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Looking to move to San Diego in the next month and have a couple questions on the home buying process with respect to mortgage shopping. My understanding is that we would first look for pre-approval from a lender, bank, or company to start house hunting; this is different from a loan estimate (and may or may not retire a credit pull)? Once we find a place, we can then submit the address to get a more detailed and formal loan estimate from different places, and this is where we would be doing our shopping and comparing rates, correct? Or do we shop around for pre-approval as well? If that's right, where do most people do their shopping? Just any banks in the local area or the big online mortgage companies? For our last house we went with the lender our realtor works with, and also called rocket mortgage; rocket want even close to the local lender (and continued to call us now stop for months after), and in hindsight our rate from the lender wasn't bad but not nearly as good as whatever the going rate was at the time. We admittedly didn't do a lot of shopping and just rolled with the realtor recommendation when rocket turned out so bad, so we'd like to do it right this time.
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Aug 15, 2020 14:40
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Summit posted:Made a full price offer day one of house going on the market. No seller contribution. No contingency on sale. Still haven’t heard back. It’s full price! It’s exactly what they asked for! What’s the hold up? (It’s only been a day but still) The hold up is someone else brought cash. Might even be less cash than asking, but a bird in the hand is worth two in the bush. edit: also in a seller's market like this plenty of people list a house for less than they're actually willing to accept in an attempt to wait it out and attract a bidding war
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Aug 15, 2020 19:24
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Summit posted:Made a full price offer day one of house going on the market. No seller contribution. No contingency on sale. Still haven’t heard back. It’s full price! It’s exactly what they asked for! What’s the hold up? (It’s only been a day but still) That depends on if the seller is someone who just bought a new house and is happy to get the transaction done quickly at list price, or if their true full price is List Price+$20k after a bidding war.
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Aug 15, 2020 20:27
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I understand my angst was unjustified. Still kept me up all night. Anyway what happened was they had showings scheduled and wanted to see the outcome of those. The outcome was a second offer. They then invited us to bid again. We did, but for less than they other people. However, because they liked our letter they with us! So another data point in favor of letters. Now I begin the process of draining all my bank accounts and sanity (moving sucks)😦 We really do love what we found. Definitely paid a premium for it but it’s a great house for our needs/desires. Summit fucked around with this message at 20:57 on Aug 15, 2020 |
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Aug 15, 2020 20:46
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What’s the general consensus on escalator clauses in an offer? We’re at the no longer loving around stage after whiffing on our 5th offer over ask. The next one we like we’re planning on going in 5% over with an additional $10k in escalators if need be.
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Aug 15, 2020 22:16
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Diva Cupcake posted:What’s the general consensus on escalator clauses in an offer? I feel like agents on either side aren't too keen on those. After all if you are reserving the right to increase your bid then everyone else gets to as well and then it's just an auction again. Personally I'd just do a strong offer but only make it good for 24 hours or until end of day (say there's an equally good house you want to make an offer on and that's why you need a fast response on this one). That at least separates out motivated sellers from those who want to take their sweet time for the highest offer they can squeeze out.
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Aug 15, 2020 22:31
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Zero VGS posted:The hold up is someone else brought cash. Might even be less cash than asking, but a bird in the hand is worth two in the bush. I don't know how this works, what's the difference? Surely if you get a loan, the seller just gets the entire house price from the bank in the end, anyway so what's the functional difference? (also does the seller pay income tax on the difference between buying/selling price? Income tax on the entire thing? Capital gains tax? How does it work?
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Aug 16, 2020 01:52
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Reason it matters is cause you no longer involve a lender. Lenders tend to care about little things like - is this house actually worth what the buyer wants to pay - can this person pay back the loan - is the buyer some kind of scam artist who actually has no income at all so there’s a very real risk of the loan falling through. In an all cash offer none of that matters so it’s a lot more of a sure deal. Really sucks for those of us who don’t come from wealth who need loans though. You have no chance vs a cash offer.
