The Process of Buying My First Home!

I bought my very first home and I chose to go the fixer route! Going through the process I learned A LOT! To be honest the whole process happened so quickly! When I started actively looking to buying felt like a blink of an eye which I know is not the norm. But I wanted to share the process of buying my first home and some tips I learned along the way. 👇

Before Looking for a House

Over the last 6 years I have moved 7 times. Mainly to keep rent cheap and to deal with lots of changed going on in occupation. The first couple of moves were to Scotland and back. Then I had a TINY studio apartment that I adopted Addie in!

I then rented a room in my brother’s house until he lovingly evicted me as he was getting married and preparing to have his new wife move in. I was in a tight place still and moved in with my sister and brother-in-law where I downsized to fit all of my belongings into a spare bedroom. For months I lived with boxes stacked to the ceiling. From there I moved in with a friend. All this time I LONGED to create. I wanted to be able to transform my own space, but by making these sacrifices I was able to keep rent lower and save!

I wasn’t originally planning on saving for a home, but my Dad was the one who made a comment that buying a home was a cheaper process than most are aware of. With that little comments my mind kept coming back to the idea of buying a home.

Starting the Process

Finding a Realtor:

This was easy for me as I have known my realtor for over a decade, which made my decision easy as I didn’t have to worry about upsetting anyone I work with. As I  do marketing for Real Estate. For those who don’t have the privilege of knowing their realtor I would suggest Facebook. I would ask for referrals from friends and family as they have been through the process and would have a good idea who did a great job for them!

Finding a Lender:

This was part of what started my home buying process. I had recently started a new job and wasn’t sure if you needed 2 years of the same employment to get prequalified, just 2 years of employment or just 6 months at a job. I asked a lender colleagues of mine and was told just 2 years of consistent employment and before I knew it I was sending her my application.

TIP- Shop Lenders!!! This was a hard concept for me! As my whole life I have been in customer service where everyone else is the client or customer, but for once I was the customer. Lenders are NOT all the same. In a kind manner you have the right to shop for the best deal. I would reach out to multiple lenders. They all can very in percentage down, lender fees, lender credits and interest rates.  I personally went to 3 different lenders. This allowed me to get a great loan program. I did a conventional loan with 3% down. I would recommend staying away from MFA loans if possible as it is two mortgages. The smaller sum is to help with closing cost, however be aware as some can have VERY high interest rates on the smaller loans. I was offered this from a lender and was very leery.

Shopping for the Right House

Wants:

There is so much to take into consideration! For me I was trying to stay as realistic as possible (although I’m sure my realtor would probably disagree 😂 I did want a few things though. Part of wanting to buy a house was having space to welcome others to. Especially having a spare room for international students to stay in as I volunteer with the local University and a ministry that serves study abroad students. When they first arrive here they need temporary stays, and I so desperately wanted a space to be able to host them in. As I remember how scary moving to a foreign country can be. Part of that was to have at least 2 full baths so my guest would have their own space. I also wanted to live on a certain side of town and in my city there is the west and east side. I personally wanted a shorter commute and grew up on the east side of town so that was an absolute must have. However, the east side can tend to be high prices for less space. So that in part made me think creatively that I would want a fixer upper. Lower in price, but having potential. Also not having an space of my own for the last few years made me LONG to create and have a vision for a space. To be honest I didn’t really have any other major wants because I knew I could probably create the space I wanted.

Looking at Houses:

I only looked at a total of 4 homes. I loved the first townhouse I looked at mainly for the price, however, this house had a $250 a month HOA. Which caused some serious hesitation and after a day I found the house went under contract. The second townhouse I looked at was a TOTAL remodel as it basically looked like it should be condemned. However, I saw the potential. I remember walking in with my family and telling them keep an open mind. Walking around saying my ideas for restoration so they wouldn’t think I was completely crazy! As time went I was looking for a lender that could do a HUD loan and a contractor to get back on estimates. As I was waiting the house went under contract. It took a while for me to see another house again that I was interested enough to go look at. The next one was a condo that did little to spark imagination when I walked in and a TINY patio for a backyard. Shortly after my Realtor sent me my current home. It ended up being a bit higher priced than I anticipated however, it was a foreclosure without an HOA and in an area of town I LOVE. 🙌 After wrestling over it I decided to at least go see it in person. After walking through I loved the funky layout, but held my excitement pretty close to my chest.

Putting in a Offer:

I asked my realtor to see if he could find out the banks lowest number. I needed the price to come down by about 10k. Finding out that the bank’s bottom line was in my budget I was leaning towards making an offer. However, a small caveat was that they would not pay any closing costs. This sent me in a panic to try one more lender to see if they would have a better lender credit and fees so I would have more resources to go to closing cost. Another a BIG thing for me was getting the offer directed to a Stewart Title (where I work) for closing because I knew having it directed to an Escrow Officer I know would give me a peace of mind. After a few days of waiting (feeling like I would get the text at any moment that the house went under contract with someone else) I finally had my lender in order and made an offer.

My offer was accepted with no counter! Excitement was so hard to contain! But nerves set in quickly as there was no contingency in the offer. Meaning if there was some terrible thing that came out in inspections I wouldn’t have the ability to take my earnest deposit and walk away. We reached out to the bank on this issue but it was already Friday evening and no word. I had until Saturday evening to make a decision. My biggest concern was the roof, as two leaks were noticed when we were walking through the house. I had to decided if the future investment was worth the small gamble. If the house was in worse condition than looked and if I didn’t have the funds to source it would I be ok with losing my earnest money. By 4pm on Saturday I was able to get a roofer out to give a quick look over. Hearing back that it would be reasonably repairable I was able to accept the official contract with an hour to spare!

