(Closed) Pre-Qualified for Mortgage…any advice before I go shopping?

posted 8 years ago in Home
Post # 3
Hostess
18643 posts
Honey Beekeeper
  • Wedding: June 2009

I would not go for foreclosures for your first home.  They are a mess to deal with and you usually have to fix up problems on the inside that the old owners left.  Try to visualize homes with your stuff, I had a hard time at first getting over the weird wallpaper and paint colors.

Post # 4
Member
3041 posts
Sugar bee
  • Wedding: May 2010

DON’T get a house where your payments would be at the top of your loan. You want your house payments to be around 30% of your income. I was qualified for a loan that would be 75% of my income… crazy right? How would I pay for food?!

Make a list of “must have” & “must NOT have”. If a house is painted crazy colors, you can ignore that because you can paint over it (like missASB said).

Foreclosures depend… usually they’ve been vacant for awhile & aren’t taken care of. So most of them are fixer-uppers. If you know how to do repairs & don’t mind having to do remodels or something like that, you could get an amazing deal on a house.

Stay away from short sales! Unless you’re in no hurry to buy… it can take up to 6 months to even get a response back.

Post # 5
Member
2867 posts
Sugar bee

I slightly disagree with MissAsB.  If you find a foreclosure, make sure it’s 2/3-3/4 or less the market value of the homes around it.  Hopefully it’ll be 1/2-3/4 of your budget so that you can fix things.  But I do agree, usually people who get foreclosed on go through and tear stuff up.  I’ve walked through many a foreclosed homes as well as many newly built…grew up doing it.  Anyways, budget wise I wouldn’t consider getting a loan for an amount greater than 30% of your and your Fiance’s incomes.  I’d also suggest a 15 year.

Also, have a friend who you trust who knows electrical/plumbing look at the house before you purchase it.

Post # 6
Member
14186 posts
Honey Beekeeper
  • Wedding: June 2009

Definitely go UNDER what you’re qualified for. Keep in mind it’s a first home–make a list of MUST HAVES and what you’re willing to compromise on. Be open minded–your first home will likely not have every single thing you want. I woudln’t do a forclosure–soooo much work, plus money is usually needed up front for repairs anyways.

Look at old/new, just to give you an idea of what’s there. You may LOVE old homes, but you may also realize they are more work, more expenses, and more unpredictable than newer homes (the wiring? the plumbing? is the AC unit ready to go out? that’ll cost you 3K…). You never know what you may like =]

Post # 8
Member
52 posts
Worker bee
  • Wedding: August 2010

All this advice is great! I would also recommend checking out a few new home communities as well. You might like them as much and alot of the Arizona builders are offering interest rates in the 2-4%’s since they are desperate. Also if you do look at new communites make sure your realtor is with you so you get the best deal.

Post # 9
Hostess
18643 posts
Honey Beekeeper
  • Wedding: June 2009

Make sure you also budget in the other costs of living in a house (insurance, utilities, repairs).  You often forget about those when you are thinking about housing costs.

Post # 10
Member
295 posts
Helper bee
  • Wedding: June 2010

Generally I’d agree about avoiding foreclosures, except that you’re in AZ—you guys have the same glut we have out in CA right now, I think, and there are some astounding deals to be had here. So I wouldn’t rule out foreclosures entirely—we have several friends who’ve gotten homes that way for literally half of what they sold for just a few years ago. But *do* have any home (and especially a foreclosure) thoroughly inspected. And I’d avoid short sales, just because banks are so backed up with these right now that you could be waiting forever. (Foreclosures are generally not as hard to deal with on that front.)

I’m an old home lover—ours is a century old—and while they do come with challenges, a good inspection can assess most of that….and it’s good to remember that new homes aren’t all perfect either. Check the builder’s track record to make sure there are no problems with their other developments, and have the home inspected just as you would with an older home.

Most of all, though, have fun looking—check out things you might not think are appealing at first glance, because you might surprise yourself. I agree with the must have/would like to have/must not have list, which was critical for us. Good luck!

Post # 11
Member
46416 posts
Honey Beekeeper
  • Wedding: November 1999

When you look at a lot of houses it can become a blur.

Take pictures.

Make a checklist of your needs and wants and print out a copy for each home you visit. Include things like # of bedrooms, near parks and schools, transit if that is important etc etc

Don’t rely on friends to check out the plumbing and electrical. It is well worth the money to have it checked by a licensed, qualified home inspector.

