We bought a house!!! Our first-time home buying story.
Shownotes
We bought a house!! My partner, Oliver, is joining us on the podcast today to talk about our home buying journey as first time home buyers.
This Episode Discusses:
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Buying property with a partner
Applying for a mortgage
Closing costs
Budgeting for buying a home
And other parts of our story!
Podcast Transcript
OUR HOUSE STORY!!!
Hello, and welcome back to the thrive with money podcast. My name is Charlotte, and today we are joined by Oliver, my partner because we just bought a house.
We're going to talk about our whole home buying process. I shared a post or an announcement on Instagram when it happened, and an overwhelming majority of people in my stories said that they would love to hear Oliver come and guest speak on the podcast and talk about our home buying story.
So first you might be wondering, wait hasn't Charlotte said not to buy property or mix finances with someone before getting married or having a cohabitation agreement of some sort in place? Yes, I have. And I still do. It is so important to make sure that whenever you are merging finances with anybody, you want to make sure that you are both legally and financially protected. And for our house situation, basically the house is in Oliver's name. When we get married, I will buy into this property to become an owner.
At that time, we will need to make updates to the deed, the title, the homeowners insurance policy, utility accounts, and depending on what the lender says in this situation, we might need to even refinance the loan.
When we do get married we want to have a prenuptial agreement as well because you know how I feel about adding my name financially to someone without those protections in place.
I also really liked the idea of having a quick and simple exit strategy. Not that I think that I'll need one, but it just makes me feel better after some past negative experiences in a relationship. Also it was just easier to have the title and the mortgage and everything in Oliver's name, because we wanted to take advantage of interest rates before they increased. Since this whole process started, how much has the increased interest rate increased?
Oliver: I think by over a percent.
Charlotte: And we actually just talked to a lawyer recently to figure out like, well, what will we do with the house once we do get married? The lawyer recommended putting it into a revocable living trust so that there's financial and legal protection for both people, if anything happens to either one of us. And then of course we want the prenup as well. How do you feel? Anything that you want to say with all of that so far?
Oliver: No, I think you, I think you got it all, Char. Mainly just capitalize on the market timing to lock in a rate before they increase any further. And then also because you just started your own business and it just made more sense to make sure we had the most favorable terms on our mortgage to just have my name on it.
Charlotte: Yeah. And that's a really important point to talk about to anyone that's thinking about starting their own business and you’re wanting to buy a house. Mortgage brokers want to lend people money that have a steady source of income. That makes sense. And that doesn't mean that a business owner can't buy a house by any means, but you're going to need to prove your self employment work history, and most mortgage brokers will want to see that you've been in business for at least two years and be able to prove that your income is either stable or it's going up. I started Save Live Thrive in August of 2020, and only just went full-time this past November. So like six months ago. And unfortunately I just don't meet the timeline requirements yet, which is fine.
If you are a business owner buying a house, the mortgage broker will likely ask you to prove income stability by bringing some profit and loss statements, balance sheets, personal and business tax returns, and valid employment verification documents, proving that you are self-employed and that you own your business.
For additional context, I know a business owner that started an online business while working as a teacher who made over $400,000 in her first year in business but chose to stay at her teaching job while applying for a mortgage, because even though her business was making so much more money than her income as a teacher, her business wasn't old enough to prove income stability yet because it was so new. . So this is a super important point to talk about. If you're planning to start a business and you're wanting to buy a house, you just want to keep all of that in mind.
Home Buying Story
All right. So now let's get into our home buying story. I don't know how much of this conversation I'm going to edit, but we definitely have different communication styles which is leading to a lot of laughter for us behind the scenes as we've recorded this podcast episode. How about you start with the home buying story and kind of what those first steps looked like for you.
Oliver: Yeah. So as your audience will probably come to realize. I try to speak much more concisely, so my version of the story isn't going to have as many flourishes or embellishments to them, not embellishments. Details. Right. Details. So. I asked a friend who they used as a real estate broker. And then he referred me. And then we met. Set up a time to view houses. Then we viewed houses. Then we saw one. We liked it.
Charlotte: You're going way too quickly. Okay. So. Mortgage broker, you talked to your friend and you got a referral for the mortgage broker that they had worked with. And that was like a really funny first conversation with this mortgage broker. So even though the mortgage and everything was in Oliver's name. I was in the conversation for every single thing that happened throughout the process. When he first talked to the mortgage broker, Oliver had just come off of a period of unemployment and had just started his job at his new company. What did the mortgage broker say when they asked about your situation?
