Possibly buying a house, have questions

exalted512

The wife and I were driving around last night and came upon a house we really like. Well, I haven't seen the inside yet, but she has, and I saw the pictures we took. We're going again tomorrow to look at it.

Anyway, say we like it. I have a few questions. I live in Texas if that matters.

1. This home is a builder home, we were going to deal straight with the builder, not using a realtor. Anything we should know about not using a realtor? The builder is JKM Classic Homes in College Station, TX. I can't find anything bad on them, even at the BBB.

2. There's a Texas program that will give you $7,000 interest free for 90 days, with a $250 flat fee. http://www.tdhca.state.tx.us/homeownership/fthb/docs/dpa-infosheet.pdf

Basically, what my plan is to use that for part of our down payment. The thing is, we don't have very much in savings, we'd be okay for a month or two. But we aren't going to have any problems with getting laid off, just if one of us got hurt, etc. So should we save that tax credit as a cushion in case we get in a bind, or use it for the down payment? The house doesn't really need anything done to it, its basically brand new. But also, I'll be working full time next year, starting in January at my current job, so I'll be making at least $700 more/month, so we'll be able to get a better cushion then. We're normally better at this, but the wedding came and really depleted our savings...lol.

Thanks in advance!
-Cody

disneyjoe7

I would see a mortgage loan person and see what you can afford or get approved for. It's not as easy as buying a car or something.


Good luck.

kcoc321

Besides all the financial things, you also want to have someone who knows real estate law look over the contract, and specifically the warranties for what is covered and for how long. Most are for a year.

I would also suggest getting it fully inspected, by an a credited inspector.

exalted512

disneyjoe7 wrote: »

I would see a mortgage loan person and see what you can afford or get approved for. It's not as easy as buying a car or something.


Good luck.

Being approved isn't the issue, that's already been taken care of.

kcoc321 wrote: »

Besides all the financial things, you also want to have someone who knows real estate law look over the contract, and specifically the warranties for what is covered and for how long. Most are for a year.

I would also suggest getting it fully inspected, by an a credited inspector.

Doing both of those for sure. Just wanted to know if anyone else had anything particular to watch out for. I'd rather catch something than pay someone a couple hundred bucks to. Either way, if i dont catch anything, its going to a lawyer, but if its something that will throw a red flag by me looking at, I'd rather save that money.
-Cody

Zeros

Correct me if I'm wrong, but you wouldn't have to pay a realtor out of pocket, they would just get paid when you buy the house. So what is the harm in having your own realtor? Also, the builder probably has their own realtor doing the sales. At least that's how it was done when we bought our house from a builder.

TNRabbit

If this is the first house you've had in over 3 years, you can close on it by 1 Dec 09 (good luck!) and get an Obama incentive of $8k for first-time homeowners (applies if you haven't owned/lived in your residence for 3 years as of closing date).

unc2701

Zeros wrote: »

Correct me if I'm wrong, but you wouldn't have to pay a realtor out of pocket, they would just get paid when you buy the house. So what is the harm in having your own realtor? Also, the builder probably has their own realtor doing the sales. At least that's how it was done when we bought our house from a builder.

Yes, but they're more likely to cut you a deal if you don't get a realtor involved (they won't have to pay that commission). Go ahead and knock another 2% off whatever you were thinking of offering.

bruss

make sure they hook you up for not bringing a realtor. if not go get one and make them deal with all the BS

Zeros

That's so true. The BS is something that I'd rather not deal with. That's why I'm glad we used a realtor, even if it was my sister in law.

jimmydep

Having a third party (possibly your sister-in-law) to help negotiate the best price is always good.

Make sure you have a thorough home inspection done, even on a newer home. Also If it's a new home ask the local building department for the file to see if there were any failures during the inspections, if so then make sure any problems were completely addressed.

As always have a real estate attorney review all documents before signing them.

Most important...Ask alot of questions....any questionable items, get it in writing.

Good luck
Jimmy

maandjojo

Exalted, so far so good. There is no problem at all dealing directly with the builder. I am 58 and been through a few deals in my time. Make sure you write down all the questions you have in your head and then ask them. Get a lawyer to look at the paperwork before you sign anything. Never give them a no return deposit until the lawyer has seen paperwork. Builders are like anyone else, some good some not so good. I know its scary but go for it.

Joe

Zeros

Oh, I was very rude and did forgot to say good luck. I hope everything does well for you while purchasing your new home.

reeltrouble1

cody the builder will screw you seven ways from Sunday and then laugh about it.

proceed with caution if you go it alone.

