House-buying thread - Why is everyone involved in this process so deeply stupid?

The Something Awful Forums > Discussion > Ask/Tell > Business, Finance, and Careers > House-buying thread - Why is everyone involved in this process so deeply stupid?

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H110Hawk: Dec 28, 2006

SouthShoreSamurai posted:

For all of you that have recently purchased homes, what did you end up doing about the Title insurance?

I know the lender insurance is mandatory and the buyer insurance is optional, and from everything I've read most of the buyer insurance is actually just going to the closing lawyer as grift, but... It appears to be a pretty even split of people that say "definitely get it" and people that say "don't bother getting it."

Title insurance is (generally) very cheap at $500ish bucks. If you need it in the entire time you own your home the payout is likely at least 5 figures wide. That spread should show you how infrequently you need it, but there is a reason your lending institution takes it out. They can arguably afford the $xx,000 "oops" more than you can.

# ? Apr 24, 2017 20:02

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# ? May 28, 2024 04:43

Twerk from Home: Jan 17, 2009; This avatar brought to you by the 'save our dead gay forums' foundation.

SouthShoreSamurai posted:

For all of you that have recently purchased homes, what did you end up doing about the Title insurance?

I know the lender insurance is mandatory and the buyer insurance is optional, and from everything I've read most of the buyer insurance is actually just going to the closing lawyer as grift, but... It appears to be a pretty even split of people that say "definitely get it" and people that say "don't bother getting it."

If your house were paid off and you weren't required to carry homeowners insurance, would you? Title insurance protects against a similar level of losses, but at even lower odds. Up to you, but if the loss of the majority of your house's value would leave you in a position you couldn't recover from I would buy it.

# ? Apr 24, 2017 20:08

Leperflesh: May 17, 2007

H110Hawk posted:

there is a reason your lending institution takes it out. They can arguably afford the $xx,000 "oops" more than you can.

While I agree that you should probably have title insurance, this specific argument is significantly weakened by the fact that the lender makes the buyer pay for their title insurance. So the only cost they bear is the potential of a borrower to torpedo the entire mortgage on the basis of not wanting to pay for the lender's title insurance, which I imagine happens approximately never.

Title insurance is exactly like all insurance: it seems like a huge waste of money until you need it.

# ? Apr 24, 2017 20:28

H110Hawk: Dec 28, 2006

Leperflesh posted:

While I agree that you should probably have title insurance, this specific argument is significantly weakened by the fact that the lender makes the buyer pay for their title insurance. So the only cost they bear is the potential of a borrower to torpedo the entire mortgage on the basis of not wanting to pay for the lender's title insurance, which I imagine happens approximately never.

Title insurance is exactly like all insurance: it seems like a huge waste of money until you need it.

I actually discarded an edit with that in it. Largely they don't think you can bear the risk/cost of a title lawsuit so they make you take out insurance against their interest in your title.

# ? Apr 24, 2017 21:13

Dwight Eisenhower: Jan 24, 2006; Indeed, I think that people want peace so much that one of these days governments had better get out of the way and let them have it.

Title insurance is a one time fee for some people familiar with real property law to examine the title for the property you are purchasing and to determine if it is legally binding, and then, if they determine that it is a valid title, to provide you a compensatory guarantee that the title is valid in the rare event that a court of law were to invalidate the title.

That step of provenance verification should certainly happen before you sign over large sums of money to the person selling you the title. So then the only question is, who would you trust to do that job without providing a corresponding monetary guarantee of their determination?

For me, the only answer is myself, and I don't know real property law in the jurisdiction where I live sufficiently well to evaluate someone else's title. So I'm happy to pay the few hundred bucks for title insurance.

# ? Apr 24, 2017 21:44

metztli: Mar 19, 2006; Which lead to the obvious photoshop, making me suspect that their ad agencies or creative types must be aware of what goes on at SA

Photex posted:

Spent almost $600 the first weekend in my new house

I'm almost at $6k on mine... I'd been budgeting for $10k so pretty happy.

# ? Apr 24, 2017 22:59

Rotten Red Rod: Mar 5, 2002

Just realized I never updated anyone here on my home sale journey... Almost immediately after we fully moved out (like a few weeks), we had a fast-track offer for 640k from an investor and sold. They never even had time to show the staged property to any non-investors. The hardest part was just getting my wife's dad to respond in a timely way to things his signature needed to be on.

