April 24, 2025 • 39 mins
Buying your first home is an exciting time but as with anything you do the first time, it can also be a bit overwhelming. We share the importance working a lender and agent that you trust, identifying your needs versus your wants, why to look past the cosmetic features of a home to those that you can’t change, the importance of an inspection and more.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
You are listening to the Remax real Estate Insights show
where you get real talk by real agents. Walk to
you by Remacs of Southeastern Michigan. Hello everyone, and welcome
to the Remax real Estate Insights Podcast. We're happy you
clicked play and decided to join us today. This is
a show where we break down the world of real
estate and share some helpful tips and trends. I'm your host,
(00:22):
Janete Schneider, and today we're diving into one of my
favorite topics, what every first time home buyer needs to know.
You know, buying your first home, it's exciting, but let's
be real, it can also feel a little overwhelming at times.
You know, it's actually a lot like dating. There can
be some red flags. There's a lot of options online.
You don't know whether to believe the photos you're seeing,
(00:43):
so there's a lot of correlations there. On top of that,
if you've never done this before, you're maybe learning a
little bit of a new language. You know, things that
contain mortgaged terms, inspection terms, offers, and negotiations. It can
feel like you got yourself into something more than you
for But don't worry. We've got your back and in
this episode. We're going to walk you through the key
(01:05):
things every first time buyer should know really before they
start house hunting. So whether you're dreaming about a cozy
condo or a fixer upper with potential, this episode has
some practical tips and red flags to avoid that'll help
you feel confident every step of the way. Joining me
today is Pam Balonte. She is the marketing director with
(01:26):
Remax of Southeastern Michigan. Welcome back, Pam, Yeah, hi there,
thanks for having me. Oh my pleasure. And since you've
been on before, I will not ask you again how
you got into real estate. Yes, that is for an
earlier issue, so we have that. So but well I'll
ask you a different question. As we're talking about first
time home buyers. Do you remember back to when you
were a first time home buyer?
Speaker 2 (01:48):
Yes, actually I do so.
Speaker 3 (01:50):
So we've bought two homes, My husband and I bought
two homes, you know, in our married lifetime. But when
we first got married, we lived in an apartment for
a couple of years because we couldn't afford a home right away,
so you know, we kind of did the you know,
rent have some money, you know, and then when we
were ready we're there about two years, rent for about
two years before we actually bought a home. But so
(02:10):
I loved it, I remember from my memory, you know,
it was really fun. Yeah, but it was also stressful
because it's a big purchase.
Speaker 1 (02:18):
It's a lot of money.
Speaker 2 (02:19):
It's a lot of money. Yeah, it's a lot of money.
Speaker 1 (02:21):
You're selling a lot of documents too.
Speaker 3 (02:23):
Yeah, a lot of documents that maybe you don't even
really know what.
Speaker 1 (02:26):
It's just put them in front of, say, sign here,
this is really saying that.
Speaker 3 (02:30):
Okay, yeah, yeah, exactly, a lot of language and everything
that you don't necessarily understand. But but I do remember
being very you know, you know, very proud to become
a homeowner. And I was twenty four when when when
I became a homeowner.
Speaker 2 (02:45):
So it was a fun experience, it was.
Speaker 1 (02:47):
And you were a little younger than I was, because
with my husband being in the service, we were overseas
the first few years we were married. Okay, And so
came back home and got an apartment and stagging off
first and then moved down to Metro Detroit and similar
to you, lived down here for two years before in
an apartment before we jumped into homeownership.
Speaker 2 (03:04):
Yeah, yeah, yeah, so similar, very yeah, similar.
Speaker 1 (03:07):
And like I said, it is exciting. It's exciting when
you start to really, you know, kind of hone in
on I think we can do this. You know, we've
saved the money, and then you get to, you know,
have the fun of going to start to look a well,
what can my money get? You know what? You know where?
You know, where can I buy a house? You know
what features am I going to have? And that's kind
of the fun.
Speaker 2 (03:22):
Part of it, right right, right, absolutely.