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Aug 16, 2020 02:07
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redreader posted:I don't know how this works, what's the difference? Surely if you get a loan, the seller just gets the entire house price from the bank in the end, anyway so what's the functional difference? (also does the seller pay income tax on the difference between buying/selling price? Income tax on the entire thing? Capital gains tax? How does it work? Cash offers don't fail appraisal. In the USA you get an exemption of $250k/$500k (single/married) above your basis. The balance is capital gains tax. Basis is complicated and starts at the price purchased, plus any step ups (like if your parents die and give you the house in your estate), plus you may be able to add in the cost of improvements to your basis. That step-up is a HUGE gently caress you that means a massive amount of wealth is never taxed. Say you buy a house for $100k, die, give it to your kids and it's worth $1MM. Your kids sell it. They pay $0 in capital gains tax. That $900k in appreciation is never taxed.
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Aug 16, 2020 02:10
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quote:Really sucks for those of us who don’t come from wealth who need loans though. You have no chance vs a cash offer. Yep - a buyer with all cash is (1) likely offering at or near list-price in a normal market anyway, and (2) can typically close near-instantaneously compared to the loan / appraisal contingencies adding week(s) to the process and running the risk of the deal falling through. Out here, at least pre-virus, cash buyers also often came in higher than list with zero contingencies at all. A normal buyer with a loan straight up had no chance at all.
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Aug 16, 2020 02:11
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I’ve been involved in 5ish bidding wars in the past 2 years. In 3 of them an all cash offer was immediately accepted over all others with no chance of negotiation given. In one case it wasn’t even the highest offer - it was just the most attractive to this seller who valued the speed of closing. Going to be very happy to not be home hunting anymore. When we started looking it was hot but at this point it’s just miserable. Everyone is bidding too high cause low interest rates. Inventory was too low although that seems to be changing in my part of the world. I think people are moving out to the burbs (I live in a city) in droves cause in the past 2 weeks there’s been a lot going up for sale.
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Aug 16, 2020 02:19
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Thanks for all of the explanations. So basically: 1: when you pay all-cash and make an offer and you've signed <some contract or other> there's no chance that it will fall through because you have the money 2: when you pay all-cash it happens a lot faster Other than that, the seller still gets the same amount of money both ways? just, in one case, it might take an extra couple of weeks or something?
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Aug 16, 2020 02:21
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redreader posted:Thanks for all of the explanations. So basically: Generally, yes. There are some ways a mortgaged offer could be leveraged to get you to do more repairs because you really want to close the drat deal already but it's generally going to be nickel and dime stuff. In theory a cash offer could be slightly less than a mortgage offer absolute dollar value, but you may value your time more highly. Perhaps you are under contract elsewhere and need to close the deal no questions asked, would you accept $490k cash 15-day close w/ inspection (or no) contingencies or $500k with inspection, appraisal, and financing contingencies which take 30ish days and the last one isn't removed until day 27 at best?
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Aug 16, 2020 02:25
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Summit posted:Anyway what happened was they had showings scheduled and wanted to see the outcome of those. The outcome was a second offer. They then invited us to bid again. We did, but for less than they other people. However, because they liked our letter they with us! So another data point in favor of letters. My guess (which is worth nothing) is the agent was feeling cocky and wanted to see how much extra cash they could squeeze from the deal. With no second offer. When you held firm they just took the original money and gave you some plausible reason. But you didn't overbid and they took your (sounds like) fair market value offer so doesn't really matter. Sellers agents are real bastards.
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Aug 16, 2020 02:55
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There’s a bothersome lack of transparency in this process for sure. I have no idea if the other realtor was honest. Are they required to be? The whole thing feels scummy and like you got taken for a ride even when you win. I really do like our buyer realtor though. He stuck it out with us for 2+ years. We are very picky and wanted something pretty hard to find. He never pressured us to take a deal. At one point we even had an accepted offer but didn’t like what we found on inspection. He encouraged us to cancel, which we did. Pretty awesome dude and was always willing to talk shop and get into the weeds with examples of other deals he’s made. A far cry from the realtor we had on our first house who flat out refused to give us advice about anything for fear of violating some such regulations I never quite understood.
