Monday, June 27, 2011

Getting a deal on a house.

Getting a deal on the house of your dreams, while living the nightmare of a short sale.
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The hubs and I have been together since April-06 We had actually met 2 years prior while I was working at the local country bar.... (I know, You never pictured Moi working at a Country bar-I was selling pull tabs for a charity). We were married in April of 2008.
So now to the guts of the story, We have been living at my Mothers house this whole time... well... I've been here my whole life, never moved out. Never needed to. We have our little agreement with my Mom, we cover a large portion of the bills as rent.
As things go, we need more space! The kids need space. I would like to be able to OWN something, Be able to make the changes We want. So back in March the hunt began for our home.
First thing is first: Listen To your Parents and Friends when it comes to house hunting, They know a thing or 6.
We found a house that we absolutely loved - the first one we walked in. It was old, needed work. Which at first didn't bother us. But there was still something that just didn't feel right. So we went and looked at a few more houses.
On our 6 or 7th house we found our dream house. It was the first one that both the Hubz and I had the collective... " Yes , I really like this one!" 5 Bedrooms 3full bath's and the icing on the cake... 6 car garage! I can still hear Craig's surprised " HOLY SHiiiiiiiiiittttttt!" echoing through the garage when John our real estate agent opened the garage door.
Now for the pain in the ass news.... its a short sale.. ughhhhhhh!
For those of you who don't know what a short sale is, remember this: Its a LONG SALE.
In theory a short sale is when a mortgage is in trouble of being foreclosed on and the seller/owner is trying to sell it before the bank takes it away from them. Banks don't like to do this because they take a loss. BUT from a Buyer's point of view , You can get one hell of a deal!
The house we put a bid on , we will be paying 58% less the amount the current seller paid for it in 2007. HUGE Savings !!! HUGE!!
I had been wanting to start house hunting for the past few years so I started buying books on buying homes, with emphasis on Foreclosures. Because of the fact you can sometimes get a SUPER deal ! But with a deal comes the crap.
We put in our offer on the house March 28th 2011, fully knowing that it could be 3 weeks -It could be 3 months..... It will be 3 months as of tomorrow. We are sooooo freaking close I can taste it!
The process started with us putting in an offer, and signing what felt like 40 pages of the same thing over and over.
Our Real Estate Agent John kept reminding us " This is a short sale..... The winner in a short sale is the patient person, If you really want this house you have to be willing to wait it out. "
So began the waiting game, in the mean time we kept on looking online at houses to see if anything sparked our interest.
When someone puts an offer in on a short sale, it roughly takes about 2 weeks for the bank to even see the file on their desk . Thanks to the shit storm of foreclosures in the past few years, this department of the bank is a VERY busy department.
After a month and a day, we got the notification that the next step was the BPO- Broker Price Opinion. To put it in layman's terms... Someone from the bank is ganna drive by the house and see if it is priced appropriately for the neighborhood.
In the mean time most of the negotiations and counter offers that came after were all minor, (Negotiating the percent that the seller will pay for closing, title company stuff )
If you are planning on buying a house , Look into what the local county has for first time home buyer deals, The house we are purchasing right now is in Dakota County. Depending on your income you can pretty much get all your closing costs paid for with the first time home buyer bond program. The catch is that you have to take a home buyers class... TOTALLY WORTH THE MONEY!!! We took the 8 hour class on a Saturday morning and learned so much about the home buying process, not only from the teacher but also the stories from the other people taking the class.
So as of the last few weeks the biggest hurdle we had was finding out that the house had a second mortgage. In a short sale, ALL the money (our money)goes to the first mortgage. The second mortgage wants to get paid too. So the mortgage insurance policy that was taken out on the first went to the second mortgage.... You following me still??... Well guess what they wanted more then the policy was paying..... ( $5000 policy--- they wanted $10,000) ... So we Wait..... and wait.... Then comes the phone call from our agent.... "The second mortgage is willing to make this go faster if you contribute towards the additional $5000".
My first reaction... HELL NO! That's not my problem.... Patience is the key... and that key will open the front door to my new house! Let them continue their monetary cat fight! All the while The Hubz and I sit back and save more money for the house.
So WHAM BAM.... Fast Forward to This morning.
I receive an email from our Real Estate Agent John , stating that we have a clear to close letter from the mortgage insurance company and the next few steps are getting an Appraisal, getting an Inspection and then a lightening speed closing!
Wooooo this has been a long wait but my life's lesson for this year has definitely been PATIENCE!!!