Speaker 1 (03:24):
Well, while many things don't and it's funny that you
mentioned age, because while many things don't change much from
one generation to another, I think everybody gets that kind
of excitement and that pride, there is definitely one thing
that's changed significantly for first time buyers, and that's the
age of buying the first home. You said you were
twenty four. Yeah, it's interesting that you remember that, because
I'm like, going, well, same, let me do the math.
(03:45):
I was twenty one when we got I got I
was you know, probably mid to late twenties. The average
age now of a first time home buyer is thirty eight.
Speaker 2 (03:55):
Yeah. That is shocking.
Speaker 1 (03:56):
That's the highest.
Speaker 2 (03:57):
It's been shocking to me. Yeah, yeah, yeah, exactly.
Speaker 1 (04:00):
And I think, you know, a lot, a lot goes
into that. I mean, I think we have to recognize that,
you know, the ability for folks to save the money. Nowadays,
it maybe takes a little longer their student debt, that
previous generations really didn't have to factor much of that in.
You know, the cost of homes continues to go up.
I mean, there's been inflation more recently. I mean, there's
a lot of things that kind of drive this. But
(04:20):
thirty eight is that is the average age for a
for a first time buyer. That's a significant change.
Speaker 2 (04:26):
Yeah, that's that's significant.
Speaker 3 (04:27):
That's not even like your late twenties or early thirties,
even right thirty eight, you know, yeah, yeah, yeah, I
think that I have a niece, she's twenty seven. She
got married last summer, but her and her fiance boyfriend
would ever had been living together writing and you know,
their first time home, you know, was over three hundred thousand,
(04:51):
I mean, and it's a small home. That's it's a
starter home, you know, so it's always you know a
lot of people like wow, you know, how can they
afford that?
Speaker 2 (04:57):
And stuff?
Speaker 3 (04:58):
But I think that younger people maybe just accept the
fact that their house payment is going to be.
Speaker 1 (05:05):
It's going to eat up more of their it's going.
Speaker 3 (05:06):
To eat more, you know, whereas there's no way you know,
back when I was buying our you know, when we
bought our first home, you know, I think our mortgage
payment was like eight hundred a month.
Speaker 1 (05:15):
Or it was cheaper. It was cheap, I mean cheaper
than rent, I mean because that was like the hurdles.
Like us, I'm actually paying more to rent than if
I can just save the money for the down payment
and the closing costs and get myself into the house. Yeah,
my monthly not actually goes down right, right exactly.
Speaker 3 (05:29):
So I think it's like almost like a new world
where younger people maybe are just accepting that, like you said,
they're what what they're putting, you know, towards their monthly payment,
you know, kind of just eats into their overall.
Speaker 1 (05:41):
A little bit more more than what previous generations. Yeah,
now you have three, three kids, do you see any
of them buying a house in the near in the
near future. Do you think they're going to be thirty
eight before they get their chance?
Speaker 2 (05:52):
Yeah, well, you know, if they are hopefully they're not.
Speaker 3 (05:57):
Exactly but no, I mean, I hopefully not thirty eight,
you know, but I don't see definitely not twenty four,
you know what I mean. And you know, I think,
you know, one is kind of early into his career,
time to build up his career. One is in college,
about halfway through college, and one's still in high school.
But but I don't see them like in the near
(06:17):
future being able to afford a home.
Speaker 2 (06:20):
And you know, and it is kind of a double
ed sword too, because you.
Speaker 3 (06:23):
Know, I think, you know, especially you know moms, you know,
they old, you know, they don't want their babies to leave.
Speaker 2 (06:27):
But you know, reality is you kind of know that
they need to leaven. You kind of really avention that's
what you want them to.
Speaker 3 (06:34):
But you know, there's also that argument where you know,
like if they went to go rent somewhere, like rent
is really expensive to fifteen hundred, two thousand a month,
well it's almost like we'll stay at home, right and
if you can actually afford that two thousand months, just
put it into us nice little sayings, and now you're
saving for a nice down payment on a home.