Oliver: As a part of the kind of onboarding process into the mortgage process, they want to get some background information specifically with regards to your finances. So he was asking me about my employment history and how much I made. So when I told them how long I had been unemployed, there was just this silence on the other end of the line, and he says, “noted”. And then after we, we keep going down the sales funnel and he eventually asks about my credit score. And then I told him it, and then it just completely changed the tone of the conversation. And it went from him feeling like this was a hopeless cause to like, this would be a piece of cake. He literally said, “I think you might be my best client o date” and it all really came down to the credit score. And then also the amount of money that could be put down for a down payment. Right. And then he was like, “you're my best client today”.
Charlotte: He was so skeptical, he thought it was just a waste of everyone's time and that this call was going to be awful. And then the dynamic changed very, very quickly. What would you say is one of the biggest things that you learned just from going through the pre-approval process alone? What was the biggest thing that you think stuck out for you as part of the application process?
Oliver: It was just how important credit score was. It seemed like nothing else really mattered as much as long as the credit score was good. Everything else could be worked out.
Charlotte: Yeah. So that's something to think about. If you want to buy a house in the next couple of years, really start focusing on improving your credit score, making sure that you're paying all of your bills on time. Lowering your credit utilization ratio by paying off debts and stuff like that, because your credit score is very, very important. And I also want to take a minute to talk about the difference between a pre-approval and pre-qualification. So if you're pre-qualified, that's basically when the mortgage lender has looked at your financial information and they've let you know that they think that you will qualify for a loan, but you have not really gone forward with any type of loan application process. A pre-approval is basically one step above a pre-qualification. And a pre-approval is basically like this conditional commitment from the lender to loan you money for a mortgage. So they do a harder financial and credit check. And they're really just digging into that information a little bit more to be like, “yes, we will loan you this money” before actually applying for the mortgage, which is when you find the house that you want to buy. So you want to make sure that you really understand the difference between pre-qualify and pre-approve, and then when you're actually applying for that mortgage, our realtor said that in the market we're in today, it's really important to have that pre-approval in hand. Otherwise you're just really not a competitive buyer.
Oscar: Yup.
Charlotte: Okay. So you got pre-approved and then you reached out to a realtor. The realtor that we worked with was amazing. He was literally the best realtor that I feel like we could have asked for. And that came from a referral from a friend. And make sure that you definitely find the time to work with a realtor who is really going to go up to bat for you because I don't think that we would have ended up with the house that we did and the deal that we got if we had worked with somebody else.
Oliver: And honestly, we got, I don't want to say lucky, because I feel like that takes some of the praise away from our realtor, because a big part of what we were able to do so quickly was because of how quickly and responsive our realtor acted. Right now with the market, as crazy as it is, it is being very active and responsive. And communicating to all different parties was a critical differentiator.
Charlotte: Yeah, and we could literally text our realtor and he would respond within a minute. That's not even an exaggeration like that would happen. And if I ever called him, he would pick up right after the first ring on my end, just like immediately answering - reaching out and communicating with all the people that needed to be talked to. And he also really knew how to negotiate while also being respectful and kind of knew when to drive a hard bargain while maintaining relationships with everyone involved.
Oliver: Yeah. Yeah. So a big part of. I mean, in addition to his responsiveness, it was his ability to quickly form relationships with the selling agent. And that, that was important because that gave us information on where we should come in with our offer, and oh, some of the other terms as well. And just to get a sense of how competitive it is because some agents could play hardball and just say, “give us your offer by this day”, and that's it. But we were able to get additional information as well, like how many other bids? Are they cash? What kind of appraisal guarantees were being thrown out? So that all helped us. It helped us inform the way we formed our offers and made sure we didn't overpay or underbid.
Charlotte: Yeah, exactly. So let's talk a little bit about our actual shopping process. One really great thing about our realtor is that he got us out and going and looking at so many different freaking houses. And we actually put in the offer on the house that we are now living in, which actually, as we are filming this, we have like a studio apartment basically set up in our living room because we're undergoing this giant renovation project on this house, we wanted a fixer-upper. Our bedrooms and offices are not ready. The kitchen's not ready. We're just camping out in the living room. Which is kind of fun. But anyways. We saw so many different houses on that first weekend. How many houses do you think that we saw?
