Project list

There's a lot of stuff that I want to do with the house. Here's a short project list of stuff I'd like to get done sooner rather than later:

1) The backyard needs a lot of work. These a few feet of uneven brick laid, and then clay/dirt with a few weeds and not much other growth.

2) The gutter on the back of the kitchen needs some work and/or cleaning. Not all water is being diverted to the downspout.

3) At least one window needs to be replaced. This one has a crack in the top half.

4) There's a weird space in between two cabinets in the kitchen. There's wood paneling over what is really otherwise empty space. I'd like to do something nice and/or useful with this space. I also can't fit my trash can under the sink because of the way the plumbing is set up. I'd like to find a solution for this, which probably just means buying a smaller trash can.

5) The hot water heater is kind of old, and huge (80 gal). I think a new energy star one around 40 gal would be great and pay itself off within a few years. The fridge is also old, 1992, and using this calculator from the department of energy, I found out that a new fridge would easily pay for itself within five years with the energy it saves. The difference is roughly $133 to $43 per year.

6) The front of the house has a great facade, but could use power washing. The handrail in front isn't totally secure. I need to replace the light bulb out front. The decorative capping at the top of the house desperately needs to be repainted. This stuff is low on the priority list and I will probably get around to it when I also get the furnace replaced and the chimney capped.

7) I'd like to get rid of most of the white walls in the house. The painting projects are ongoing.

8) The front room doesn't have any overhead lights. One idea is to place some nice track lights above the front door. There's an outlet near the ceiling, but sadly, it's not controlled by the light switch. There is an extra light switch by the front door, and it controls one of the outlets in the room. I'd really like to put a ceiling fan with lights in this room, but I'm not sure how much work this would take. There's also a motion sensor and siren installed for the security system. I don't really like them, but I will probably leave them up for the time being.

9) In addition to being ugly, the kitchen floor has a few gashes that are covered by an ugly Ikea rug. It did a good job of hiding them every time I walked through the house though; I never thought to look under it. I'd like to replace the flooring at some point.

10) There are two weird spaces in my bathroom. I'd like to convert one into a linen closet, but I'm somewhat at a loss on how to best use the available space.

Homebuying week 10

House things have been going crazy this week. As much as everyone seemed to be pushing for an early closing, it's not going to happen. I initially thought I could close April 17, then hoped for today, and am now looking at April 30; but this date seems firm.

Over the last few weeks I have been working on some grant applications. Largely due to ignorance on my part, I may have invalidated some of these grants. The lender and title company are very involved in the grant process. I thought I just showed up ready to close and it didn't matter where the money came from, whether 100% from me, or 50% me and 50% grants, ect. Not true. Also, the bank was slow with everything, and two grants needed a settlement notice to finish processing, which I didn't get until this week. Still, the ultimate responsibility falls to me.

So, Wednesday when I found out that there was a lack of information about the grants for the title company and the bank, things blew up. I sent 27 emails over the course of the day, in addition to a bunch of phone calls, about house related things.

I still am unsure if I am going to be eligible for all of the grants. The good news is that the house stuff, aside from what I've said above, seems to be moving. Still, settlement on April 30th could get really crazy, and probably will if the last week and month are any indication of my luck in the homebuying process. Best part: Jonny and I have a lease that ends April 30th, so if settlement gets pushed, things will get quite interesting.

House and Dog

I have been visiting the SPCA in the past few weeks in the hopes of getting a dog, and I finally went through with it last week. I adopted a 7 month Siberian husky/pit bull mix and changed his name from Ethan Zachary to Crosby.

He is working on the house training. He hasn't barked since I got him, and he hasn't chewed anything either. He's loves the ladies, and I think I totally won the doggy lottery.

I've always loved playing with my friends' dogs, and finally getting into my own home means that I don't have to deal with any restrictions of landlords and leases. I'm trying to enjoy all of the perks.

On the house front, the appraiser has been back to inspect the repairs and has submitted the final report. I am still working on two grant applications. I am hoping to close on Friday and will find out by the end of the day.

Homebuying week 8

It's been a long time since I've updated on the housing process. That's largely because there hasn't been much going on. About a month ago, I received a large packet in the mail from the bank that had the best rates and fees for me, which was TD bank. It included a conditional approval to loan, and the next month consisted of compiling and faxing a lot of documents to the loan processor. These included things like bank statement, paystubs, addendums to the agreement, employment verification, canceled checks, and a lot of other boring things. The bank also was much slower in correspondence and processing everything than I was used to, and that's why it took roughly 5 weeks to get to a point where the bank was okay with giving me 100,000 plus dollars.