I would use a realtor who will specifically act as your Buyer's Agent, otherwise their fudiciary responsibility is to the seller regardless if you called them, they picked you up and drove you there, it also includes any negotiation.

If you are not going to do a tradtional 80/20 loan then put down as small a down payment as you can and bank the rest in some kind of fund not easily turned liquid at least something a bit more than a checking account.

Enjoy...buying your first home is exciting, oh yea, as far as dough, dont count your chickens before they hatch.

RT1

exalted512

unc2701 wrote: »

Yes, but they're more likely to cut you a deal if you don't get a realtor involved (they won't have to pay that commission). Go ahead and knock another 2% off whatever you were thinking of offering.

exactly

bruss wrote: »

make sure they hook you up for not bringing a realtor. if not go get one and make them deal with all the BS

plan on it

maandjojo wrote: »

Exalted, so far so good. There is no problem at all dealing directly with the builder. I am 58 and been through a few deals in my time. Make sure you write down all the questions you have in your head and then ask them. Get a lawyer to look at the paperwork before you sign anything. Never give them a no return deposit until the lawyer has seen paperwork. Builders are like anyone else, some good some not so good. I know its scary but go for it.

Joe

started the question list a couple days ago. def. going to get a lawyer to look at everything before anything is signed.

reeltrouble1 wrote: »

cody the builder will screw you seven ways from Sunday and then laugh about it.

proceed with caution if you go it alone.

I would use a realtor who will specifically act as your Buyer's Agent, otherwise their fudiciary responsibility is to the seller regardless if you called them, they picked you up and drove you there, it also includes any negotiation.

If you are not going to do a tradtional 80/20 loan then put down as small a down payment as you can and bank the rest in some kind of fund not easily turned liquid at least something a bit more than a checking account.

Enjoy...buying your first home is exciting, oh yea, as far as dough, dont count your chickens before they hatch.

RT1

we cant quite do 20% down. So you think we should put the 8k in something other than the down payment? The way im looking at it is were going to pay more for interest by not putting the 8k down than what we would make on interest if we invested it.

We are also def. getting credible inspectors....pest, structural...all that good stuff.
-Cody

dorourke07

Make sure you have a home warranty put in the deal to cover anything the builder won't warranty, i.e. a furnace etc.

kcoc321

Regarding the comment about the building department inspections, there should be an itemized inspection sheet with the date that each portion was signed off, FINALIZED BY an Certificate of Occupancy, which means everything has been signed off on.

exalted512

kcoc321 wrote: »

Regarding the comment about the building department inspections, there should be an itemized inspection sheet with the date that each portion was signed off, FINALIZED BY an Certificate of Occupancy, which means everything has been signed off on.

you mean there should already be one?

reeltrouble1

yes there should be, but that does not mean you do not inspections and by the way the inspectors have there own way putting it to you with disclaimers about the inspection, look at the fine print.

I suggested banking the dough because your short on cash, eight grand less down is not that much more on your payment, I would however get to the 80/20 point as quickly as possible by paying extra if your anticipated funds increase so you do not have to pay that stupid mortgage insurance fee, personally I have never done anything but the 80/20fixed rate, no points on any of my homes.

RT1

exalted512

reeltrouble1 wrote: »

yes there should be, but that does not mean you do not inspections and by the way the inspectors have there own way putting it to you with disclaimers about the inspection, look at the fine print.

I suggested banking the dough because your short on cash, eight grand less down is not that much more on your payment, I would however get to the 80/20 point as quickly as possible by paying extra if your anticipated funds increase so you do not have to pay that stupid mortgage insurance fee, personally I have never done anything but the 80/20fixed rate, no points on any of my homes.

RT1

were getting an inspection done no matter what, it would be nice to know if something was already done though.

Were not really short on cash, we just dont have an abundance. Like I said, we'd be good for a couple months easily, but I know its suggested to have 3-6 months of bills saved up. I think we might go ahead and put the 8k down, as you like you said, 20% and no PMI.
-Cody

jimmydep

kcoc321 wrote: »

Regarding the comment about the building department inspections, there should be an itemized inspection sheet with the date that each portion was signed off, FINALIZED BY an Certificate of Occupancy, which means everything has been signed off on.

I hold multiple inspector licenses in NJ, My suggestion about checking the inspection logs for failures is that inspectors will document any code violations they find, this gives you a feel for what is going on "behind" the walls. If there is an over abundance of failures or failures of a severe nature, then Buyer beware.