Oliver: It was a full day.
Charlotte: Two full days. Yeah. We saw like 20 houses.
Oliver: Yeah, it was a lot. It was tiring. I didn't realize how tired I would be. It's exhausting going to all these houses and really after a while it's like, these houses just blur together and it's hard to even keep them straight, which one? What parts of which house you liked and didn't like,
Charlotte: Yeah. And we were really motivated to find a house as well because our lease was ending in the house that we were renting. And one thing that was like, Really exhausting and just like energetically draining was taking the emotional energy to imagine if you could live in that house and like, think about your life inside of that house. And sometimes we were at open houses or there were other couples or families that were coming through and like they're doing the exact same thing and you're balancing imagining your future life there while also someone else is doing that right next to you and it's a lot to do at one time.
Oliver: Yeah. Yeah. The other thing that caught me off guard was, to that point, the chemistry you have with a house. I've never really thought about, you know, like when you meet a person, there can be chemistry, either you click or you don't click, but like, it's kind of the same thing with a house too, and sometimes it can be hard to say like, why you like or dislike a house, but you just feel it. So you really have to listen to your gut when you go into view these houses.
Charlotte: Yeah. Like there was this one house that we saw and it was like a unicorn house, basically in the area that we live in. It was a tudor style home. It was an L shaped house. I don't know how into houses you are as the listener, but it was a tutor site tudor style home, L shaped house. It basically had like two distinct ish homes inside of it. It had all these different rooms. It was gorgeous on the inside, but the house was so big and disjointed in a way that it didn't feel like a home. That open house was crazy because it was this again, unicorn house in this area. It was priced pretty cheap and there were like 20 different families at that open house when we went. But it just didn't feel warm. It didn't feel cozy. I couldn't see ourselves living there at all.
Oliver: Yeah, it was a weird one.
Charlotte: Yeah, but on paper it looked like, oh my gosh, this house is amazing. Like, we're going to love this, but then that chemistry just was not there.
Oliver: Yeah. It was more of a collection of cool rooms than like one cohesive house that I would want to live in. It had the sauna thing, but it was really far out of the way of where you would normally be in the house. Well, it had a lot of weird things that were nice, but hard to access. That's probably why it was priced the way it was. Yeah.
Charlotte: It didn't feel like a home. But let's talk about sort of the sad or disappointing part of the story. So like day one, we saw 10 different houses. There were some that were pretty solid contenders, but then the last house that we saw of the day was perfect.
Oliver: Yeah, it really checked all the boxes, and even the boxes we didn't know we wanted to check.It was, it was...
Charlotte: A forever home.
Oliver: It had that potential. But it wasn't meant to be.
Charlotte: Yeah. So now let's talk about the market craziness, because offers really are as crazy as people have said that they are, the market really is that wild. So this house, I don't have the exact percentages of like what the over asking price and stuff was that we offered. Do you remember?
Oliver: Yeah, we were, oh, around a little over 10% over asking. Then when we did that, our realtor heard back from the selling agent that it was a strong offer. That it was probably good enough to close.
Charlotte: Yeah. So 10% over the asking price was what we offered. And then we had an appraisal guarantee. I forgot what our appraisal guarantee was, but maybe it was like $15,000 or something like that.
Oliver: There was also a deadline. They said, oh, we're not going to accept any offers after like 8:00 PM or something. And then the next day, apparently they received an offer after that deadline for even more than what we offered.
Charlotte: It was like 15 to 20% over the asking price. And all cash. Which it's like, you are not going to be an all cash offer. And obviously we don't have that kind of money lying around in cash.
Oliver: I think it's kind of dumb. It's like it doesn't actually make that big of a difference either way. Whoever is selling the home gets a big check. The only difference is with an all cash offer. You don't need to worry about getting approved for a mortgage, I guess. Right?
Charlotte: Yeah. But yeah, did not get that house. And that was kind of a bummer.
Oliver: Yeah. I mean, I guess if you're already pre-approved for a mortgage, and getting that mortgage,,
Charlotte: It shouldn't be that much of a hurdle. And I'm sure that things can kind of come up where it's like someone's pre-approved, but then maybe something happens. Maybe they're like buying a new car between pre-approval and mortgage application and the car messes with their credit score. And then they're not approved, actually approved for the mortgage that they were pre-approved for.