Moral of the story: don't get your hopes up about getting a sale if you aren't moved out. Investors really aren't interested in rentbacks for the most part. Also, keep your roof maintained - our electricals and pipes are old and jacked up, but everyone focused on the roof repairs almost to the exclusion of everything else and I wish I had fixed it earlier.

I expect to still post here years down the road, though, as I'll own my parents' two properties in San Diego some day! We're now helping them pay off their house, and will move into the fully-paid off condo once that's done.

# ? Apr 24, 2017 23:30

Tricky Ed: Aug 18, 2010; It is important to avoid confusion. This is the one that's okay to lick.

If you don't have earthquake insurance and your house falls over, you still own the land. If you don't have flood insurance and your house washes away, you still own the land. If you don't have title insurance and someone else exercises a lien you didn't know about, you own nothing, and you don't get any of your money back from the bank.

Always get title insurance (and probably other insurance too).

# ? Apr 25, 2017 07:06

Leperflesh: May 17, 2007

Yeah that's absolutely true.

But also with flood or earthquake, you own the land, but what you own is land with maybe a condemned house on it, in a neighborhood with lots of other condemned houses on land. Clearing the land is expensive, and you'll need to sell it immediately just to pay some fraction of the mortgage and/or default on the mortgage and lose the land too. And if you are selling your land with a condemned house on it, you'll be in a marketplace suddenly flooded with similar properties, which is not a buyer's market, so the prices will fall.

This is why flood or earthquake insurance is good, even with a huge deductible. The insurance policy covers your rear end so you can dispose of the property without being financially ruined.

# ? Apr 25, 2017 07:14

LinYutang: Oct 12, 2016; NEOLIBERAL SHITPOSTER

VOTE BLUE NO MATTER WHO!!!

I made an offer for a house that I've been renting for a few years, and the owner accepted. Do I need a buyer's agent at this point? What would they actually do for me?

# ? Apr 25, 2017 14:48

No Butt Stuff: Jun 10, 2004

LinYutang posted:

I made an offer for a house that I've been renting for a few years, and the owner accepted. Do I need a buyer's agent at this point? What would they actually do for me?

Paperwork? I'd just get a real estate attorney.

# ? Apr 25, 2017 15:29

Hashtag Banterzone: Dec 8, 2005; Lifetime Winner of the willkill4food Honorary Bad Posting Award in PWM

LinYutang posted:

I made an offer for a house that I've been renting for a few years, and the owner accepted. Do I need a buyer's agent at this point? What would they actually do for me?

No you don't need an agent. I would google or ask lawyer friends for a real estate attorney if you want someone to help draft the documents and make sure you aren't signing anything you shouldn't.

# ? Apr 25, 2017 15:29

LinYutang: Oct 12, 2016; NEOLIBERAL SHITPOSTER

VOTE BLUE NO MATTER WHO!!!

Makes sense, thanks!

# ? Apr 25, 2017 16:30

Photex: Apr 6, 2009

code:

When the Lender prepared your Mortgage they used the incorrect condo name.

Just received an email saying we have to go back to the law office and have the mortgage corrected :suicide:

# ? Apr 25, 2017 16:54

H110Hawk: Dec 28, 2006

Photex posted:

code:
When the Lender prepared your Mortgage they used the incorrect condo name.
Just received an email saying we have to go back to the law office and have the mortgage corrected

Or wait for them to serve you, assuming you didn't reply to the email. :v:

"Not a problem, send a mobile notary to my condo this saturday at 11:00AM and we will resign documents."

# ? Apr 25, 2017 17:05

Droo: Jun 25, 2003

Photex posted:

code:
When the Lender prepared your Mortgage they used the incorrect condo name.
Just received an email saying we have to go back to the law office and have the mortgage corrected

Did you already close on the house and have the title assigned to you? Does this qualify as some kind of "bank error in your favor, receive free house"

# ? Apr 25, 2017 17:23

Elephanthead: Sep 11, 2008; Toilet Rascal

Droo posted:

Did you already close on the house and have the title assigned to you? Does this qualify as some kind of "bank error in your favor, receive free house"

It would except one of the things you signed you agreed to come back and sign things they screwed up.

