Seven Obstacles for a First-Time Home Buyer
As a first-time home buyer, I cannot help but wonder how normal people undergo the stress of purchasing a house and remain sane.
To buy a home, I count no less than seven separate obstacles that can sabotage even the best laid plans of the most meticulous consumer.
The moment you decide to search for a new home, real estate agents will shove their way into your life with ferocity.
At first, I sought the help of experienced agents when visiting open houses. With faces aglow, they hailed my decision to buy and launched a barrage of questions, while dishing out business cards and dispensing stale advice. I heard the same lines over and over, “A second bathroom will increase resale value” and “Be careful of streets lined with RVs.”
After spending three afternoons with three seasoned agents, I concluded that these well-intentioned salespeople were a waste of time. They showed me homes that did not fit my needs, drove in confused circles while unfolding a series of street maps, and talked incessantly of their big sales in faraway neighborhoods (reminding me of the fisherman who brags about his giant catch).
Finally, I decided to search on my own. The next obstacle introduced itself once I found the townhome that would, two months later, be mine.
The “For Sale by Owner” sign in the front window caught my attention, and after a two-hour chat with the seller, I knew I wanted to make an offer.
After exchanging officially worded counteroffers, the seller and I settled on a purchase price, only to dicker over such matters as who would pay the transfer tax and who would choose the termite inspector.
In retrospect, I find it amusing that after agreeing to spend tens of thousands of dollars, I could have come so close to canceling the whole deal over a $50 fee.
Obstacle No. 3 enters the picture after you make the decision to buy. At that point you become a virtual employment service, hiring an escrow officer, a lender, a home inspector, pest inspector, appraiser and assorted other players who get paid for reasons that escape me.
Keep in mind that once you enter escrow, every day counts. If an appraiser fails to show for an appointment, if a lender proves suddenly recalcitrant, if an inspector refuses to return calls, you are left adrift in a sea of murky contracts and financial commitments.
You may see yourself as a good organizer or an excellent personnel manager, but until you interview, hire and monitor the work of all these people, you have yet to truly scale the Mt. Everest of escrow.
But within Obstacle 3 lurks Obstacle 4. The lender can (and probably will) impose all kinds of crazy conditions on granting you a loan. My bank initially courted me with enthusiasm. They congratulated me on prequalifying for the loan and secured a competitive interest rate when I gave them the thumbs-up.
Yet once escrow began, so did the lender’s strange and increasingly random demands: Explain every large deposit in your bank account over the last year. Document in detail all the reasons why you moved from New York to California. Sign your name three ways: with middle initial, without middle initial, and with your nickname. Oh, we forgot, you must sign and return these ten forms by 4 today or no loan. . . .
I realize that careful underwriting allows lenders to run a profitable business. They need to ask questions about an applicant’s job, assets and credit history. But the process takes on a life all its own, as if some paranoid bureaucrat is so afraid of making a bad loan that to end the interrogation signals defeat.
Perhaps there is an unwritten rule that a bank cannot finalize your loan until their file on you reaches three inches high.
Obstacle No. 5, otherwise known as the Mystery of the Fees, requires a blind leap of faith.
To buy a home, you must pay thousands of dollars in closing costs. You must learn a whole new vocabulary of points, origination fees and prepayment penalties.
To overcome this barrier, you must stop worrying about money. You must view your dwindling bank account as an abstraction, like an oil painting hanging in a museum, and detach yourself from the whole mess.
Prepare yourself for an “appraisal fee” (pays for someone who spends 20 minutes fiddling with a tape measure to tell you what you already know: you are paying a reasonable price, a hefty “processing fee” (pays for . . . you got me) and vaguely annoying “discount points” (where’s the discount?).
On the positive side, you may find it liberating to toss money away with total abandon. Today I laugh when recalling all those silly fees, and I do not fret as much over where and how to spend my money.
After completing the escrow experience, you will never feel quite as attached to money as you once did. Consider this free therapy.
In an age of stress management seminars, the next obstacle is a sign of the times: worry control. If you are the anxious sort, you will just love buying a home.
Each day, with every ring of the phone, bad news threatens to explode in your face. Will the sellers change their mind? Will the appraisal reflect the price you paid? Will the bug inspector find a nest of rodents residing under the toilet? Will the place burn down the very day your title is recorded?
Lastly, if you conquer these six obstacles, then the final test seems almost anticlimactic. Call it The Move.
To orchestrate the arrival of all your belongings on the desired date takes a mix of planning and sheer luck. Watch for movers who scrape the legs of your desk along your freshly painted walls. And wipe those feet before you soil your new carpet.
Although my move proved relatively smooth, the coup de grace came when my escrow officer sent over a bottle of wine with a red ribbon around it. She told me my case was a breeze, and she wished that all her deals were so easy. I guess that means it’s all over.