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Aug 16, 2020 04:19
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Summit posted:There’s a bothersome lack of transparency in this process for sure. I have no idea if the other realtor was honest. Are they required to be? The whole thing feels scummy and like you got taken for a ride even when you win. There's a reason why nothing is in writing until closing day Primary difference between used car salesmen and sellers agents is the total price value of the transaction
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Aug 16, 2020 04:21
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Summit posted:There’s a bothersome lack of transparency in this process for sure. I have no idea if the other realtor was honest. Are they required to be? The whole thing feels scummy and like you got taken for a ride even when you win. Sounds like you found a good one.
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Aug 16, 2020 05:02
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redreader posted:Thanks for all of the explanations. So basically: A lot of the cash buyers out there are investors who are experienced flippers and/or landlords. So they can literally walk up on Monday and say, "I'll give you 50/100k under asking but no contingencies, no inspections, no further negotiations and we can close this Friday." Someone getting a loan HAS to get certain inspections which will of course find something that they will ask you to fix or give them money off for and then you have to wait on the appraisal which could come in under at which point they will ask you to come down again and the process is going to take at least a month and at the end of it they could fail to qualify for the loan and you have to start all over.
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Aug 16, 2020 05:23
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I think in general people are way too quick to assume cash buyers are winning all the bids. Their bids are more attractive for sure, but when there are 10 bids for a house only one can win. 9 people will walk away saying "drat cash buyers" when in reality the problem is that only one bid can win. Assuming bids are equal every seller would of course take the cash offer, but a higher offer with a waived appraisal contingency is still more attractive if you can convince the seller you'll close.
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Aug 16, 2020 05:29
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therobit posted:they could fail to qualify for the loan and you have to start all over. I thought you had to get pre-approved for the loan!!? Does that mean they lost their job after pre-approval, or does not everyone do that, or ...?
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Aug 16, 2020 06:21
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Diva Cupcake posted:What’s the general consensus on escalator clauses in an offer? Assuming you meant escalation clause, these were in every one of our offers (Seattle) and when we finally won, the other offer just had a lower escalation clause. The offers were list up to $X in increments of 9K or list up to $Y in increments of 3.5K. Their only contingency was appraisal while we had none. My n=1 example is that it’s extremely common to offer escalation clauses in hot markets.
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Aug 16, 2020 06:22
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redreader posted:I thought you had to get pre-approved for the loan!!? Does that mean they lost their job after pre-approval, or does not everyone do that, or ...? Most people get pre-qualified, meaning the loan officer pulled their credit and asked them.their income and spit out a number based on that. They might make less than they said, they could lose their job, the taxes and insurance on the property could be higher, there could be something bad on the appraisal, the loan officer could have overlooked derogatory credit information that the underwriters caught, the underwriters might notice some suspicious deposits in the bank statements and the borrower is unable to document them. There are many things that can tank a loan.
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Aug 16, 2020 07:40
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redreader posted:I thought you had to get pre-approved for the loan!!? Does that mean they lost their job after pre-approval, or does not everyone do that, or ...? A pre-approval is no guarantee of approval. Pre-approval just means that they looked at your numbers and estimated a certain number that you can afford. Approval is going to be tied to the specific property, and they are going to do a deep dive into your finances. So maybe the property appraises at far less than your offer, for example, so they reject your loan (they are not going to approve a loan of 300k for a property that appraised at 200k) Or maybe it's a condo and when they looked into the association's finances they found out that the risk is too great. Or the HOA fees are so high that even though you qualify for the amount on the offer, they don't think you'd be able to afford mortgage plus HOA. Or maybe during the approval period they found a bunch of suspicious cash transactions that you can't explain, or you decided to finance a new car and your credit score changed. Or a lender decides to change their guidelines and now instead of asking for a minimum of 620 credit score, they want 650. Or you provided enough documentation for the pre-approval, but failed to provide the additional documentation for the approval... e:fb
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Aug 16, 2020 07:48
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joepinetree posted:Pre-approval just means that they looked at your numbers and estimated a certain number that you can afford. Approval is going to be tied to the specific property, and they are going to do a deep dive into your finances. You are describing a pre-qualification here, not a pre-approval.