So there's a little bit more uncertainty with a mortgage application offer than all cash, but that was disappointing. And then the next day, we got up, we went out on day two of house hunting, and we were feeling a little disappointed. How were you feeling when we kind of were looking at those first couple of houses?
Oliver: I just didn't compare. It's just like the house we put an offer in kind of ruined it for the following houses. Yeah. It was a tough act to follow.
Charlotte: Our intention with buying a house, at first, we wanted to buy a duplex and do some house hacking. I don't love the house hacking term. It's not like my favorite term in the world. But basically we wanted to buy a duplex, live on one side, rent out the other and have that kind of be like our first property, which would be like an investment property. But when we started looking for houses, there were no duplexes on the market, like nothing. So then we kind of decided, okay, well, let's get a single family house that we can see ourselves living in for like 10 years or something like that. But then that's why this house that we made the first offer on was so disappointing because that was a house that we were like, we could die here. We could live here until our very, very old age. So that was a bummer to kind of lose out on that.
Oliver: Yeah.
Charlotte: Okay. Day two. The houses were not the same. We weren't feeling as excited about them. But that day also was kind of wild. The second day was really when we were seeing just these ridiculous wild offers, like why would someone ever even agree to these types of situations for these homes? So there were these like bungalow houses, which bungalows are really cute. I'm not hating on bungalows. But they were bungalows that were built in the 1930s. There were about four houses that day that we were inquiring about what the offer would look like. And the seller's agent told our realtor, like you need to be coming in starting at least 20-25% above asking, waiving all inspections, and giving like a $50,000 appraisal guarantee. Which was just like, absolutely ridiculous.
Oliver: Yeah, that's kind of like Okay, pass on those terms. Because these houses are not worth it, but it's crazy. Because the craziness of this market makes you wonder if you're the crazy one or if it, if the market's the crazy one, because you see. There are these, I don't know how much you can really read into like the cars parked in front of an open house. But there's like these Porsches and BMWs parked in front of these, I don't wanna say crappy little home, but they didn't really match up with the car. And so it's, it's just like, what is going on here? And then they asked for those types of terms and it's just like, it's really, de-motivating honestly right.
Charlotte: That's going to be a hard pass from us. And also with the comment on the Porsche and the BMW. In the Save Live Thrive community. We all know that wealth is oftentimes hidden and that just because someone has a big house or they're driving a really nice car, that doesn't mean that they have the net worth. That kind of meets the image of the cost of that house or car or whatever. because wealth is oftentimes hidden.
But anyways, we did not go forward with any of those houses. And then we kind of went home at 5:00 PM. We were feeling sad. We were feeling dejected. We got home, put on our jammies. And like laid down and started to take a nap. And then the realtor sent us some houses in a different town that we hadn't really been thinking about as much, but they were, like, beautiful. And we were like, let's check them out. And our realtor was like, “put your shoes back on. You're getting back out there!”
Oliver: And that's exactly what we did. That's the other big takeaway is like, you know, you think you want, you know, XYZ neighborhoods. And then you kind of lose focus of all of the other options available to you, kind of tunnel vision on a certain subset and I'm glad our realtor brought those to our attention because, left to our own devices, we never would have looked at them.
Charlotte: Yeah. We would have stayed in the same town/area that we had already been living in. This isn't even that far away from where we used to be living at all. Like it's basically the same distance from all of our friend's houses and stuff like that. But I love the neighborhood that we're living in now. Like this is the most diverse town that I've ever been to. I can say that with confidence. Bless you. What do you think?
Oliver: Yeah, it’s great. I mean, it’s more suburban than it is urban, but with that said, I like it. But yeah, there's a lot of great restaurants out here.
Charlotte: Okay. So that's another moral of the story. We really like the town that we're in now, but if it had just been up to ourselves, we probably wouldn't have looked out here. But our realtor really kind of helped push us out of that comfort zone.. he broadened our scope. He really did.
Okay. So then we saw this house. We really liked it. We made an offer after we saw it and kind of walked around, the offer was accepted at asking price and then we had a five day contingency window when we would like, do all of our inspections and stuff like that. And basically do our due diligence.
Oliver: It wasn't accepted at asking. We offered above asking, like over 5% above.