# ? Apr 25, 2017 18:26

Problem!: Jan 1, 2007; I am the queen of France.

Dumb question incoming :siren:

Where does the money that pays the realtor's commission come from? Is that something we should budget for?

# ? Apr 25, 2017 21:09

Twerk from Home: Jan 17, 2009; This avatar brought to you by the 'save our dead gay forums' foundation.

Problem! posted:

Dumb question incoming

Where does the money that pays the realtor's commission come from? Is that something we should budget for?

The seller pays it. Whenever you sell a house, get ready to fork over 6% + seller closing costs.

# ? Apr 25, 2017 21:26

Rotten Red Rod: Mar 5, 2002

Problem! posted:

Dumb question incoming

Where does the money that pays the realtor's commission come from? Is that something we should budget for?

The escrow company should handle that out of the sale profits, they did for us when we sold.

Edit: yep what they said /\ \/

# ? Apr 25, 2017 21:26

Drunk Tomato: Apr 23, 2010; If God wanted us sober,
He'd knock the glass over.

Problem! posted:

Dumb question incoming

Where does the money that pays the realtor's commission come from? Is that something we should budget for?

Seller pays it. Not dumb, I thought for the longest time we'd have to pay our agent. But usually the buyer will pay all or a portion of closing costs, which can be substantial.

Drunk Tomato fucked around with this message at 21:28 on Apr 25, 2017

# ? Apr 25, 2017 21:26

Problem!: Jan 1, 2007; I am the queen of France.

We're doing new construction, does that still apply?

We're down to budgeting the extras like closing costs and I thought of the realtor and was like "oh gently caress".

# ? Apr 25, 2017 22:06

QuarkJets: Sep 8, 2008

Problem! posted:

We're doing new construction, does that still apply?

We're down to budgeting the extras like closing costs and I thought of the realtor and was like "oh gently caress".

Yes

Although with new construction sometimes the developer may try to get you to pay for the realtor as part of the purchase agreement (which you should read carefully), I don't think it's commonly done

# ? Apr 25, 2017 22:22

Photex: Apr 6, 2009

What's a good starting hardware sequencer for a beginner? I currently have a Minilogue, Volca Kick and Volca Bass. Is the SQ-1 still the recommended or is it the Beatstep Pro?

edit: Ever since my house purchase i've been making so many mistakes. Don't purchase a house. i'll leave the original message so everyone can mock me

Photex fucked around with this message at 16:07 on Apr 26, 2017

# ? Apr 26, 2017 14:07

EAT FASTER!!!!!!: Sep 21, 2002; Legendary.

Photex posted:

What's a good starting hardware sequencer for a beginner? I currently have a Minilogue, Volca Kick and Volca Bass. Is the SQ-1 still the recommended or is it the Beatstep Pro?

Pretty sure you've managed to post in the wrong subforum, friend!

# ? Apr 26, 2017 14:41

Elephanthead: Sep 11, 2008; Toilet Rascal

EAT FASTER!!!!!! posted:

Pretty sure you've managed to post in the wrong subforum, friend!

Water is still the enemy.

# ? Apr 26, 2017 14:46

silvergoose: Mar 18, 2006; IT IS SAID THE TEARS OF THE BWEENIX CAN HEAL ALL WOUNDS

Photex posted:

What's a good starting hardware sequencer for a beginner? I currently have a Minilogue, Volca Kick and Volca Bass. Is the SQ-1 still the recommended or is it the Beatstep Pro?

You need a stud finder in order to sequence your hardware in a house, I'd say.

# ? Apr 26, 2017 14:54

DR FRASIER KRANG: Feb 4, 2005; "Are you forgetting that just this afternoon I was punched in the face by a turtle now dead?

The Beatstep Pro is the Dewalt of sequencers.

# ? Apr 26, 2017 14:54

Photex: Apr 6, 2009

god damnit.

# ? Apr 26, 2017 16:08

silvergoose: Mar 18, 2006; IT IS SAID THE TEARS OF THE BWEENIX CAN HEAL ALL WOUNDS

Photex posted:

god damnit.

