What to Do When Home Repairs Aren’t Done at Closing

Repairsatclosing

We just bought a new house – hurrah! Of course, there were repairs that needed to be done before we moved in, each of them documented in a formal repair proposal and sent to the seller.

We had a list of ten items that needed to be fixed. Some of them were big (like fixing a cracked tub that had leaked into the floor below) and some were smaller (like fixing a dyer vent). When we went to do our walk-through the day of closing, we found that only three out of ten repairs had been done.

Here’s what we did when we found out the repairs weren’t fixed, and we still wanted to move in:

  1. Talk to your Realtor first: Your Realtor is there as your advocate. Tell them exactly what hasn’t been fixed (they’re usually at the walk-through with you and can make a list right there). Once they have noted what still needs to be repaired, they’ll connect with the seller’s agent to tell them we’ll be sending another request.
  2. Decide if you want to move in as scheduled: This is a tough call. While you still have a signed contract saying they’ll repair these things, you’re also giving the seller ALL YOUR MONEY! Who’s to say they won’t just pick up and leave you with the fixes? Then you have legal issues, which is not what you want after just buying a house. Talk to your Realtor to decide what’s right for you.
  3. If you move in as scheduled: Get your Realtor to write an addendum to the contract, stating that you’re not taking the house “as is” and you’ll still request all fixes be done by a certain date. We gave them one week. This is submitted at the closing table or before, and ensures that the seller knows these things need to be done. The seller needs to sign this addendum as well (sometimes easier said than done!)
  4. If you don’t move in as scheduled: You still send the same addendum to the seller, and state that you will not close until the repairs are complete. You can put a time frame on the addendum as well, so you’re not stuck waiting in limbo. In both cases, your Realtor will keep on the seller’s Realtor to make sure everything is being completed.
  5. Coordinate the repairs yourself: Once we moved in, we gave my number to the seller’s Realtor, who then passed it on to the seller’s general contractor/property manager. I was able to coordinate directly to get all repairs done while I was at the house. I was also able to speak directly with the property manager (not always the case) to express our concerns. I like being in control of the repairs, so you can watch the trades and ensure the job is being done properly.
  6. Get receipts: We’d requested in writing that all repairs be done by a certified professional. While some were done by the seller’s property manager, some of the items we made sure were fixed properly and were given receipts for. This allows us to go back to the company who did repairs if something goes wrong or wasn’t done properly.

Repairs are usually part of any real estate deal and cause a lot of headaches. We want to know – What has your experience been with getting repairs done on a home you’re buying?

The First Time Homeowner’s Guide to Home Inspections

first time homeowners guide to home inspections

We’re right in the thick of it when it comes to home buying – we have an accepted offer on a house, and we just had our very first home inspection!

Here are the things us first-time homeowners learned about home inspections:

  1. Find the right inspector: We would have preferred to go with our Realtor’s suggested inspector, but he was busy due to weather issues. Instead, we went with an inspector who’d just done our friend’s 1930’s house. A good recommendation is key, and you should also ensure they’re certified or licensed. Our inspector also sent us waivers and information prior to the inspection, so we had time to read over everything. Nice!
  2. Go to the inspection. Seriously, no excuses!: We insisted on going to our home inspection, even though our Realtor let us know it wasn’t necessary. But it IS necessary for first time homeowners! This is where you learn all about your potential new home. The inspector can tell you how to operate things like garage doors, electrical panels, thermostats, and water shutoffs. They can also give you really good info what the house is actually like, as opposed to just reading his itemized list. Think of it as your “orientation tour” of the house.
  3. Go armed with a list of questions: We had tons of questions about the house, and items we’d found (like water stains). I wanted to be prepared to also ask questions about the life of certain items, like the roof and hot water tank. If you don’t go with a written list and you’re incredibly forgetful (like me), you’ll probably forget to ask the right questions and be stuck wondering afterwards. That’s the worst!
  4. Get trade and supplier suggestions: Our inspector found some minor issues with ductwork and windows, along with a garage door that needed repair. For each item, he gave us a contact name and number of a certified professional who could fix it for us. That gave us a great place to start, especially since we knew NO professionals (on account of us being newbies!)
  5. Follow that inspector around: I was totally okay to follow the inspector from room to room. You’re paying $300-$400 for this, and this is your time to get as much knowledge as possible. See what he’s pulling out, and ask questions if you see something you’d like to get checked out. I noticed damaged closet doors and major dents in the walls that I hadn’t noticed before, and was able to ask him to put those items on the inspection.

    Yep, we followed our inspector everywhere!

    Yep, we followed our inspector everywhere!