Charlotte: But then the inspection happened. Right. And when we had first seen this house, there was snow on the ground and that's really important. There was snow on the back deck. And the inspector came in and looked around, the snow had melted by the time the inspection happened and the deck is like, can I say decrepit, is that like hating on our deck too much? It's like.
Oscar: Yeah. I mean, it's as straight as Owen Wilson's nose.
Charlotte: Oh my gosh you can't say that.
Oliver: Okay. It's as straight as something that's crooked.
Charlotte: Oh, my God. Do I leave that in?
Oliver: I don't know. It's your podcast. Worse things have been set on podcasts. Yeah.
Charlotte: Well so the porch was crooked. Also the furnace is older than Oliver.
Oliver: Yeah. Well older than you too.
Charlotte: But you're older than me. Okay, so it's older than you. It's an old furnace, everybody oh, and then also, like other stuff, was kind of broken that we didn't really look at when we were first looking at the house.
Oliver: Basically, we didn't know what we were doing and what to look for. And you can't trust pictures because if you just look at the pictures in the listing, everything's going to look great. It really comes down to seeing things in person. Even things like just feeling how the cabinet drawers pull out and like, that can say a lot about the overall quality of the kitchen.
Charlotte: Yeah. So like one of the drawers is currently nailed into the cabinet because it's broken.
Oliver: The last owner didn't really fix things. Yeah. They treated the symptoms, but not the problem.
Charlotte: They tolerated a lot of stuff like the shower, one of the showers in the bathrooms just does not function at all. This house needs a lot of love, but we wanted to fixer-upper. But basically after the inspection came in, would you like to say what happened after the inspection?
Oliver: Yeah. Came in low. So. We decreased our offer down to basically asking price and then they accepted.
Charlotte: And then from there the next step after that was the appraisal. And we kind of lucked out there as well, because we made a 12,500 appraisal guarantee. Which basically means that whatever the house appraises at, we will -up to asking price-, give $12,500 above what it appraised for. So the house ended up being appraised for less than what the asking price was, which ended up bringing down what we paid for it by like another $2,500. And one thing that we kind of learned from that was we went with like one of these big, giant nationwide mortgage brokers. Well, do you want to kind of speak on that process a little bit?
Oliver: Okay. I don't think what I'm about to say is the same thing that you were about to say, though.
Charlotte: Okay. I'll say this first, we went with a big nationwide mortgage broker and the reason that the house appraised so low is because nationwide mortgage brokers are looking at houses all across the country, as opposed to houses that are in a specific county. Yeah, the house appraised a little bit low. And our realtor actually said that he kind of hates when his clients work with big mortgage broker companies, because they kind of treat it like a factory line. And that's kind of what happened. Do you want to kind of talk about that a little bit?
Oliver: Yeah. I mean, I was going to say it was chill. I didn't care. And honestly, if they appraise low, that helps the buyer, right.
Charlotte: It did help us in the end.
Oliver: So I don't see any issues.
Charlotte: Well, each stage of the mortgage application, we had a different point of contact. We weren't working with one person for the entire time. It would be like we were working with one person, then we would kind of get handed off to the next person. And then at closing, we didn't have the most recent finalized copy of the contract, but it was fine because the lawyer had the most recent copy of the contract. So it was legally binding. But some stuff just kind of got lost in communication a little bit.
Oliver: Yeah. What happened was we changed the closing date. And because of that, our insurance coverage period increased. And that was supposed to increase the amount that we paid because we had more insurance coverage. But. Because of all the different handoff points from the mortgage company. That detail got lost in updating the figures. So they were using the original figures, which were a lower amount. And I brought a check for a higher amount. And so what ended up happening was I gave them the check on that day, but then they sent the check back for the difference. And we ended up just paying for the lower amount, even though we got the larger insurance coverage.
Charlotte: Right. Exactly. So that's something to be aware of I guess. If you opt to use a big mortgage broker, you're probably going to be communicating with more people.
Okay. So now let's talk a little bit about the breakdown of the costs that went into buying this house. Cause I think that's something that a lot of people don't really realize that's there and Oliver is shrugging next to me, but that's okay because I like tracking all of the numbers and I'll read you out what they all were.