We're seriously only mocking because every time anyone does something like this, in any megathread, it's hilarious. :3:

# ? Apr 26, 2017 16:18

Judge Schnoopy: Nov 2, 2005; dont even TRY it, pal

I went 22 days from walking through our first house to an accepted offer, with 8 or 9 houses in between. I've been watching house prices for about 6 months previous. Because this was so fast, we extended our closing date to July 1st and everybody is telling me I'm crazy, that this is a really long time to closing. I'm in no rush to get in the house as every month I rent I'm saving more money.

Am I crazy for pushing the closing off by 75 days? Is there a potential downside to this I'm not seeing? Seller agreed to it since they need to buy a new house and don't have anything lined up yet.

# ? Apr 26, 2017 19:02

Leperflesh: May 17, 2007

You may have problems locking a rate for a 75 day period without paying extra/getting a higher rate. But there's no like paperwork reason you can't, and if the sellers are fine with it, then whatever.

# ? Apr 26, 2017 19:06

baquerd: Jul 2, 2007; by FactsAreUseless

Yeah, since the seller seems to be in to it, win win situation.

# ? Apr 26, 2017 21:41

SurgicalOntologist: Jun 17, 2004

I've posted in this thread before, but now it's time to start making moves and I've got some actual questions. Mainly about the whole loan qualification process.

Looking to buy a house in ~6 month, moving to a new state. We're visiting the area in a few weeks so we'll be checking out some open houses (been stalking the neighborhood on zillow for months already). But I guess it might be time to start looking for a lender?

The issue is, we don't yet have new jobs lined up--and the situation is complicated. Let me just lay it out:

I'm starting a business and it could easily be six months until I can start drawing a salary.
Given the above, the reason buying a house might still be possible is that I received a big windfall earlier this year, about 40% of the houses we've been looking at. Made a smaller but not insignificant amount last year too, from the same source. I'm hoping it's consistent but don't want to rely on it. Reported as hobby income in 2016, so not technically self-employment, but could file that way for 2017. Of course a portion of that is set aside for taxes, and we paid off the highest-interest portion of the student loans, but we haven't made any major purchases. I would feel comfortable with our savings to make a 20% down payment and also not earn income for up to a year. Of course, the lenders won't see it that way.
That said, I will probably get some part-time work, could be W2 or 1099 depending on how some research grants go (I'm a scientist, a buddy has been putting me in his budget for every grant application he submits) but I won't know that for a few months at least.
My wife, on the other hand, should not have a problem getting a solid W2 job. According to some mortgage qualification calculator Google found, her hypothetical salary on its own might just barely qualify us for the size of loan we want. She doesn't actually have a job offer yet, though, and of course won't have income history with the new job until we actually move.
If our history matters, we have 2 years of W2 income high enough to qualify us.

So, given all that nonsense...

Are we hosed?
Is it possible to just use my wife's income to qualify and pretend I don't exist?
How should we navigate this with lenders? Should we wait until my wife has as job offer in hand?
Is a job offer even enough or are we going to have to do some bullshit like stay in a hotel or get locked into a lease while we build up income history in our new city?

# ? Apr 27, 2017 00:44

balancedbias: May 2, 2009; $$$$$$$$$

SurgicalOntologist posted:

I've posted in this thread before, but now it's time to start making moves and I've got some actual questions. Mainly about the whole loan qualification process.

Looking to buy a house in ~6 month, moving to a new state. We're visiting the area in a few weeks so we'll be checking out some open houses (been stalking the neighborhood on zillow for months already). But I guess it might be time to start looking for a lender?

The issue is, we don't yet have new jobs lined up--and the situation is complicated. Let me just lay it out:

I'm starting a business and it could easily be six months until I can start drawing a salary.

Given the above, the reason buying a house might still be possible is that I received a big windfall earlier this year, about 40% of the houses we've been looking at. Made a smaller but not insignificant amount last year too, from the same source. I'm hoping it's consistent but don't want to rely on it. Reported as hobby income in 2016, so not technically self-employment, but could file that way for 2017. Of course a portion of that is set aside for taxes, and we paid off the highest-interest portion of the student loans, but we haven't made any major purchases. I would feel comfortable with our savings to make a 20% down payment and also not earn income for up to a year. Of course, the lenders won't see it that way.