Just because your issued a certificate of occupancy only means the house was built to minimum specifications.

Checking with the building department is FREE and hopefully you'll find there were zero failures!!!

Jimmy D

exalted512

jimmydep wrote: »

I hold multiple inspector licenses in NJ, My suggestion about checking the inspection logs for failures is that inspectors will document any code violations they find, this gives you a feel for what is going on "behind" the walls. If there is an over abundance of failures or failures of a severe nature, then Buyer beware.

Just because your issued a certificate of occupancy only means the house was built to minimum specifications.

Checking with the building department is FREE and hopefully you'll find there were zero failures!!!

Jimmy D

So is that something I asked for from the builder or do I need to find the local building department?
-Cody

kcoc321

jimmydep wrote: »

I hold multiple inspector licenses in NJ, My suggestion about checking the inspection logs for failures is that inspectors will document any code violations they find, this gives you a feel for what is going on "behind" the walls. If there is an over abundance of failures or failures of a severe nature, then Buyer beware.
Just because your issued a certificate of occupancy only means the house was built to minimum specifications.
Checking with the building department is FREE and hopefully you'll find there were zero failures!!!
Jimmy D

I agree Jim, the inspection logs are a good barometer of the quality of his work. I was merely pointing out that the inspection sign-off sheet would show the history of each inspection. Also,as far as inspection logs, most building departments, at least here in Washington, have those available online.
I would actually ask him AND get a copy from the building department. IF he is hesitant to give them too or if there is a discrepancy between the two, then you know to be wary.

As a separate item, also ask the builder for a complete copy of the approved house plans and any associated engineering. If nothing else it will help you if you ever intend to remodel down the road. And of course have them update any changes that were made.

raidersrule76

I would also ask for a list of others that have had work done by this builder. I realize that you didn't find anything in the bbb when you checked but that dosen't always mean that they have never had problems with stuff that they have done. I would go and talk to people that have bought houses and had work done by the contractor and just check the waters to make sure no problems.

Mark

Squidmon

As a Realtor,.....use one. They dont cost you as buyer anything. Why not have someone on your side? Dont expect the builder to be working in 'your best interest' like a Realtor would.

jimmydep

exalted512 wrote: »

So is that something I asked for from the builder or do I need to find the local building department?
-Cody

I would suggest you go to the building department yourself, and keep the seller out of it.

Again, this is only another source of information that might prove helpful in making your final decision.

If the builder has other houses under construction, take a look at those, chances are the quality of construction will be similar to the house your considering.

You should post some pics, so we all can start getting excited for you.

Jim D

daboyz

Have you thought of looking at foreclosures? Unfortunately buying a new house now is almost like overpaying with the deals that can be made on foreclosures. The kids behind me bought a $230,000 house for $155,000. The house is three years old. Instant equity.

Just my opinion but if I were in the market the ONLY homes I'd be looking at is foreclosures.

kevhed72

Do NOT close until everything is complete to 100% satisfaction. Don't get rushed into closing with the "promise" (even if a signed document / stated within contract) that the remaining odds and ends will be completed after you close. In this housing market, you weild all the power over the builder / agent. just my .02 from experience...

devani

jimmydep knows what he's talking about....Although I only do the commercial building system designs as an engineer, also ask the owners of the homes they built.....go to them ask them about the quality and see if there's anything worth noting...

unc2701

daboyz wrote: »

Have you thought of looking at foreclosures? Unfortunately buying a new house now is almost like overpaying with the deals that can be made on foreclosures. The kids behind me bought a $230,000 house for $155,000. The house is three years old. Instant equity.

Just my opinion but if I were in the market the ONLY homes I'd be looking at is foreclosures.

Foreclosures are a gigantic pain in the ****. Yes, you can get a deal, but it's a total trainwreck- I tried to buy three before we found a place that we wound up getting every bit as cheap as a foreclosure. It might be a little much for your first time out.

The other problem is that all foreclosures are "As-is" and both the bank and the prior owner will neglected them and/or have beaten the **** out of them. If you do go that route, ask around what kind of issues you need to look for in your area; around here, if you leave a house with the power off for a few months, you'll get a major mold issue sooner or later.

SKsolutions

If you're googling the builder, you're very short on information.
Interview a couple of buyer's agents and pick one. They should make sure the rest of the bases are covered, and may end up saving you quite a bit.

Polkersince85

Check the heat/cooling unit. Be sure it has the new refrigerant in it. Otherwise if it fails you may be buying a new unit or paying through the nose for R-22.