  6. Ask as you’re following: While my husband wanted to wait until the end and ask all the questions at once, I knew I would forget unless I asked right away. This stops two issues from happening. One – You won’t forget to ask once you get to another room in the house. Two – You won’t have to go back to that area of the house again if you have follow up questions. This is incredibly important after the inspector comes out of the crawl space and attic areas. Nobody wants to be in those spaces longer than they have to!
  7. Be on the same page before the inspection ends: Our inspector made it clear that we could call him any time if we had questions or concerns, but he also took the time to show us his photos and address everything that would be an issue. Some things we hadn’t seen, like a disconnected dryer vent and a loose condensation pipe. It was good to review everything and ask additional questions.

    The inspector hooked up his computer and went through every photo with us.

    The inspector hooked up his computer and went through every photo with us.

We actually really enjoyed the inspection process, and so should you! Let us know what kinds of experiences you’ve had with inspections – comment below.

Making an Offer on a House: A Guide to Keeping Your Sanity

keepingsanity

We have an accepted offer on a house! It’s a 1988 square foot two storey house in a suburb outside of Nashville, Tennessee. While we’re excited, the process of making an offer and waiting to hear back from the seller was excruciating! It took me to the limits of my sanity, I lost sleep over it, and it was just brutal. Here’s how it all went down, and how we remained (somewhat) calm and got through it.


We made the offer: We viewed the home on Tuesday, and made the offer on Wednesday afternoon. We offered $15,000 lower than asking price, because of the comparibles in the neighborhood (your Realtor will find similar houses that recently sold and base the offer on the price of those houses). Coming up with a price was difficult, but it seemed like we were right on with the other prices in the ‘hood. Here’s some more information about coming up with the right offer price.

The “counter-offer process”: This part is all about waiting – and guessing. We didn’t hear back until late the next night (even though the offer expired at noon that day), and the seller countered at full asking price but was willing to pay closing costs. Because we felt that would still be overpaying, we countered back at $10,000 less than asking price, with closing costs. We had no idea what he was willing to get for the house, so it was a best guess.

We gave him 24 hour to respond. Finally, his Realtor emailed our to say he’d “verbally countered” with our $10,000 less asking price, but no closing costs. So we said “OKAY!” and signed an offer on Saturday afternoon. We had agreed to all of his demands, and all he had to do was sign.

Waiting for final offer acceptance: This, by far, was the worst part. We had to wait almost four days to hear if our offer had been accepted. I had a good meltdown during that time, because we were pretty much powerless as we waited. It’s an awful position to be in! On Tuesday morning, we got confirmation our offer was accepted. Hurrah!

Why the seller isn’t getting back to me: Firstly, it’s a Realtor’s legal obligation to present an offer to a seller. So never think “They never got the offer.” That’s rarely the case. Chances are, they’ll eventually get back to you either way. Our Realtor told us that the “it’s my house, you’ll work on my time” attitude is pretty common. A seller may not be getting back to you because they’re waiting for:

  • A better offer to come along
  • An open house to happen (that happened to us, they waited the full weekend to get back to us)
  • Another showing to happen
  • Still making their mind up
  • Finding a chance to sign the paperwork and send it back
  • Just making you wait, because they feel like it (which is the worst) 

We coped with the stress of waiting for the contract to be signed by doing a few different things.

  • Looking for other houses: Yep, we still looked every day on MLS to see what else was out there. It helped us to know that there were other houses available if this one didn’t come through.
  • Keeping in contact with our Realtor: We didn’t want to bug her daily, but I feel like that’s what we probably did. I’m okay with that, I’m not good at waiting and communication was key to me feeling calm and confident about our offer. Sometimes it’s just good to hear someone say “This is normal.”
  • Talking to friends and family: It was great to vent our frustrations to friends and family. My dad said “You should tell the seller that every day he makes you wait, you’ll take $1,000 off the price.” While not at all realistic, it was funny and made me feel better. It’s good to have other people in your corner, and being a voice of reason.
  • Go drive around the neighbourhood: We spent one afternoon just driving around the area, getting to know the back roads and seeing what was around. It really just gave us something to do, instead of sitting around waiting.

Waiting for an offer to close is brutal, and it’s really only the first of a few steps in homeownership. But it’s well worth it. Check out the first step in first time home buying here.

5 Mistakes We Made While Viewing Houses

viewinghousesOnce you have your dream team in place (getting a mortgage lender and Realtor), it’s time to start shopping! We found this to be the most frustrating and also the most exciting part of the house hunt.

