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The Do’s and Don’ts of Buying a New House While Working Full-Time

movingday.flickrSo you’re tired of your little old lady landlord losing your rent check. And your frat boy neighbors were fun three years ago, but now their mid-week keg parties are keeping you awake.

You’ve got the money saved to buy your first home, but there’s one problem: You’re crazy busy. Like eyes-popping-out-of-your-head, I-don’t-have-a-spare-second busy. And the mere thought of enduring the steps involved in buying a house spikes your anxiety level through the roof.

But you want to do it anyway. You’re ready to a buy a home. Congrats. Now, as Samuel L. Jackson said in Jurassic Park: “Hold on to your butts!”

Buying a home involves numerous steps that can take months and eat up countless hours of your time. In a perfect world, you could devote days to viewing dozens of homes, shopping your mortgage and negotiating your offers. In reality, you have to find the right house in between deadlines.

No problem; it can be done. As a wife, mom, and real estate broker, let me help you navigate through some steps to buying a house in this crazy market.

Here’s how every working person should approach buying a home:

DO get pre-approved ASAP.

Before you hop onto Zillow or Trulia and find beautiful houses that are already in escrow or sold (but still listed as active), gather your paperwork such as tax returns and pay stubs. Submit all the required documents to a lender and get your mortgage pre-approval.

I cannot stress enough how important this first step is. Not only does the pre-approval letter show you what loan amount you qualify for, but it’s impossible to submit purchase offers without your loan pre-approval (unless you are paying all cash). So any home searching prior to getting your letter, especially in this market where things are gone in a heartbeat, is essentially a waste of time. And time is not something most homebuyers have a ton of.

DO find a trusted buyer’s agent.

The best place to find a real estate agent or broker is a recommendation from a friend or family member. There are tons of them out there, so a quick interview with the agent and questions like, “How many transactions do you close each month?” and “How long have you been in the business?” can help you narrow down the options.

Your real estate agent will set you up to receive automatic emails from the Multiple Listing Service (MLS) with pictures and information about houses that match your criteria. Once you review the information and think you might like a particular place, it’s time to get out and see. Checking emails with new listings is easy, but coordinating showing times can be tough for couples who work full time and even tougher if you also have little kids.

DON’T only view houses at night.

Although it can be impossible to dash out of work to see a house, I don’t like to show houses to my clients at night. There can be safety issues, but most importantly when you see a house in the dark it’s easy to miss something about the house or the neighborhood that could be a big red flag. Yes, I do recommend checking out the neighborhood at night before you buy, but not only at night. Weekend open houses are good opportunities for those who work 9-5 and can be fun for kids too, especially when there are balloons and refreshments, but they aren’t always scheduled for the homes you want to see.

DO thorough due diligence before scheduling showings.

If there are no scheduled open houses for the listing you want to see, your next bet is to screen it as much as possible before actually going to see it (make sure the area is big enough for your goals, look at all the pictures thoroughly, research neighborhood crime rates, etc). Then try to schedule an early morning showing just before work or early evening right when you get off of work. I’ve had clients take a vacation day off of work so that we could see house after house after house. Although this is exhausting and not recommended when you are bringing along kids, it’s one way to get it done. The bottom line is the more carefully you can filter out homes that don’t meet your criteria, the more likely you are to find “the one” in fewer showings.

DO prepare for piles of paperwork.

Gone are the days of writing up one offer and getting it accepted instantly. In many parts of the country right now, there is a low inventory of houses compared to the number of buyers. So be prepared to make multiple offers. According to Bloomberg Businessweek, “In the 19 major markets in February [2013], more than a third of houses sold within two weeks of being listed … This is the housing equivalent of ‘flying off the shelves.’”

Don’t get discouraged if you get even your first five offers rejected. Give it a good three to six months or more (depending on where you live) of actively making strong offers, and you will get one accepted.

DON’T neglect inspections.

The escrow period (typically 30 days) begins once your offer gets accepted by the seller. This is the time when your lender works on getting your loan funded, and you get to do your home inspections. These inspections require your time, so it might be tempting to skip over them, especially if you’re buying a newer home. Don’t.

Your agent will walk you through your time frames and attend these inspections with you. Home inspectors almost never do inspections at night (because of the poor visibility). But even if you work Monday through Friday, you can typically book a home inspection for a Saturday. A good home inspector takes his time — sometimes three hours or more — so if you have kids, arrange for your little ones to stay with a family member or friend during that time.

Once all conditions are met and escrow closes, it’s time to move! As a final tip, I suggest starting early on a Saturday morning so you can be at least somewhat settled and ready to return to work on Monday.

Have you bought a house and moved during a really busy time? How did you manage it?

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About Sarah Davis

Sarah Davis is a real estate broker in San Diego, Calif. She enjoys helping both buyers and sellers and was voted one of the top 10 best real estate agents in San Diego in 2013 by Union Tribune readers. In her spare time she talks about real estate on a local radio show and manages her website RealtorSD.com.

Comments

  1. Great article. Even though we’ve bought our first home, we missed a few of your steps and look forward to being more thorough the next time around. For us, the refinance is more frightening than the original purchase. I guess buying a home is more exciting because it’s new. After we refi, same home, same crap, albeit lower payment. Haha!!

  2. These are great tips. I definitely think that getting a home inspection done (once you’re under contract) is an important step. Many people try to skip the inspection in order to save $300 -$500, but it really is a good use of your money. It can allow you to catch a “hidden” glitch in the house that might otherwise have cost you thousands or tens of thousands. Like the cliche goes, knowledge is power!

  3. Krystle Miller says:

    My lease is up next year in March when should I start my pre approval and things?

  4. I’m currently in this situation. I started looking for a house the last week of February (my lease is up in mid-May). Just as I started, I found out I would be going on a 6 week field rotation at work out to an oil rig out of town, working a 10 days on / 4 days off schedule. At the same time, in the area that I am looking in, house are selling in 2-3 days after going on the market. Needless to say, that makes looking for a house quite difficult. I would find a great looking house while I was out working, only to be told that it sold the next day and had 12 offers.

    The key was to be calm and patient. My broker ended up finding a house that was about to be listed and I was in town that day. I looked at and everything was great. I put in an offer that night and it was accepted before it ever went on the market. Luckily, all of my document can be accessed online, so I was able to submit everything online from the oil rig. Closing is in2 weeks and everything is on track!

    Also, lesson learned: do not move money around after starting the loan process! You will have to then provide a paper trail for all of it. Move all funds to your checking account first and leave it there! That is unless you want even more paperwork headed your way…

  5. Krystle Miller says:

    How much will I need for a down payment? Are there any no down payment programs for first time home buyers?

    • You have to put down 20% to avoid Private Mortgage Insurance (PMI) each month, which is typically 0.1% of the cost of the home ($100 per $100k). You have to pay PMI until your equity reaches 20%. Most lenders require at least 10% down for conventional loans. If you meet the income requirements, you can get an FHA (Federal Housing Administration) loan for as low as 3.5% down. However, a low down payment can also lead to a higher interest rate, so in the long run, it is cheaper and easier to put 20%. Also, being a first time buyer, the requirements are usually more stringent because you don’t have a long credit history showing that you can handle something as big as a mortgage.

      So figure out what it will cost you to buy a house in your area, and multiply by .2 to figure out what you need to save. However, remember that you need more than that, you will have closing costs ($5k-$10k), inspections ($300-$400), moving ($500-$1000), insurance, new appliances, etc. I would say you need at least $10k-$20k above your down payment to cover all those cost and still have some left over for life’s little surprises.

      It’s better to be patient and do it right, than to cripple yourself with a brash decision.