Okay. So the first thing is the down payment. That's pretty obvious. Um, we know that that's going to happen. We did not put 20% down. And in fact I'm really glad that we didn't, we only put 5% down and a lot of people will tell you that, like you have to put 20% down if you want to avoid paying for private mortgage insurance, that's something that they teach and the accredited financial counselor certification program, you can read about it. Like every single, “How much money do you need to buy a house blog?” they'll say you have to put down 20%. And also Oliver works in finance too. So like, we both are very financially literate people. That's an important thing. We put down 5%. Here's why: private mortgage insurance is not nearly as expensive as people make it out to be. We were expecting that it was going to be two or $300 a month for PMI. It's $43 a month. And over the course of the loan, Oliver made a financial model in preparation for this podcast episode, over the course of the loan. How much is private mortgage insurance going to cost us total?
Oliver: 4,000 bucks over the course of seven and a half years
Charlotte: $4,000. And then once you've basically paid enough into the house where you've paid that like 20% amount that's when you can get private mortgage insurance removed. But $4,000 was absolutely worth not putting down that full 20% because a 20% down payment would have been way more than $4,000. It would have tied up money that we want to put into renovations, cost of the move and all of that, but then most importantly, our interest rate on this mortgage is a lot lower than the average annual rate of return in the stock market.
Oliver: Yup.
Charlotte: Do you want to kind of talk about that a little bit more?
Oliver: All right. If we look at the cost of the debt , it was like 4.3%, 4.4%. If you assume an average return in the stock market of like 7% or 8%, that means you're making 2% to 3% on top. So because you expect a higher rate of return in the stock market, than the cost of your debt, then as long as that relationship holds true, you’re better off from a financial perspective investing that money in the stock market, instead of paying down the debt.
Charlotte: Granted past performance, is not indicative of future performance. You want to do your own research and ultimately make the decision that works best for you and feels best for you. But those are the three primary reasons that we didn't go forward with a 20% down payment. PMI costs like as much as my gym membership. It's $4,000 total over the entire course of the loan for PMI. Which is less money than would have been necessary if we put down the 20% down payment, we want to have money for renovations. And then also we want to leave as much money invested as possible. So that's the down payment part.
The next cost elements were the inspection. So we had two different inspections come in. We had like the regular inspector, which was $275. And then we also had a pipe inspection, which was $325. And then for the earnest money that was put down and that's basically like your good faith money that after the inspections you give to the sellers to be like, “Hey, I'm really serious about this house. I really want to buy this house”. We put a 2% earnest money payment of the total cost of the house and this earnest money is deducted from the total down payment that you make. So we gave 2% in earnest money, but then that applied to the down payment at the end of everything. So then we, when we got to the closing costs table at our closing appointment, the closing costs were $8,247. And that basically was made up of “services borrowers did not shop for” that's what it says in the paperwork. And that was things like appraisal fees, credit monitoring, a flood determination, loan tax services, et cetera. The title services were about $1,150. The origination fee was 0.25% of the loans total amount. And then there was also other costs and those other costs were taxes and government that was $70. We had to make prepayments on things like interest insurance and property taxes. That was $1,873. And then there was escrow, the escrow payment was $3,498. So in addition to that 5% down payment, we had to bring $8,246 to close. But we had already put 2% of that 5% down payment towards the earnest money, so we only had to bring the remaining 3% of the down payment to close plus those additional $8,246 in closing costs. So I hope that all makes sense, but yeah, closing costs were kind of more money than I thought that they would be.
Oliver: Yeah. Same. I mean, cause people just say closing costs, but then they don't really... Nobody ever says what those are and how much they are. So you just know that they exist, but to see the actual numbers was definitely a surprise.
Charlotte: So if you want to buy a house and you want to kind of be budgeting out what those closing costs might be, they're usually somewhere between 3 to 6% of the price of the home, and they do not include the down payment. So you want to make sure that you're really factoring that into your savings goal and the home buying budget that you're creating and all of that as well.
Another thing that you want to keep in mind is that when you do buy a house, you want to plan to have 1 to 3% of the home's market value set aside for your maintenance, repairs, and renovation costs each year. So that's kind of like your house's emergency fund is like 1 to 3% of the home's value per year that you're setting aside in the sinking fund.
Charlotte: Okay. So to wrap this all up, I did a quick Q&A poll on my stories to see if people had any questions about what the home buying process looks like. So I'm going to ask Oliver those questions. So question number one: What qualities would you say is important to look for in a realtor?
