hit a new high.

I’m a little worried about what will happen next. I’m afraid to call my Realtor and tell her that I want to see another house, as I’m afraid she’ll say something snarky about having to take me. I’m afraid I won’t find another house I liked as much as this one. I’m afraid my life’s savings aren’t enough money in this market! I’m just weary of the whole process now, I guess.

I don’t know what the next installment of this series will be, or when I’ll be writing it. I have some photos of the house, but I don’t know if it’s even right to post them now. Does anyone have any opinions or advice? I’d love to hear it!

Purchasing My First Home: The Search

I’ve mentioned before that I’ve been in the habit of stalking the Charlottesville MLS for years now. I’ve been dreaming of buying a house since forever, my mom and grandma both used to be Realtors, and I’ve been watching HGTV since before it was trendy to do so (so like, the early 2000s?). Looking at houses is one of my favorite pastimes.

I don’t know whether anyone will be interested in this “Purchasing My First Home” series besides me, but I want to capture as much of it as I can, for posterity, if nothing else.

A timeline seems like a good structure for this particular post.

May 2010: I graduated from Virginia Tech. (Where I began reading design blogs and followed the Blacksburg real estate market somewhat loosely. There were a few times during college where I toyed with the idea of buying an apartment there as an investment property, with help from my dad or grandma. Thankfully, this didn’t happen. It’d be a nightmare to manage a student rental from 2.5 hours away.)

May 2011: I graduated from UVA. (Where I was reading several design blogs daily and keeping a close eye on the Charlottesville real estate market.)

July 2011: I started my first grown-up job.

Early Spring – Early Summer, 2012: I found a condo in an area I was somewhat familiar with (due to a friend living there), which was listed for noticeably less than condos in that development tended to be. I got in touch with my now-Realtor, who is a friend of my grandma. I went through the mortgage prequalification process, and started to learn about how much house I could truly afford (I was surprised to find that it was more than I thought). I learned about things like interest rates, how hard it is to get financing for most condos (there are only about 6 developments in Charlottesville for which you can get a traditional loan), PMI (that’s private mortgage insurance, which you have to pay if you put less than 20% down on a home purchase), and the actual dollar amounts involved in closing on a home. I ended up never actually going to see the condo, since I found out that no one would finance a loan in that development!

Late Summer – Early Fall, 2012: With an eye on the MLS daily, I went to see a handful of properties, but never saw anything that I loved. I don’t think I ever looked at any single-family homes (wait: there was one that had been nearly completely gutted and that would have needed a TON of work), and the townhouses I saw usually came with seriously high monthly HOA fees. That reality scared me a little, and I decided I wanted to give my down payment a chance to grow a bit.

November 2012: My then-company laid off 25% of its employees (me not included), and, though I had been applying and interviewing for other jobs for several months at that point, I seriously ramped up my efforts. I started at my current job the Monday after Thanksgiving. I worried that this would affect my ability to qualify for a loan, as most lenders like to see a steady job history, and are hesitant to give loans to what my dad calls “job-hoppers.” (I’ve since learned that they look for continuity in job history, so, thankfully, since I’ve retained the same job title, I’m good to go.) I carried on stalking the MLS daily.

This is where my dates get a little blurry, because I’ve realized that I didn’t always put house viewings on my calendar. (I wish I had!)

January 24, 2013: There was a snow storm this day, but I was determined to see a townhouse that had just come on the market. It had had significant improvements done, and was in perfect, move-in condition. It was also quite a bit over my comfortable spending limit. I would have loved to live there, but in the end, I’m glad I didn’t put in an offer. In hindsight, it was the stereotypical “best house in the neighborhood,” so there wouldn’t have been room for much value increase. I should also mention here that at this point in my search, interest rates were L-O-W. Like, close to 3%. That, at least, would have been on my side. 

[I think I probably saw one or two other properties in the next few months, also in the same general area of town as the previous townhouse. This is the point in my search where I think I zeroed in on exactly where I wanted to live, and I did a good job of sticking with that from here on out.]

April 18: During my lunch break this day, I met my Realtor to see a foreclosure in the area I liked (hint: this would become “the one;” I just didn’t know it yet), and a much newer townhouse in a newer development on the opposite side of town. I liked the foreclosure. I hated the new construction, even though it was bigger, newer, and more modern. This is where I realized I didn’t want an open-concept, new-construction home. I’m still surprised by the realizations I’ve had throughout the process.

April 21: I continued to think about the foreclosure for several days, and on the following Sunday, I took my dad back to look at it. I wanted his impartial judgement, which I thought would see past the lust that had started to grow in my eyes. He liked it, too. (YES!!!) However, my Realtor tried her darndest to steer me away from it, as she’d never dealt with a Fannie Mae-owned property before. (I mentioned that she’s a friend of my grandma’s, which, I’ve learned, means that she’s a bit old school. I’ll leave it at that.)

sometime soon after that: The foreclosure went under contract. WOMP, WOMP. I had waited too long, and someone else had snatched it up.