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Aug 16, 2020 15:20
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Motronic posted:You are describing a pre-qualification here, not a pre-approval. Sorry, I was imprecise and I didn't mean numbers as in just looking at credit score,etc. My pre approval they asked for a couple of months of paystubs, statements, and a couple of years of taxes, but they just looked at it and asked no questions or anything (which I was trying to say as "looking at the numbers"). When it came to actual approval, I then had to explain things as small as a 50 dollar deposit. The approval was much more thorough than the pre-approval (on top of being tied to a specific property at that point). joepinetree fucked around with this message at 16:03 on Aug 16, 2020 |
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Aug 16, 2020 15:58
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joepinetree posted:Sorry, I was imprecise and I didn't mean numbers as in just looking at credit score,etc. LOL a $50 deposit? HA HA baby undetwrited's first day poo poo here or something. "I'm worried this customer is selling dime bags reeeeeeaaaaaly slowly."
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Aug 16, 2020 16:33
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Underwiter had a question about a random $3400 deposit, my wife wrote them a letter to the effect of, "gently caress if I know, that was two months ago, I don't remember" and they accepted it as long as it was signed Might have had more scrutiny if it were a raw cash deposit, I dunno
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Aug 17, 2020 01:22
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Closing on Tuesday, but sending the wire to the title company tomorrow. Hard to know how financially foolish this decision will be. The future of the housing market seems especially uncertain at the moment and very location specific. I was never a house buying person to begin with, but my wife won. So we are now putting an insane amount of time/money into a single purchase during a loving pandemic and potential financial crisis.  Maybe asset inflation and low rates will save me?
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Aug 17, 2020 05:13
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Do I need a new real estate agent? Maybe I still don't exactly understand what they are supposed to be doing since I'm looking to buy my first home, but I feel like they aren't very helpful. They came recommended by the mortgage broker I was working with, and all they really did after the "hi nice to meet you" chat was take my maximum price limits and the zip codes of where I initially started looking for and put them into some automated RMLS thing so I get emails as listings pop up. Except, I get maybe three emails a day from that, meanwhile I get dozens of Redfin emails a day covering the exact same areas. I email them the redfin listing with some questions and they usually just forward me the RMLS listing for the site which has exactly the same info as Redfin's listing except it has their company name at the top of the report. I'll ask some questions and then by the time we do all that the listing gets updated to pending and I start over the next night looking to see what else pops up on the Redfin search map. I guess I thought I would give them a big list of things I am/am not interested in, and they would use that to start sending me things I should be looking at.
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Aug 17, 2020 06:06
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also why do like 90% of listings have mirrors over the fireplace? I've never seen anyone put a mirror over a fireplace anyplace ever in my life.
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Aug 17, 2020 06:11
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I’ve never understood the TV over a fireplace thing. Or tiny balconies.
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Aug 17, 2020 06:26
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Vice President posted:Do I need a new real estate agent? Maybe I still don't exactly understand what they are supposed to be doing since I'm looking to buy my first home, but I feel like they aren't very helpful. They came recommended by the mortgage broker I was working with, and all they really did after the "hi nice to meet you" chat was take my maximum price limits and the zip codes of where I initially started looking for and put them into some automated RMLS thing so I get emails as listings pop up. Except, I get maybe three emails a day from that, meanwhile I get dozens of Redfin emails a day covering the exact same areas. I email them the redfin listing with some questions and they usually just forward me the RMLS listing for the site which has exactly the same info as Redfin's listing except it has their company name at the top of the report. I'll ask some questions and then by the time we do all that the listing gets updated to pending and I start over the next night looking to see what else pops up on the Redfin search map. Depends on what you want out of a realtor. If you really want to look yourself I’ve had good luck using Redfin directly. You can book tours directly on their site, choose a time to tour, and whatever agent is available will open the house for you. They kick back some money to you after the sale so they are a bit cheaper too. Realtors don’t have special hidden data (except price history) so there’s no reason you can’t choose your own houses to tour. In fact I greatly prefer it because I don’t like wasting time touring houses I could have easily filtered from the listing. I am also paranoid a listing could get filtered by the agent that I would have wanted to see. After 10ish house tours via online booking we met a realtor a few times (again it’s random who you’ll get at these) that really clicked with us. I don’t know if it’s required but Redfin has an option to name a specific realtor as your official contact, so we added him. He’s been our primary contact when we got serious and started making offers. He showed up more often to the tours after that but if he wasn’t available it was fine cause any Redfin realtor can step in. Pretty cool system if you just want to search for yourself.