It all starts online. We used the HomeScouting website that our lender had given us, along with listings sent to us from our Realtor, to find the houses we wanted to see. Your Realtor will work with your schedule to find times to see houses, and we saw most of them during weekday evenings. Be ready to jump at the chance to view a house if it’s listed in a hot market.


When we started walking through properties, here are some things we wish we’d done differently:

  1. Not taking photos:This is major. We didn’t take any photos of the houses we saw during our first walk throughs, and we got so confused. “Was that one that had the weird ceiling fans?” or “Which house had the new hot water tank?” Take photos of every room, and even a video if you’re walking through for the first time. We made an offer on the house and had a full discussion afterwards about where the master bedroom door actually was. It’s hard to remember without photos, and it’s well worth the extra few minutes to take them. Don’t assume the listing photos will help – they’re usually crummy photos!

    Take photos of details, like crown moulding or built-in features.

    Take photos of details, like crown moulding or built-in features.

  2. Not taking our time: You usually have a full hour appointment for a house. I often felt rushed when looking through houses, especially when my husband and Realtor were two or three rooms ahead of me before I’d finished looking at the first room! I wish I hadn’t felt so rushed – it’s my right and responsibility to walk through each room slowly. You catch way more and remember it better when you take it slow.
  3. Not looking at the details: This goes hand in hand with taking your time. Look up at the ceilings (my husband did this and noticed water staining, important stuff!) Look in every closet and stand in each room for a few minutes to look around. Look in cupboards, under cabinets, in toilets, and behind doors. Take a look at the thermostat, garbage disposal, and any other working parts to see how it all connects to your potential home.
  4. Not testing stuff: Testing stuff is good, even before inspection, because it helps you understand the inner workings of a house. Flick on every light switch, flush the toilet and then run the faucet at the same time. Sit in the bathtub and see if it fits a 6’2 guy (yep, we did that). Use the garbage disposal, and open the garage door. Open every door, for that matter. We noticed a lot of sliding doors that didn’t work properly, or closet bi-fold doors that were broken and propped open.

    Hunt under the cabinets and try out the garbage disposal!

    Hunt under the cabinets and try out the garbage disposal!

  5. Not wandering around outside: Oh yes, you can be that creeper lurking around the neighborhood! We did a lot of this by going back during the day, but it’s good to go around at night too. Walk around the full perimeter of the house and take notes. On the houses we forgot to walk around, we had to use Google StreetView and the listing photos to piece together the details, which isn’t ideal. Things to look at: How many outlets are there, where are the faucets, and how sturdy is the deck? Where’s the air conditioning unit located, and is it in good condition? How have the neighbors kept up their property? We went back in the day to the property we were interested in and found there was a large city electrical service box on the lawn. While it didn’t bother us, it was good to know!
Taking detailed exterior photos helps!

Taking detailed exterior photos helps!

House shopping is both fun and entirely exhausting. Do your best to keep your wits about you and pay attention to each and every house – and hopefully you’ll find your house!

The 23 Questions We Asked at Mortgage Pre-Approval

Preapproval

The first step we took in our house hunting is mortgage pre-approval. We needed to know how much mortgage we could get. We found our mortgage lender, Churchill Mortgage (and our awesome team member Sue F.),  through a friend and booked a meeting.

We weren’t sure if we wanted to even go with this company, so it was our time to interview. Remember, you don’t have to pre-approved with the first lender you see – just make sure you don’t go through the credit check and then decide against them. That’s a check you’ll never get back!

Here are the questions we asked the mortgage lender in the first pre-approval meeting.

Questions about the broker/lending company:

  • What does your company charge for fees?
  • What’s a good faith estimate, and does your company provide it?
  • Do you guarantee your good faith estimate?
  • When do you do hard credit checks, and what’s the process?
  • Have you worked with foreclosures?
  • How long will you hold my pre-approval for?

Questions about mortgages:

  • What does “APR” mean?
  • What interest rates can we expect?
  • How long will you lock those interest rates in, or will you lock them in at all?
  • How does private mortgage insurance (PMI) work?
  • Is there a way to not pay the mortgage insurance, or to lump it into the mortgage amount?
  • Can we do lump sum payments on the mortgage balance?
  • What are mortgage points, and are they a good fit for us?
  • What are origination fees?

Questions about the home purchase process:

  • How much will closing costs be, and who pays for them?
  • How do we pay for inspections, and how much will they be?
  • How do appraisals work?
  • How much will an appraisal be, and who do we pay?
  • Are there first-time homeowner grants available?
  • How does title insurance work?
  • Do you have any recommendations for home insurance providers?
  • How do property taxes work, can we pay them monthly, and where do we pay them?
  • Do we have to pre-pay for any services before we move into a house?

