Let’s Learn Finance: Buying A House

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Okay, so the next 30 years of my life are signed away, now what. Ali and I just bought a house. That sentence is still sinking in as we continue to unpack our boxes, but it gets more and more real the closer we get to paying that first mortgage payment.

We are excited about being in a house that we can enjoy with our future family, but that excitement definitely came with some frustration, stress, and lots of learning along the way. So I want to pass along that information to you, before it leaves my mind and I have to start focusing on cutting the grass.

The first part of buying a home is figuring out your budget, and saving for a down payment. There are some unique ways you can put down very little money in order to get a mortgage but what’s important is that you can afford the monthly payments. You can ask your realtor some of your options, and that gets us to the next step.

You definitely want to work with a realtor. I’ll give a shout out to ours here in Richmond, Tommy Sibiga helped us out a ton. Working with someone you trust and will give you an honest opinion is important. We started looking at houses online a long time before we stumbled upon Our house, but having a realtor allows you to go look at ones that pique your interest.

This process can be long and tiring or really fast and easy, but usually is both mixed together at different times. When we finally found the house that we both wanted to put an offer on after many months of looking, we had to move pretty fast to put an offer on it.

Working with your realtor and getting preapproved helps this step a ton. You can go through a local mortgage company, as we did, or you can go to one of the big banks too, and it usually just involves telling someone your income and basic financial situation so that they can give your realtor a letter that says its okay for you to buy a house of XX value.

When you finally decide to put an offer on a house a lot of different things should be considered. Whether or not there are other offers on the table, whether or not the house has been listed for a while, when you actually want to close on the house.

But once you make an offer and the seller decides to go with yours, there is a lot more that actually has to happen.

Your realtor should give you some guidelines of what needs to get done over the next couple weeks. But one of the first things that needs to happen is a home inspection. Having a reputable company take a look at your house is important to know all the quirks and potential fixes that need to happen.

After this comes the shopping around for two things. The first usually is who you are going to use to get your mortgage and this deserves an entirely separate post about mortgages that I will do in the future. But mainly you should be looking for the best price for your mortgage, meaning your interest rate and monthly payment.

The second thing that you will have to shop around for is home insurance. And this will also take some comparing, but you should factor in price as well as coverage and how well you are protected in the case of emergencies.

After you’ve finalized these things there are only a couple more steps towards actually closing. Getting an attorney to walk you through and represent you in the buying process is essential, and again should be someone you can trust to point out obvious red flags.

Once an appraisal has been completed and you’ve gathered and sent many many financial documents to your mortgage company you can walk into your closing meeting confidently.

In summary these are the main phases:

  1. Save up/budgeting
  2. Realtor/looking for houses
  3. Make an offer/Getting inspection
  4. Mortgage/Insurance shopping
  5. Document gathering
  6. Closing/with attorney

I hope that this general step by step guide is helpful, and like I said I will hopefully do some individual posts to explain the details of this process even further in the future.

Buying a house is exciting, but if you don’t know what you are getting yourself into or feel overwhelmed with information, just know that there are plenty of resources out there and people willing to help.

Ali and I are so blessed to now own a house, but we’ll talk to you in 30 years about how to pay off all that debt. Happy buying.

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2 thoughts on “Let’s Learn Finance: Buying A House

  1. Evan,

    Good article. A couple more ideas you can talk about in future posts.

    How to determine your monthly payment that is best for you. I like Dave Ramsey’s formula which is house payment should be no more then 25% of take home pay. Also there are good articles that cover differences between 15 and 30 yr mortgages.

    I love the idea of income properties where you can rent the basement or a second floor so your out of pocket is reduced if not zero. As a first house this is a great way build passive income.

    Also Kim and I were able to sign up for free through our mortgage company to auto pay every 2 weeks and it will pay off our mortgage 5 1/2 years earlier. Just simply by paying 1/2 a payment 2 weeks early each month.

    Finally Sarah is now a full time real estate agent so maybe the two of you can exchange blog post ideas and and promote each other.

    Enthusiastically,

    Michael Moog 865-310-0288

    From: “This is Real Life.” Reply-To: “This is Real Life.” Date: Tuesday, March 28, 2017 at 8:26 AM To: Michael Moog Subject: [New post] Let’s Learn Finance: Buying A House

    WordPress.com evmoog posted: ” Okay, so the next 30 years of my life are signed away, now what. Ali and I just bought a house. That sentence is still sinking in as we haven’t moved in yet, but it gets more and more real the closer we get to paying that first mortgage payment. We are”

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