While doing all of this work for the bank, I checked interest rates daily. they were hovering around 5.25% for about two weeks, with slight changes up and down. I was holding out for a 5.0% rate, but also understood that rates could go up and stay up at any time. Then, suddenly rates bottomed out one day (March 19). I scrambled to get all my paperwork in and locked the rate in at 4.99%. The rates stayed there for one more day, and then went back, and stayed, to where they've been for most of the year. Patience=win.

Also during this time, the bank schedule the appraisal. An appraisal is like a home inspection for the bank; it focuses more on the value of the property as an investment for the bank. The appraisal came in slightly higher than the price I am paying, which is great. Further, the calculation on the square footage was 1248, as opposed to the 1090 that was advertised on the listing for the house. It's just another way that I feel I got a great deal.

On Tuesday, the bank gave me a call and finally told me that I am approved for a loan. There are still a few small conditions, but they are things that are not problem to finish up between now and closing.

They was some miscommunication on my part about the closing date. I've been thinking it was April 17th, but it's slated for the 30th. I called the bank to see if it could moved up. They said yes, but I'm still in a holding pattern. The seller needs to complete (start) the repairs agreed upon in the addendum sent over after the inspection. Once this is done, the appraiser needs to get back out there and verify, and then the bank, and everyone else, is ready to go. I don't think we'll make it for the 17th, but I'm hopeful for the week after, possibly April 24.

Agrement of Sales Addedum

After the inspection, I wanted to make add a few repairs to the agreement of sale so that they would be fixed before the house was in my hands. Unless a house is being sold as-is, this is a pretty standard procedure.

The biggest problem from the inspection was the furnace. Replacing it and the chimney meant I was looking at least $3100 in repairs. With that knowledge and Jeff's guidance, we crafted a addendum asking for the the following:

A fiberglass coating on the upper roof to strengthen and extend its life
Ungrounded outlets to be grounded
Small leak fixed in bathroom
PVC sewage vent pipe extended to top of roof (to get rid of poopy smells)
Replace two windows in poor condition
Cap and seal all windows on rear of house
Repair masonry joist pockets in basement
Settle accounts with PGW and restore gas service before settlement
$2,500 credit towards furnace replacement and chimney repair

Long story short: I got everything except the two windows replaced. The house isn't perfect, but I feel like I'm getting a lot fixed even before I move in. I still have some things that I need to work on over the next few months when I get in, but I've successfully passed another hurdle in the whole process.

Next up: Securing a commitment to loan from the bank, and getting an appraisal that meets or exceeds the sale price.

House Inspection

This week has been a whirlwind so far. I've been feeling like stuff I normally enjoy doing has been taking more than a normal amount of effort. It's not fun to feel that way, and it's the reason I haven't written about my home inspection yet, but here goes:

I showed up at the property around 4:30 and met Jeff, Reid from US Inspect, and the seller's agent Tim. I also met Rod, the owner, but he didn't stick around for long. Reid was a great inspector and I would recommend him to anyone. The inspection itself went pretty well. It was a three hour intense investigation of everything that is wrong with the house, and that can seem pretty daunting.

Jeff told me that it went really well, and he has a lot of other inspection to use as comparison. Personally, I just felt like there was a huge list of problems with the place; a lot of minor things that I'm willing to overlook, and a few major things that need to be fixed.

Here are the major things: The chimney and furnace do not look good. The solution to solve both of these problems involves sealing off the chimney and installing a high efficiency heating system that doesn't use a chimney. It's a great solution, and I'd love to have a nice, efficient furnace, but it's also expensive.

The roof is getting old, and will have to be replace in the next few years. That's fine, but it immediately needs a silver coating to prevent leaks and extend the life a bit more.

There are some gaps between the joists where they meet the wall where I can see crumbling brick, and at one point, into the neighbor's kitchen. That's a major issue, but a relatively easy fix.

That's the big, bad stuff. Little bad stuff involves replacing some mortar, capping some window frames, repairing or replacing a few windows, a few ungrounded outlets, a small leak in the bathroom sink, and some siding damage.

And now good news: Structurally, all walls are solid. There is new electric service and it looks good. No termites. Everything in the kitchen works. I met two of the neighbors, and they seem really nice too. I'm sure I'll write about them more in the future. I'm starting to get attached to this place.