Speaker 2 (06:55):
You know.
Speaker 3 (06:56):
So maybe and maybe that's what people are finding you know,
to stay with parents a little bit longer so you
can save that money.
Speaker 1 (07:01):
And I see, I see that. I see that with
some of my friends. I see that with my nephew.
Now he's a little bit younger, he's twenty, but you know,
just got a job in you know, skilled trades, and
you know, it's kind of working his way through that
right now and living at home. And I think, you know,
my sister's been perfectly happy, you know, to say, hey,
look if this allows you to, like you said, save
up some money. I mean, he definitely wants to buy
(07:23):
a house. I mean that is totally on his horizon
and his thinking. But right now, it's okay, getting kind
of settled in the job, saving the money to do it.
And I think you're right, that is going to be
the path for a lot of folks, you know, right now.
Speaker 2 (07:32):
Yeah. Yeah.
Speaker 3 (07:33):
And also what I think is interesting is the one
that's in college and even the one in high school
have shared with me on a couple of occasions that
they actually feel anxiety about being able to be out
on their own, like it, you know, it's a reality
in there. Now.
Speaker 1 (07:50):
That's interesting because I mean you'll you'll read articles or
hear things about that, and it's interesting to know that
that it's for real, you know that that there really
is anxiousness around this, and I feel bad that that's
something that they have to deal.
Speaker 3 (08:01):
With me too, Me too, because I'm like, I never
felt that way. It was just like, Nope, this is
how life goes.
Speaker 1 (08:06):
You do this, you save the money.
Speaker 3 (08:07):
Yeah, yeah, yeah, And it was like there was no
I don't ever remember feeling I mean, certainly during the
home buying process, well some things, yeah, but never.
Speaker 1 (08:13):
Like like I'm not I'm not sure I'm ever going
to be able to do this.
Speaker 2 (08:16):
Was not the.
Speaker 1 (08:17):
Anxiety, right, yeah, right, absolutely. It was the amount of
paperwork I'm signing and yeah, I'm signing something to to
pay for thirty years. I mean those types of things normal.
Speaker 3 (08:25):
Yeah, that's normal, you know, but kind of like that
early and again the one.
Speaker 2 (08:29):
Is still in high school.
Speaker 1 (08:30):
That's really interesting.
Speaker 2 (08:32):
Yeah. So it's I think it's you know, it definitely
is a real thing. You know.
Speaker 1 (08:35):
Well, we can't solve all of those problems today, but
what we hopefully can do is we want to dig
into some things that some first time buyers really need
to know. And the first really does deal with their budget.
We've been talking a little bit about the ability to
afford this, you know, and and the financial side of it,
and the down payment really gets all the attention, right,
I mean, that's that's what everybody talks about. You know,
how much money are you putting down? Have you saved
(08:56):
money for the down payment? And clearly that is important, Yeah,
but there is more to it than.
Speaker 3 (09:00):
That, Yeah, there is really, you know, definitely there is more.
So the earlier you can start saving for the house,
the better because you're going to need more money than
just a down payment. You need to consider things like
closing costs, inspection and appraisal fees, moving fees, and even
homeowners insurance. So these are all above and beyond that
(09:22):
down payment. There might also be fees like a paying
a paying a probation fee for a homeowners association, you know,
if that's applicable you know where you're buying, and maybe
you're going to be choosing to purchase a home warranty,
a home warranty policy. You know, that's additional costs there,
so you know, and I do think first time home
buyders they're not even thinking about these things.
Speaker 1 (09:43):
Now because this is an everyday conversation, right, I mean,
if you've been living at home with mom and dad,
you might hear about the mortgage payment. You may hear
you know, oh, the insurance you know bill came in
the mail of you know, prices went up again. I mean,
there's a few things that might be on the radar,
but unless you've been starting to do some you know,
due diligence and some research on it, there are some
other things that closing costs. What are those things?
Speaker 2 (10:01):
You know?