In Escrow

I turned my earnest deposit to the Title company the following week and my contract got sent to title. It was such a sweet God thing that I got to watch the process of my contract in a way many others don’t. Doing this whole buying a house thing on my own was scary! However, I was able to have the peace of mind knowing the people working on my house. I was able to look at my title binder and learn all about the history of my house, and walk downstairs in to Escrow and talk to the escrow officer handling my home about any concerns I had. (Title is making sure there are no financial leans on the property and you will own the land free and clear. Escrow is the neutral mediator between parties, they pull information from the sellers and buyers, pulls HOA docs, works with lenders and any attorneys involved…)

Very quickly I had to set up inspections. I was so thankful for a realtor I trusted because it was hard to know what to look for in choosing who to use. I did look at reviews online and made my decision between that and my realtors expert opinion. I had to then call electric and gas to make sure all connections would be turned back on by the time the inspections would come.

TIP- During this time I also had to choose home insurance. I wish I had been told to do this earlier. I didn’t realize this was something that you needed to pick quickly in the process and I felt very overwhelmed and stressed making the search and decision quickly for home insurance. I wish I knew before I even got into the contract to begin looking and shopping for the best home insurance instead of feeling rushed into a decision.

There are a lot of documents that need to be sent over to your lender to finish the underwriting process, and because of the loan I chose I had to take a home owners course that took way longer than the 1 hour that was projected.

Not Everything Will Go Smoothly- Though most of my home buying process was smooth there were some hiccups along the way. While my house was in Escrow I was told by the title department that they were looking for an existing survey of the property. If there is an existing property this could save you about $200-500 on closing cost. Since I was paying all cost including all inspections, all title fees and surveys I was very cautious about cost. I had a family member offer to do the survey for me if there wasn’t any existing survey as he is a land surveyor at a low cost. However, communication was not given to all parties and a survey was requested. I didn’t know until after when I was sent the survey in an email, and was forced to have to pay that cost. Expect a upset or two in the process. I had to let this roll of my back and think about all the other things I was grateful for already in this process.

I did my best to not become attached to the house emotionally until after inspections. I knew if there was a major fix that I would have to walk away from the house. This was so much easier said than done! Once the inspection came back with nothing I didn’t already suspect it was all downhill for not being attached! Then I began to dream and start building a vision in mind for the house. Once this point hit everything else was quiet as well. I remember calling my realtor asking what I needed to be doing. Part of the quiet is I actually asked for a 45 day closing time where as most people go for 30. I was not under a time constraint to move in or move out. So I had extra time to wait!

Then 3 days before closing I got my Closing Disclosure with the amount to bring to closing. Which included a majority of my inspection costs. I also chose to get a cashiers check instead of wiring. Partially because of the amount of wiring fraud that is prevelenet today. I felt more confident with a check.

Closing  

Closing for the buyer consist of tons and tons of paperwork to sign. It can feel like you are signing your life away, but that is normal! Your escrow officer will go over what you are signing. You will see your note and breakdown of payments and principle. A typical closing will take about 45 minutes to an hour. Once all the documents are signed you wait for your contract to get recorded at the county and funded, if you live in New Mexico, as we do not automatically receive our keys here at closing. Once I got the call I had the keys and the house was mine!

It’s Normal:

It’s normal to have a freak out or moments of feeling overwhelmed. I remember seeing numbers on paper after my offer was accepted and in contract that made me panic a little. “What if my car breaks down? What if I have a complete roof repair I can’t fix? What if the house floods? ” All the what if questions started swirling around in my mind. After asking others and talking to wise council I realized that it was normal. Almost everyone that is buying a house has the same panic and fear because what you are doing is HUGE. It is a real responsibility. Budgets have to be a priority and everything with the house is up to you. Something my Dad told me gave me perspective and I want to share it with you. Even if you realize in your panic you may know become what is called “house poor” you have to remember that this purchase is an invest you will you everyday! Even when times get tougher and funds may be tighter you will be using that investment, and it is an opportunity to trust God. I remember a time when money was VERY tight, but He always came through. I think God was using that season to prepare me for trusting Him in this one.

After the Move:

I’ve been in the house for a few weeks now and it still feels surreal. I keep saying it feels like I am play dress up or house sitting for someone else just waiting for them to come back. I know it will set in with time, and I am so grateful for this new journey. I have a LOT of work ahead of me still with this house, but I am excited to watch and see the transformation.

Tip: Buy yourself a little house warming gift. With everything you have to buy and all the non-fun essentials make sure to treat yourself to a small little something at least! For me that was finally getting to buy a fun doormat! I’ve got my blog to a few of my favorites linked here!

If you are thinking of buying your first home I would wrap it up to a couple of things… Pray, do your research, reach out to multiple lenders, ask friends and family for Realtor recommendations, write out a list of what you want (cross off what you are willing to compromise on), hop on Zillow and start looking. When I started looking I felt the phrase gently run through my mind “Just giggle the door handle”. So for you maybe consider just giggling the door handle.

Happy House Hunting

With Grace,

Carissa