Here’s what we found out during the meeting that we think is important.

Ask how much: The biggest question we asked at the end of the meeting was “How much are we going to pay out of pocket when we close on this house?” The answer (if the seller pays the closing costs), was about $1000 for all inspections and appraisals.

It’s fine to say “I have no idea what that means”: The best thing we did in that meeting was to clarify, clarify, clarify. People in this business have been doing it a long time, and use acronyms and lingo we didn’t understand. So we were okay to interrupt and say “We don’t know what that means.” A good lender will answer everything clearly.

Avoid the pressure and take a beat: They wanted us to sign on the spot and get started. So we just took five minutes in the hallway of the office to talk about whether we were okay with these lenders and if we were fine with the credit check. We signed once we’d both agreed we were comfortable.

After the pre-approval meeting, we decided to go with this lender. Take a look at this post to see what we had to provide to the lender once we decided to get officially pre-approved, and how the whole process worked.

How to Make the Ultimate First Time Homeowners Wish List

wishlist

We’re two weeks into house hunting, and we’re only now realizing how important a specific wish list is. We both have a little knowledge going for us, which has proven crutial! Figure out specifically what you want before you start!

Here are the items you should be looking for, and talking about before you start your hunt:


Neighborhoods: When we started house hunting in Tennessee, we had one neighborhood we wanted, but there’s been nothing available and we lost the one house we bid on (and we overbid!) So we’re looking outside of our perfect ‘hood, and we’ve done this by finding listings and driving to them.

See who’s walking the streets – is it young mums with strollers or scary looking guys smoking on their stoops? We drove into one nice-looking community and literally got chased out by someone’s vicious dog. No thank you!

We’ve now found four communities we’d be okay with living in, instead of just one. That opens up our house options a lot more!

On the cat's wishlist, a house with a good view of squirrels.

On the cat’s wishlist, a house with a good view of squirrels.


Floorplans: Also called layouts, this is how the house is designed. I did marketing for a home builder for years, and have also done my fair share of award judging for the national new home builders association, so I know a good floorplan when I see it. Things I knew I wanted were:

  • A two storey house
  • A master bedroom on the second floor
  • A two car garage
  • An open concept floorplan
  • A kitchen that had more than one entrance (for flow)
  • Three bedrooms
  • An ensuite
  • A half bath that was separate from living (some houses have them in the kitchen, gross)

Once we started walking through, we realized things we didn’t like, including:

  • Big bonus rooms (a big empty room you have to heat)
  • Jumbo vaulted ceiling living rooms (who wants to paint that?)
  • Master bedroom in the front (some are next to the front door, which I find odd and not very private)
  • Upstairs bedrooms with 45 degree angled doors (they create some strangely shaped rooms)
We love the open concept floorplan of our current house.

We love the open concept floorplan of our current house.


Finishes: I’m a DIY-kinda gal, so I’m okay to do a bit of reworking and painting. My husband just wants to move in. So finishes became important as we started walking through houses. Here are the tough questions we had to discuss once we saw a house with a great layout and bad finishes:

  • Do we want to paint the whole house, or just some specific rooms?
  • Are we okay with carpet and lino, or do we want hardwood and tile? If so, how are we going to pay for that?
  • Are we fine with maple finish cabinets with old hardware, or can we paint them?
  • The siding is looking rough, do we want to clean it?
  • If the exterior or landscaping needs work, will we do that ourselves?
  • If there isn’t a fence, are we okay to put one in?
  • The doorknobs and hardware is outdated, are we going to replace those, paint them, or live with them?
  • Are light fixtures important to us, or how much will that cost to replace?
  • The tub and major bathroom elements are old, but working. Are we okay to live with that?
We love the floorplan of this house, but it needs some help!

We love the floorplan of this house, but it needs some help!


Big ticket items: Things like hot water heaters and roofs aren’t cheap. So knowing what you’re okay to live with and what you’re okay to fix is major. We don’t want to replace a roof (that’s upwards of $6,000) but if we have to replace a hot water heater in a few years, we’re fine with that. Talk about how much you have to spend, and be on the same page.

Lots of listings tell you in the description when stuff was replaced. If you love a house and want to make an offer, a disclosure document is provided from the owner (unless it’s a foreclosure, then it’s a guessing game). That’ll tell you what they’ve replaced and when, or if they’ve done any fixes. We found out about some leaks in the ceiling and plumbing issues on a house we put an offer on. While it didn’t deter us, it was good to know.