Post # 12
Member
11325 posts
Sugar Beekeeper
  • Wedding: February 2011

Here is what I learned:

1- I thought I wanted an older home but I could buy a LOT more/nicer house with a new home due to the market in my area (like, if our exact house was listed by a person rather than a builder it would easily have cost 30k more)

2- don’t fall in love too fast. i thought i loved the first house because it was so much better than where i was renting and it was just like….. omg its so pretty! after looking at different places i realized i really needed features that house didn’t have

3- must have/must not have are important!

4- when it comes time to buy the house, make sure you keep money on hand for all the moving expenses and moving-in fix up stuff. We kept money out to do certain things and I’m SO glad that we did because if we didn’t do it right away we might not have. This included: new furniture for 3 rooms, painting 3 rooms, getting ceiling fans installed in the vaulted rooms. I actually wish we would’ve just gone ahead and done a fence right away too because now it looks like it’ll have to wait. 

have SO much fun shopping! I know a lot of people hate it, but we had a blast shopping and buying our home πŸ™‚

Post # 13
Member
1014 posts
Bumble bee
  • Wedding: May 2011

we’re first time homebuyers, and we purchased a foreclosure last year.  it was awesome, we saved a lot, which enabled us to remodel the kitchen and baths.  make sure you have cash for emergencies, and don’t put all of your savings into your down payment.  you’ll need cash for closing costs, too, so don’t forget to budget for that.  also, get a home inspection!  it’s a few hundred bucks, but you’ll know what potential problems their may be with the house.  inspections are soo important, especially for older homes.  i also advise getting a mortgage that could be paid by a single income if it had to come to that, in case one of you is laid off or has health issues.  you never know what the future holds, and it’s always good to be prepared.  πŸ™‚

Post # 14
Member
1317 posts
Bumble bee
  • Wedding: October 2010

Go to as many homes as possible just to look around. This might seem like a pain, especially if it’s a house you’re not THAT interested in, but seeing it in person may surprise you. Pictures lie! What seems perfect in pictures might not be so nice in person.

Think about the lifestyle you want to live outside from being homeowners. Let that determine your budget, not what you’re qualified for. I agree with the other Bees about not borrowing your max, although whatever amount you choose is a very personal matter, and you shouldn’t let others convince you otherwise (especially your real estate agent).

When we first started looking, everything seemed really nice! It took awhile before we were able to fine-tune our ideals. (For instance, we were dreaming of a small house in the countryside with a LOT of land … after driving on a few dirt and gravel roads, we realized we wanted neighbors and a store nearby!)

Also think about resale value and how long you see yourselves in the home. This factor holds a lot of weight when you’ve narrowed down your choices.

As for the paint, ignore it! By the end of our house search, we were hoping for some really fugly interiors! That way there would be less ppl interested! What we ended up getting is a house with funky colors, and a ton of garden work. It was also put on the market during winter, and we got a deal! Fi doesn’t mind hacking away the yard and I think painting is fun, so even after minor work, we’d be able to resell it for a higher price — but it’ll be our forever home Smile.

Good luck on your search and keep us updated! I love seeing older homes and would love to see the gems you end up finding!

Post # 15
Member
3219 posts
Sugar bee
  • Wedding: November 2010

We got a foreclosure for $112k less then the original listing! I say if you dont mind doing work and are handy foreclosures are great!

the best best advise i can give you is to go with an independant home inspector!

my 1st house i went with a guy who worked for himself and was certified and he was AMAZING & cheap ($150). He went thru EVERYTHING in the house down to making sure every drawer in the kitchen & bedroom worked properly. No  after moving in.

House #2 Went with NPI, i couldnt find the paper work from the prev inspector because everything was packed up! The inspection was horrible! the guy pretty much told us the deck needed to be stained and outlets were missing covers. Every section on the written report said to consult certified plummer etc… and it was $800. And we had sooooo many surprises like the gas leaked, the water line to fridge & dishwasher were busted, circulator pumps on furnace we broken, the roof leaked etc etc. Luckly for me Fiance is VERY handy and we didnt need to hire anyone πŸ˜€

Post # 16
Member
1523 posts
Bumble bee
  • Wedding: September 2010

I think you have gotten some great advice so far!

I also agree that you should take a lot of pictures. It’s amazing how much you forget once you have looked at a bunch of houses. I always started taking pictures of each home by taking a picture of the house and address so we would remember which one was which:)

I would also write out a list of must haves and things that would be great but not necessary. I think it’s important for first time homebuyers to realize that you will not get everything you want, so it’s important to figure out what is most important. Also think about these 3 things: location, cost and size/amenities. What things are most important to you?

We decided that location and size of home was most important to us. We don’t have the fanciest kitchen, but we will work on improvements over the years.

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