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Aug 17, 2020 13:26
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Gabriel S. posted:I’ve never understood the TV over a fireplace thing. Or tiny balconies. Fireplaces are often positioned as the centerpiece of a room, the logical place for the furniture/seating to point towards. Does that also sound like where one might want to put a TV?
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Aug 17, 2020 16:52
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I bought a house without a fireplace and have 0 regrets. It makes decorating so much easier. Tiny balconies are for smokers who don't want to get (as much) smoke in the house.
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Aug 17, 2020 16:55
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I have a mirror over one of my fireplaces and a tv over the other  Although only one fireplace works and the other is a convenient way of transferring mice into the house for my cat to eat
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Aug 17, 2020 17:04
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GoGoGadgetChris posted:I have a mirror over one of my fireplaces and a tv over the other Go outside and look for a hole at the base of the chimney. This is your ash hole. Jam something in there really tight.
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Aug 17, 2020 17:13
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Motronic posted:Fireplaces are often positioned as the centerpiece of a room, the logical place for the furniture/seating to point towards. Does that also sound like where one might want to put a TV? Ergonomically speaking, the TV should be at eye level when you're in a seated position. It's all good and well if the living room is large enough, but if the distance between your seat and the TV is small enough to require that you crank your neck more than 35 degrees to watch TV, you're going to have a bad time.
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Aug 17, 2020 17:20
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Summit posted:Depends on what you want out of a realtor. If you really want to look yourself I’ve had good luck using Redfin directly. You can book tours directly on their site, choose a time to tour, and whatever agent is available will open the house for you. They kick back some money to you after the sale so they are a bit cheaper too. Realtors don’t have special hidden data (except price history) so there’s no reason you can’t choose your own houses to tour. In fact I greatly prefer it because I don’t like wasting time touring houses I could have easily filtered from the listing. I am also paranoid a listing could get filtered by the agent that I would have wanted to see. For what it's worth my Redfin agent was the same start to finish - 18 months. She showed up to my first showing to give me the spiel on how Redfin operates. Many of my showings were done with associate agents, but I never spoke with another "real" agent. @Vice President, your agent doesn't sound great but you really should be more hands-on in my opinion. Your agent cannot be as invested in this process as you are, and you're not going to be happy if you expect them to point you at houses. You are doing the shopping and your agent is the tool that allows you in the door and helps you negotiate when you've found what you want. They may be able to offer advice on things you should look for, pricing, and so on, but that advice is often not that great. When a house pops up on Redfin that you like you need to be on your agent's rear end about seeing it ASAP. The agent will also be able to get you the seller's disclosure prior to any showings. If you really have no idea what you want you would normally set up a series of like 5 showings of various quality properties to figure out what you want. That's really hard to do in this market because anything worth buying is going under contract too quickly. Edit to add: It's also possible your agent isn't giving you attention because they don't think you're serious about buying. Remember, they only get paid if you close so they aren't going to be motivated to help you find a house unless they're convinced you'll buy it. Andy Dufresne fucked around with this message at 17:24 on Aug 17, 2020 |
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Aug 17, 2020 17:21
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therobit posted:This is your ash hole. Jam something in there really tight. Whoa dude this is a family thread
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Aug 17, 2020 17:52
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Bioshuffle posted:Ergonomically speaking, the TV should be at eye level when you're in a seated position. It's all good and well if the living room is large enough, but if the distance between your seat and the TV is small enough to require that you crank your neck more than 35 degrees to watch TV, you're going to have a bad time. While of course that's true, there's the mentioned room size thing as well as the height of the mantle/tv. It shouldn't be a default "always put a tv there", but it's a logical place that often works just fine without having to make some odd choices about what direction furniture faces. Also, some people just don't watch all that much TV to find this problematic.
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Aug 17, 2020 18:31
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