Where did the past year go? I realized
haven't written much since August (other than my Peru trip), because I had a lot going on and unfortunately no time to write about it. I do have some exciting
news on what has been going on though......
I
bought a house!
I guess that officially makes me an
adult! It's in Manassas, VA and is just gorgeous if I do say so
myself!
Why a house:
It all started knowing that my lease at
my apartment would be up in February. I needed to decide if I was
going to continue to lease there, or elsewhere, or if I'm going to be
in the area longer. Unfortunately in this area, the rent is outrageous and townhouses cost just about as much as
a house, but are less maintenance and less space. So my thought was if
I'm going to spend the same amount, if not less, then I might as well
get the best value for my money, so a house it is! I think I ended up
looking at about 30 houses in person, and several hundred online. The
house search apps such as Zillow and Redfin were helpful in filtering
out what I was looking for in my price range. I was told that I would
pretty much know right away when I found the right house, and crazy
enough I did. When I walked into the house, it was everything I was
looking for with minimal work that needed to be done to it! So begin
the insane process of buying a house!
The Process:
Now I am by no means an expert, or even
intermediate in knowing everything that goes into buying a house. I
was basically learning as I went. You probably should do some
research beforehand to better understand what exactly you will be
getting yourself into along the way. However, here is a real quick
guide to what I went through.
Determine how much house you can
afford
-The typical recommendation is
to look for a house that costs no more than 25 to 30% of your annual take home income, especially if you plan to make a 20% down payment.
There are calculators on the internet that you can use, or of course,
ask your bank. If you're like me, you want to pay the least amount as
possible for the most house without having to live paycheck to
paycheck. I made sure that I wasn't going to pay for a house that was
at the top of the range of what I could afford, I opted to use the
low end of the range, and got lucky enough to find a house in that
price range. Just because you CAN afford it, doesn't be you should.
Get Pre-qualified
-I was confused about the differences
in prequalified and preapproved. Prequalified is when you provide
basic financial information to your bank and they give you a
statement saying how much house you can afford. This is similar to
the above statement, but it puts the amount you can afford in writing
so that you can give it to the seller when you put an offer on the
house you want. Preapproved is when you provide other financial
documents, such as W-2 forms, paycheck stubs, and bank statements, so
your lender can verify your credit and financial status.
Real Estate Agent
-Real estate agents are incredibly
helpful in the house buying process. They are able to negotiate with
the seller's agent and fully understand the house buying process in
order to help walk you through it. What's nice is that, it doesn't
cost you anything to get a real estate agent, they are typically paid
from the commission paid by the seller of the house. I worked with
Nadia Dellawar from Samson Properties who was recommended to me by my
bank. She was very patient and explained all the details I knew
nothing about.
Shop for your home
-I mostly used the Redfin app to help
with my house search. I was able to apply filters such as price
range, how many bedrooms and bathrooms, minimum and maximum square
footage, parking options, distance to work, and any other
"must-haves". Deciding what your "deal-breakers"
vs "wants" are in a home, will help narrow down your
search. Be sure to look at the neighborhoods as well as just
the house, and take your time! Time of the year is important as well.
Winter months don't tend to have as many buyers since no one wants to
move when there is snow on the ground, or in the middle of a school
year. Because my apartment lease was up in February, this was the
best/only time to search. There tended to be lower priced homes
especially if the seller's were desperate.
Make an offer
-When I found the house I liked, I put
an offer in right away. It had only been on the market for a few
days, but I knew because of the amazing condition it was in, it was
going to go fast, so I didn't want to wait. The seller tried to
negotiate price with me, but that's where my real estate agent was
helpful, she insisted that the seller wouldn't go wrong if they
accepted my offer. That night my agent worked up a contract to
negotiate closing date and costs. A day or two later, they accepted!
I was thrilled but also nervous because this process was about to go
very fast.
Home inspection
-One of the first steps after accepting
an offer, is ordering a home inspection because the sale of the house
is contingent on the condition of the house. The inspector checks
structural damage as well as anything that may need fixing. This
gives you the chance to renegotiate your offer or withdraw it without
penalty if there is significant damage. I got extremely lucky, that
the sellers of my house kept the house in such great shape, that my
inspector barely found anything wrong with it.
Get a loan
-There is a wide variety of lenders out
there and every home buyer has their own priorities when choosing a
mortgage. My priority was getting the cheapest interest rate. You can
search different lenders and their rates on the internet. So choose a
company that works best with what you are looking for.
Home Appraisal
-Lenders will arrange for an appraiser
to give you an estimate of the house you are purchasing in order to
determine the value of the home. Basically, it's letting you and your
lender know if you are paying a fair price for your home. Here is
another chance to renegotiate your offer if the value is much less
than what the seller is selling the house for. My lender opted not to
do the appraisal because they trusted the value was fair.
Home Insurance
-Your lender is going to want you to purchase home insurance in case something happens to the house, you and your lender are covered. This is also something you will need to shop around for as there are many companies out there. Also look if the insurance company will bundle your home and auto in order to save some money.
Closing
-A few weeks later, the closing meeting
was set up in order to go through all the home owner paperwork. I
couldn't even tell you how many pages I signed, but I felt like I was
signing my life away. I actually ended up crying at my closing when
my real estate agent handed me the keys.....I think I was just
relived the process was finally done!
Work in Progress:
I wanted to paint and deep clean the
carpets before officially moving in, so recently I finished doing those. I’m also slowly moving more boxes over there whenever I get
a chance and the fur tire will be moved in this week. So next year will start off in a new house!