Oliver: I'd say there's two, well, three. Yeah, three. #1 is responsiveness. Just the speed, especially in the current market conditions, is incredibly important. #2, we had touched on this earlier, is the ability to form relationships with the other realtor. Because that really provides you with an edge on informing your offers. And then #3 it is to just understand where the different thresholds are. Like what kind of offer is going to be viewed as disrespectful or, you know, based on what we know about the seller, do they care more about the appraisal guarantee? Do they care more about, you know, the actual offer itself? Where the limits are. So I would say those are the three.
Charlotte: They need to know how to play the game.
What were you surprised by with this whole home buying process?
Oliver: How emotional and exhausting it was. And from the emotional front, you have to both be very in tune with how you feel walking through the home and understanding how that potential home makes you feel, but then also to not get blinded by your emotions. I think we were a little bit when walking through the homes and just saying, oh, that's okay. Yeah, no worries. Just looking at all of these things, but then once you move in, you're like, oh, this is actually pretty annoying, that this thing is like that. So. Yeah. You need to have a balanced perspective.
Charlotte: Yeah. This is going to kind of lead into my next question. So I'll ask the question first. What would you do differently? If you could go back.
Oliver: Well, I would keep an eye out for different things. One is, I think I would maybe take some better notes of each house, just so I could keep them straight after the fact. Cause walking through you think you're gonna get a good idea of it, but then, three days later, it's like I don't actually remember that much from the house. So one is to take better notes #2 is testing out things to see if they really work or not. Cause that's the thing that you can't really get from the pictures. And so, you know, when you're actually in the home, that's the time to really get a sense of that.
Charlotte: Yeah. Like, and your inspection is going to bring that all up as well. But yeah, there's a lot of broken stuff in this house. Like the fireplace is broken. One of the bathrooms is virtually inoperable. The kitchen needs to be renovated, but we knew that we wanted a house that needed a kitchen renovation and stuff like that. But. You want to keep an eye out and have a really objective perspective of how much of this stuff needs to get fixed. Granted, we wanted a fixer upper. So we're kind of getting all of the things that we asked for, but we do have to live in this house until we get it finished. So that's important to keep in mind too. Yup. Yup. Okay. And finally, what do you wish that you knew earlier about the home buying process?
Oliver: I wish I knew PMI wasn't that big of a deal. That's one. And the other is, well, I don't know. That's the only one that comes to mind right now is that like, PMI is always teed up as some, like, if you're paying PMI, you're making a mistake. But. That's that's not necessarily true. It's not really even that big of a deal. And it could be a mistake to not pay PMI. Or to pay PMI. You mean no to not pay? Oh yeah. Yeah.
Charlotte: And so you really want to look at your numbers, take a full stock of your financial situation. I think that it could totally be a different situation depending on the area of the country that you live in too. Like, I can only, we can only speak for our situation where we live specifically, someone living in like New York or LA could be much different with like the PMI situation out there, but you really want to take a look at the numbers and make an informed decision that makes sense for you and your finances and your financial situation.
Yup. Yup.
Charlotte: Any final thoughts that you want to add?
Oliver: No.
Charlotte: We had to start recording like four different times because we both just started laughing. Because we've never done this before.
Oliver: Yeah, no, but this was fun.
Charlotte: Cool. Well, that is our home buying process. We are going to make a DIY account chronicling our journey. Should we just like, come up with a name right now? We haven't settled on a name yet.
Oliver: No, I don't want to commit to a name like this.
Charlotte: Okay. Well, follow me on Instagram. And as soon as we decide what our DIY account name is going to be, we will create the account and share it and just chronicle our DIY journey. But yeah, thanks were turning in! Let me know, send me a message on Instagram if you have any questions about what this process looked like, it was so much fun having Oliver on the podcast! See you all next week! Bye!
A quick disclaimer that the content information provided on this podcast is for educational purposes only and does not constitute professional financial, legal, investment, real estate, or tax advice for recommendations on your specific financial situation, you must additionally seek the services of an appropriate licensed legal, accounting, tax, insurance, investment, or real estate professional.
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Disclaimer: The content and information provided on this podcast is for educational purposes only and does not constitute professional financial, legal, investment, real estate, or tax advice. For recommendations on your specific financial situation, you must additionally seek the services of an appropriate licensed legal, accounting, tax, real estate, or investment professional.
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