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Mama Deb
mamadeb
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December 2010
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Mama Deb [userpic]

My landlady just had the house appraised.

I work in a real estate office. I know what that probably means (probably because she could also be doing it for insurance or tax reasons).

If she's thinking of selling, we have to start thinking of buying something. Not this house, unless it's in our price range (although wouldn't that be nice? She has a gorgeous kitchen.) but a house or a condominium. But buying because I'm tired of living at the whim of someone else. We've been thinking along those lines anyway. And our lease is up in September. Which might be enough time.

So. What would be the first step?

Comments

Figure out what you can afford, both amount and flow. You'll want to get pre-approved for a mortgage, but my experience is that lendors will approve you for larger amounts than you'd actually be comfortable with if you look at the "what this means on a monthly basis" calculation. So start trying to get a price range you'd actually be willing to spend in.

You work in a realty company; I presume you know how to find all the relevant listings. :-) (And other service providers, for that matter -- mortgage, agent, attorney, etc.)

Start looking at places. Take notes during or immediately after each walk-through; don't rely on your memory to tell you which had the decent kitchen, which the attrocious floor plan, and so on. Don't worry about getting all the details on this pass; this is your first-pass filter. The questions you want to answer on this pass are "does this location work?", "can we imagine our stuff working well in this house?", "does this have basically the kind of space we want?", etc. For you, also "can we kasher this kitchen?" and perhaps some size contraints in the bedroom.

Keep in mind that some problems can be fixed for money or sweat (consider it an addition to the closing costs) and some can't. Ugly wallpaper can be fixed; a weak foundation can't be.

When I was doing this for the first time I got a lot of benefit from a book (title forgotten) by Bob Villa (the "this old house" guy). That was 13 years ago so maybe that's not even the specific book you'd want now, but there are books out there that will give you advice on what to look for in walk-throughs and in paperwork. I have a friend who's a civil engineer who did pre-inspections for me on the short-list houses (ones I would have made offers on); if you know someone like that, I'd say it's well worth buying such services. This is the pre-offer sanity check; mine worked fairly cheap. You also want the real inspection, but the pre-inspection saved me the effort on one house that meant I didn't have to go through the offer-inspect-withdraw cycle.

You'll want to get pre-approved for a mortgage, but my experience is that lendors will approve you for larger amounts than you'd actually be comfortable with if you look at the "what this means on a monthly basis" calculation. So start trying to get a price range you'd actually be willing to spend in.

Remember to add taxes and insurance to the calculation! Our actual mortgage part of the payment is only about 2/3 of the total cost.

When I was doing this for the first time I got a lot of benefit from a book (title forgotten) by Bob Villa (the "this old house" guy).

I don't know about that book, but we found a book called something like "Questions Every First Time Homebuyer Should Ask". Pretty useful.

Remember to add taxes and insurance to the calculation!

Also condo fees, if you buy a condo (I don't know what the housing stock is like in your area).

What everyone else has said about getting preapproved and figuring out wants and needs. When I was looking, I wanted a kitchen that had a reasonable amount of space for milchigs and fleishigs, good light, and reasonably quiet. Wants included a guest room and a sukkah porch, and I was lucky enough to get both, though I almost didn't, since I had time limits and almost bought the place I saw before this.

Around here (in MA), there are first-time homebuyer classes, which are not only informative, but can also get people a slightly lower rate on the mortgage. It was offered through the city, I believe. There may be other first-time homebuyer offers out there as well.

Good luck.