Bonus: You can buy a homeowner warranty for about $500 a year that’ll cover those big ticket items. Worth the investment, and sometimes sellers will pay for it! It’s a “peace of mind” warranty that I’m all for.

Whatever your wish list is, make sure you know the basics ahead of time. It’ll save a lot of looking around and a lot of unnecessary “discussion” (opinions + big purchase = arguments!)

3 Ways To Know How Much House You Can Afford

How much house1

We’re newlyweds living in Tennessee, and we’re currently on the hunt for our first house. I’m from Canada, and my husband has lived in Tennessee for quite a few years.

We’re house hunting because our landlord is selling our adorable 700 square foot rental home. We’re happy to be in a new house, especially since the sewage system backs up and the kitchen boasts a tiny portable dishwasher.

So it’s time for us to become first time homeowners – and whoa is it overwhelming!

The first step is figuring out how much you can afford. Here’s how we decided how much house we we could buy:

1. Know Your Monthly Payment: 

We’re pretty good budgeters, so we know we have around $1100 left each month after all of our bills are paid. So we fiddled around with our favorite tool in the world, the Zillow mortgage calculator to find our maximum house price.

Here’s what you should factor into your monthly house payment, and a lot of it is stuff nobody ever explained to us:

  • Actual monthly mortgage payment (principal and interest): The basic Google mortgage calculator will do this for you. Remember that your mortgage amount is after downpayment. So our $180,000 house will have a mortgage of $171,000 (when you factor in our downpayment of $9000).
  • Homeowners Insurance: This is insurance to protect you and your house in case of disaster. It means you’re covered if someone slips on your floor and sues for injuries, or if a rain storm damages your roof – but lets hope neither happens! It’s about $1000 a year or more, split into monthly payments.
  • Private mortgage insurance (PMI): You will have to pay this, unless you have a 20% downpayment. Our rate is .52% of the mortgage, split up into monthly payments. Rates differ by lender.
  • Property taxes: Find this numbers on the house listing you’re looking at on Zillow, then split that up into 12 payments per year. Our annual payments will be around $1,500-$1,800 (that’s $125 monthly), and they’re paid to the county you live in.
  • Homeowner Association (HOA) Fees: Most newer communities have this, and it pays for the basic maintenance and enforcement in a community, but you’re still responsible for your own land. It’ll be anywhere from $15-$50 a month.
  • Condo fee: If you buy a condominium, you’ll pay a monthly fee for a management company to take care of your property. That means any shared spaces, like roofs, lawns, and waste management. Expect upwards of $100 a month

2. Find Your 5% Downpayment: Yeah, easier said than done right? But knowing how much you have to spend as your 5% makes it easy to see how much house you can pay for. If you have more than 5% to put towards a house, good on you!

We also found out about the Tennessee Housing Development Agency Great Start Loan. It’s a “forgivable loan” which means you don’t have to pay it back if you live in the house for 10 years! That’s a free downpayment, people! You have to get an Federal Housing Association FHA loan though, instead of a conventional loan.

If you get an FHA loan (Federal Housing Administration) at 3.5% down, the interest rates and PMI’s are usually higher than conventional loans. Plus, you have to pay PMI for the life of the house, unlike normal loans which cancel the PMI after you’ve paid 20% of the mortgage principal. Still, it’s a good option if you’re cash strapped.

3. Add Up The Extras: All the little extras add up, especially if you’re buying a house that needs work. Here are some extras we’re adding into our budget. Remember that these are out of pocket expenses, you can’t put them in your mortgage. So make sure you have enough cash for a full downpayment plus another $1,000-$2,000 for extra expenses.

  • New furniture – Budget a few hundred dollars or more more. You’ll want new furniture if you purchase a larger house than what you’re used to, and especially if it has a bonus room! We’re planning on eventually buying a guest bed, because we’re moving from a one bedroom house. Remember you can purchase these pieces over time.
  • Moving truck and supplies – Budget a few hundred for this if you rent a truck and supply your boxes, and budget more if you plan to hire a moving company (upwards of $1000 depending on how far you’re moving).
  • Paint: If you need to repaint most rooms in the house, you can bet around $500 will be spent on paint and supplies (less if you already have painting tools and supplies).
  • Appliances  – Budget about $1,200 for a washer/dryer, because they usually get taken when the seller moves (we’re planning on paying less by buying them used). If you already have those and all appliances are in good working order, that’s awesome!
  • Cleaning- Budget $100-$200 for washing down surfaces, renting carpet cleaners, having the ducts cleaned, or pressure washing the house. It all adds up.

Once you’ve figured out what you can afford, don’t shop yet! Keep checking our latest posts to see each step of the home buying process as we go through it.