A few hours after the inspection, Reid sent out a detailed 24 page report that includes all of the problems, suggested repairs and costs, and pictures. It was a great part of the home buying process and really made me understand the place that I am looking to buy. Nothing came up in the inspection that is too big of a problem to fix.

Jeff and I are going to work on a letter that is a revised offer in light of the inspection results. I'm going to ask for a credit towards the purchase of a new furnace and that a few other repairs take place. More info as it comes in.

Housebuying: Mortgage application

This house stuff is moving rapidly, and it's also taking a lot of work. I want to blog about every step of the process to refer to a friend in the future or to personally look back upon. I'm trying to keep up.

Once my bid was accepted, I needed to get moving with a bank. My settlement schedule is based on a 45 day timeline, so I don't have much downtime at any point of this process. I am working with two different mortgage bankers because I want them to be competitive with each other. Before looking for a house, I contacted both of them to get a pre-approval, which was a pretty easy process. Now I need to get the more difficult, and serious, commitment to lend.

I spent some time yesterday giving all of my details to the two different lenders. Here are some things I am learning: When talking about interest rates, they have to be at zero points to compare them. I don't want to explain the whole idea, but I was quoted 5.375 at 1.5 points or 5.5 at zero points. Essentially, when you calculate it, the 5.375 becomes and is equal to 6.0 at zero points. So the 5.5 rate is much better.

Again, credit score is so important. I might not qualify for the type of mortgage that I want. Not becuase I have "bad" credit, but just because I don't have enough good credit. Seriously, if you are reading this and don't have a credit card in your name, go get one and start using it. Pay the balance in full and on time, and don't charge more the 50% of the total limit. I'll even help you find a good card. Seriously.

The actual mortgage application was pretty easy, both lenders walked me through it. Now I am waiting to for them to evaluate everything and get back to me. Becuase of the current economy, underwriting guidelines have become important to my situation. Most mortgages are sold and do not stay with the intial lender for the lifetime of the loan (30 years in my case). To sell a loan, it has to meet Fannie Mae and Freddie Mac underwriting guidelines, which have become strigent in the last few months. In the end, I am going to get a much better deal from a bank that is not going to try and sell my mortgage right away. TD Bank seems to be willing to do that. The reason this makes such a difference is because if they decide to underwrite it in a few years, my credit will be much better and more established, making mortgage easy to conform to the guidelines. Currently, if my mortgage was underwriten, I would be offered 6% at zero points, which isn't very competitive.

All of the above is based on my understanding, and may be inacurate. It might not even be coherent. But that's where I am. Waiting to hear back from the banks. Next step is my home inspection. Because banks will not lend me money if I'm not investing in a good house.

The agreement and the bid

I found a place that I want to buy. I made my decision on Saturday and gave Jeff a call. We made plans to meet the next morning and draft an agreement of sale.

Because Jeff is such a great agent, everything seemed really easy. We spent a few hours filling out all of the necessary paper work, culminating in the 23 page agreement of sale. It's basically a highly specified play by play of the deal and its terms.


All of this was completed before we even talked about money. The buyer's agent was upfront that there are quite a few other people looking at the property, and Jeff told me that there may even be another offer on the table. With this knowledge, Jeff advised (and I agreed) that we should go with a strong offer. I offered close to the asking price, and still feel really good about my offer. I also recognize that the current asking price is already about $6,000 less than it was initially listed for.

With the agreement, I put down $1000 as a "good faith" deposit, which is refundable if the deal doesn't go through, and goes toward the price if it does. After Jeff scanned everything in and sent it over to the buyer's agent, and I received a seller's disclosure. It's a list of everything they know about the property, and from what it says, there are no known problems, which is great news.

Everything was a lot of work, but now that I'm writing about it, it seemed pretty easy. Today should be the day they respond to my offer. They could say yes, which is ideal. They can flat out say no, or negotiate. It's a waiting game, and I feel good...

Housebuying...week 3?!?

I can't believe I only started the house search (about) three weeks ago. Thursday night I went out with Jeff again. This was by far our best session together. I am really honing in on what I am looking for. I only needed a few minutes in some places to know that they weren't right for me. The best part of the night was 2521 Emerald Street. It seemed to have everything that I was looking for in a house. On top of that, it was in my price range.