May 20: I saw a stinky, old, gross townhouse in an established development that I’d still really like to live in. But the place was built in the ’70s, and hadn’t been touched since. (Many other units there have been renovated and are very nice. I also really love the location.) It probably wasn’t as gross as it is now in my memory, but I think at this point I had become attached to the foreclosure, and was determined to see only bad things. This house would have needed a lot of work, and I just didn’t feel the connection with it that would have been required to nurse it back to health. I left and never looked back. (Also, the HOA fees at this place are like $215 a month, which is insane!)

[Now’s when I should mention that sometime between mid-May and June 22, I had learned that the offer on the foreclosure had fallen through, because the inspection revealed that it would need an entire new roof. The purchaser countered to Fannie Mae for a lower price (or perhaps for them to do the work?), and Fannie Mae said “aw, hell no!” So it came back on the market, with a $10,000 lower price, thanks to the results of the home inspection.]

June 22: I went to see an older townhouse way across town (actually, in the same general vicinity as the condo from Summer 2012). I really liked the layout and thought it was in pretty decent shape considering its age. It would have been immediately livable, although somewhat dated in the kitchen and bathrooms. But I questioned the neighborhood: the rest of the units attached to this one seemed well-maintained, but the row of units next door were definitely sketchy. One had “PRIVATE PROPERTY” signs (yes, two–one upstairs, one downstairs) hanging in the windows, while another had tons of crap piled up in the tiny front yard. Plus, there was a paint contractor’s van parked in the cul-de-sac, on which the license plate tags had expired over a year ago. I took those all to be bad signs, and decided to drive by to scope out the ‘hood at various times during the weekend.

June 24: I thought about this townhouse all weekend, and every time, I was comparing it in my head to the foreclosure. June 24 was a Monday. That morning, I called my Realtor and told her that I didn’t want to make an offer on the house we had just seen, but rather, the foreclosure that we hadn’t seen since April. Then the real process began.

If you just guessed that the next part of this series will be entitled “Purchasing My First Home: The Offer,” you’d be correct. This is where it starts to get really good. Stick around! 

Twitching

My right eyelid has been twitching since yesterday morning. According to Google, this means that I’m either fatigued or stressed. I couldn’t think of anything that I’m stressed about, but then I remembered that, oh yeah, I’m kind of in the middle of buying a house. (!!!)

I have a lot to write about surrounding this process, but for certain reasons, I’m still not quite ready to reveal anything.

Until a few more things fall into place, you can find me fuming over the incessant spasms in my eyelid. This is probably the most frustrating ailment I’ve ever had.

Purchasing My First Home: The Series

On Friday afternoon, I made an offer on a house. My very first house. The one I’ve been dreaming about since I could walk. Buying a house has been my biggest life goal since I finished grad school. I’ve pinched my pennies and stalked the MLS daily for over two years now. (And even longer than that, as I was doing it even while I was in college and grad school and had no pennies to pinch.)

I don’t want to jinx it, so I don’t want to spill too many details quite yet.

As a teaser, I’ll tell you that it’s one of these two*:

This one?

346 westfield

OR…This one?

150 scarborough*Note: these floorplans were drawn by me with Microsoft Paint, and are therefore highly inaccurate!

I’ve been sending out good thoughts and hoping for the best, and I’ll continue to do so until I hear something back from the seller! Happy weekend, all!

High Five For Friday!

H54Fbutton-1_zpsa7aaa665I’m linking up with Lauren for High Five For Friday for my first time ever, because this has been a pretty fantastic week!

1. P came to visit over the weekend, and on Saturday we visited Wisdom Oak Winery for the first time.

2. On Sunday, we went to the driving range with my dad and my sister, and P taught me how to hit a golf ball. As I progressed, I went from consistently hitting it about 20 yards to consistently hitting it about 60! Augusta, here I come. (Later on Sunday, I ran a sub-9:00 mile!)

3. I’ve been working on putting in an offer on a house all week. I thought I would officially make an offer today, but it’s on hold (just for now). I hope to be able to post in more detail on that soon!

4. I started reading a new book (finally!), and I’m really enjoying it so far. (It’s Middlesex by Jeffrey Eugenides, and if I stay on track, you should see a book review here in about, oh, 5 months?)

middlesex

5. My sister is pet-sitting for her BFF’s parents’ dogs, and tonight I got to accomplish a bucket list item: I took their Great Dane for a walk!!!

2013-06-28 19.45.50Is Sadie not the coolest girl ever?

2013-06-28 19.51.44We solidified our relationship with a BFF Selfie.

So that’s my 5 highlights from the past week! And tomorrow, I head to Blacksburg for the wedding of my very first friend in college. We met at freshman orientation, and now she’s getting married. Time flies…