That said, I will probably get some part-time work, could be W2 or 1099 depending on how some research grants go (I'm a scientist, a buddy has been putting me in his budget for every grant application he submits) but I won't know that for a few months at least.

My wife, on the other hand, should not have a problem getting a solid W2 job. According to some mortgage qualification calculator Google found, her hypothetical salary on its own might just barely qualify us for the size of loan we want. She doesn't actually have a job offer yet, though, and of course won't have income history with the new job until we actually move.

If our history matters, we have 2 years of W2 income high enough to qualify us.

So, given all that nonsense...

Are we hosed?

Is it possible to just use my wife's income to qualify and pretend I don't exist?

How should we navigate this with lenders? Should we wait until my wife has as job offer in hand?

Is a job offer even enough or are we going to have to do some bullshit like stay in a hotel or get locked into a lease while we build up income history in our new city?

There's a chance you'd be looking at some unfavorable rates if you don't don't have a consistent source of income for conventional lending. The W2 history certainly helps, but nothing lined up at time of application can be an automatic disqualifier. It sounds like you have reserves, but that's exactly how the lender sees it, too (just reserves that will get depleted without proof of steady income).
If you don't mind, what's your rush to purchase a house in the new area?

balancedbias fucked around with this message at 04:08 on Apr 27, 2017

# ? Apr 27, 2017 00:58

SurgicalOntologist: Jun 17, 2004

Mainly just that moving sucks and I don't want to have to do it more times than we have to.

Also, there just aren't that many apartments options that are appealing. At least not in our first-choice neighborhood (which has plenty of houses for sale and new ones popping up all the time). And for the apartments that are attractive, rents seem out of wack with the local house prices. We're comparing $200K houses to $1500/mo apartments.

# ? Apr 27, 2017 01:14

QuarkJets: Sep 8, 2008

I don't think that anyone should buy a house in a new place until they've become pretty familiar with the area. You should rent for a year (or 6 months or whatever the normal lease length is in your new city)

And if your business fails and your wife can't support the payments herself then you guys are so fuuuucked

QuarkJets fucked around with this message at 05:07 on Apr 27, 2017

# ? Apr 27, 2017 04:56

AntennaGeek: May 30, 2011

Time it took use to close on current house last fall: 2 hours 15 minutes due to bank shenanigans.

Time it took to close on sale of previous house yesterday: 19 minutes start to finish, because cash, yo.

# ? Apr 27, 2017 11:47

Problem!: Jan 1, 2007; I am the queen of France.

QuarkJets posted:

I don't think that anyone should buy a house in a new place until they've become pretty familiar with the area. You should rent for a year (or 6 months or whatever the normal lease length is in your new city)

Yup this is what we're doing now. We're doing new construction so we're putting down a lot deposit soon but we don't close till the house is done. If we decide we hate the area we're not committed till closing and can walk away and just lose $2000.

We didn't unpack everything and saved our boxes so packing to move again won't be a giant rear end pain.

# ? Apr 27, 2017 15:33

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# ? May 28, 2024 04:43

SurgicalOntologist: Jun 17, 2004

QuarkJets posted:

And if your business fails and your wife can't support the payments herself then you guys are so fuuuucked

Sure, but that's a big "if" (the second one). Her salary is already more than enough for all our current expenses, in a higher COL area, with our current rent roughly equal to mortgage payments. To put some numbers on it, we're sitting on $100K cash and looking at $200K houses. Let's say we move with enough salary lined up to pay expenses and continue maxing out our Roth IRAs, and have 1.5 years emergency savings after the down payment. Are you telling me that's too risky?

QuarkJets posted:

I don't think that anyone should buy a house in a new place until they've become pretty familiar with the area. You should rent for a year (or 6 months or whatever the normal lease length is in your new city)

This is a fair point. I mean, we feel we know the area well, we both have close family there and visit a few times a year, but yeah we've never lived there.

The apartment market just seems like such poo poo. At least we have the luxury of being patient, maybe some appealing options will materialize over the summer...

# ? Apr 27, 2017 15:40

The Something Awful Forums > Discussion > Ask/Tell > Business, Finance, and Careers > House-buying thread - Why is everyone involved in this process so deeply stupid?

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