Friday was a day of serious thinking. I knew that the house on Emerald St. was great, and that a lot of other people were looking at it. But I kept asking myself "is it the one for me?" For a full day, I really thought hard. John Mallinen passed on some good advice to me, "When you're buying a house, you get to a point where you just have to close your eyes and jump." Conventionally, it might sound like bad advice, but it was what I needed to hear. Naturally, I also had a lot of doubts and reservations that I was thinking about on my own. That's why I mostly needed the people around me to be positive and encouraging.

My mom recommended that I look at the house one or two more times before I made my bid. Because this means coordinating schedules between myself, two agents, and a tenant, I didn't think I had time to do that before other bids came in. Luckily, I was walking by on Saturday with Jonny and Kashi and the women staying there was coming out and was more than happy to let Jonny and I have a look around. Seeing it again was good, unexpected, and made me sure I wanted to go for it.

This post is long, so more on the story later.

Homebuying: Week 2

This weekend I went out and looked at another batch of houses.  I think I've seen seven now.  Because of my price range, there is always going to be something that I don't like about a house.  Here are some of the problems with the houses I am looking at:

1) Lack of yard.  Houses that were really small, and then expanded, had only one place to build into: the already small backyard.  I'd really like to have some space behind my house.

2) Questionable Location.  From where I live now, it only takes a few blocks to get into an area that I don't particularly to live in.  Location is an important consideration to me.  For starters, I want to live on a nice block and be close to public transportation.

3) Poor Layout.  One house I looked at was kind of perfect, except for the weird floor plan.  Of the three rooms advertised as "bedrooms" only one was a normal sized, functional bedroom. And I'm not trying to buy a one bedroom house right now.

4)  Kitchen.  I'm too picky here.  I want a big kitchen.  I want to be able to make delicious meals.   I want space to be able to put in a dishwasher and indoor grill.  All of those things are impossible to come by.  I'm looking for the a kitchen with at least that potential.

5) Condition.  Here's a huge problem for me.  I want a house that is mostly in good condition that I can put the finishing touches on.  But the are two prevalent types of houses:  terrible condition with a lot of (serious or cosmetic) work needed; or, houses that have been rehabbed in a quick, cheap fashion.  I will end up redoing this shoddy work, but also will pay for it up front.

My top pick so far is at Firth and Amber.  I want to go back and take pictures and measurements of this house.  Time is on my side right now; I am happy renting at my current location for about about another six months if I don't find a house to buy right away.  Still, the housing market is pretty slow, and I'm not sure how many new places are going to come on the market between now and then.

Homebuying: Week 1

Last week, I got down to business and started thinking seriously about going through the home buying process.  I called a realtor and a mortgage banker and began to do the real work.  Here are some results:

The Realtor:  Jeff Carpineta.  I've heard from various friends that Jeff is "the man."  After meeting with him for a couple of hours on Friday morning, I have to agree.  After talking with him, it's easy to understand why a dozen or more of my friends have worked with and recommend him.  Jeff and I met at the Rocket Cat and he gave me the basic overview of the home buying process.  He wants his clients to be educate before they begin anything, which I respect.  I learned a lot: where money comes from, how to find a good home, the relationship between buyers, sellers, banks, and realtors, ect.  Jeff was also willing to show me houses before I was pre-qualified, which is rare.  He's incredibly optimistic, and believes that if you can get approved and gather a mere 3.5% of the purchase price, you can buy a home.  Lastly, Jeff is motivated; he thinks that I can be through this process in two months.

The Mortgage Banker: I've talked to two different people on recommendations.  I'm glad that I went to more than one person because my second pre-approval was a $10,000 increase over the first.  The second person I talked to seemed to be pretty knowledgeable of city and federal programs that will allow me to get a lower interest rate.  I'll talk more about this person as he/she become more important down the road.  At this point, the mortgage banker has approved me for the price range that I am ideally looking at, which is perfect.

Things I've learned so far.  

1) When talking about interest rates, it should be at zero points. That way, you are able to make a more accurate comparison.  

2) Credit scores are annoyingly important.  I had one account go to collections four years ago that is bringing down my score. Pay your bills on time. 

3) Talk to as many people as you need to until you find someone that makes you comfortable.  This is a huge decision and process; you want to go through it with someone you like. 

4) This weekend a $8,000 refundable tax credit was passed as part of the stimulus bill for first time homebuyers.  That means that if I buy a home before Nov 30 of this year, I'll have a big fat tax refund come April 2010.

I could write more, but I want to keep these posts manageable.  I hope to keep doing updates each week as I make progress, learn more, and take steps closer to becoming a homeowner.