Speaker 1 (10:01):
I mean, and it could just be slipping past if
it's not something you're doing some research on right right
exactly and having moved recently. Some other things to you
know include you know, like right at the closing, if
you're getting keys at closing, is you know we had
the locks change that day, you know, we had we
had somebody out there that afternoon changing the locks on
the house. Not that I thought that people before it
were bad, but I don't know who they've all given
(10:22):
a key to. And you know, it doesn't cost much,
but again it's another outlay of money at the time
that you're doing all of this. A good rule of
thumb is to have a plan to for you know,
for at least maybe two to six percent of the
cost of your home set aside for other related you know,
house purchasing, you know, in related cost. If you can
kind of plan for that, that's probably a good thing
(10:44):
to do, right.
Speaker 3 (10:45):
I think having that additional saving is going to help
you with any of those unexpected repairs that you know
may come up quickly. And I truly think that. I
mean from the two home purchases that we did, there
were things like almost immediately.
Speaker 1 (11:00):
Yeah, it's like the appliances all put on a good
show while you're looking at the house. Everything works just fine,
and then you move in there like, oh now our
true colors can come. Now we're going to show what's
what's going on out there. Yeah, And I mean hopefully
it doesn't happen to you, but if it does, I mean,
you want to have a little something because you just
never know, right right, So all right, excuse me. Once
(11:20):
you've saved up money and you're ready to start the process,
you really want to meet with the lender. I'm personally
a big fan of meeting in person with the local lender,
so they get to know you, they get to ask questions,
you know, you get to feel comfortable with them, you
can share your situation so that they can come back
with you for the best options that fit your specific situation.
(11:42):
Because maybe you know, maybe there's something you know, maybe
you're maybe you served in the military. A v l
V A loan may be an option to consider. Now,
ultimately that may not be what you choose to use,
but it's an option that can get thrown on the
table that have you know, pros and cons that would
come with it. But doing just the online callulator or
something quick and easy, it's great to put you in
(12:02):
a ballpark of what something's going to cost. But I'm
a big, big, big believer in going and talking to
to a local lender, you know, live and in person.
And you know, if you have a lot of money
at a specific banker or credit union and they offer loans,
maybe you get a better rate because you've already you
already are a client of theirs and that there are
if you already have money with them, you may get
(12:22):
a better rate. Then you're going to get off the
streets someplace else. So I always think it's good to
do that at times, pre qualification and pre approval often
kind of get interchange your reference as if they're the
same thing, and they're not, So can you share a
little bit about what's the difference and you know, maybe
why one's better than the other.
Speaker 2 (12:42):
Yeah, yeah, definitely.
Speaker 3 (12:43):
So a pre pre qualification gives you a very general
idea of what a lender is going to approve you for.
But but with this lender is only going to use
limited information that you provide them. They're not pulling a
credit report, they're not verifying your income, you're jobs, any
debt you may have. You know, these are these are
actually what's done in the pre approval process. So you know,
(13:07):
during that pre approval process there's gonna be a hard
credit check either, going to contact your employers, all kinds
of things to really understand what your financial situation is.
Speaker 2 (13:16):
So that makes you pre approved.
Speaker 3 (13:20):
And I would like to say it can be very
helpful to get pre approved for a mortgage ahead of time,
ahead of shopping for those homes. You know, again, during
this process, they're really gonna, you know, look at your
credit you know, look at your job situation and your
income to really decide how much you can afford, which
is great to know. You want to you really want
to know, like what could I really afford it.
Speaker 1 (13:41):
Before I fall in love with something. I'm out here
looking at this price point. There's not a prayer in
the world. Any letter's gonna suit me for that.
Speaker 3 (13:47):
Yeah, you know, don't even think about you know that,
you know, and you will get approved pre approval letter
and that's usually valid for about sixty to ninety days,
and that does outline how much you are eligible to borrow.
And what I like about this it shows the home
sellers that you are a serious buyer, okay. And then
in a competitive market, you know, where there may be
(14:07):
multiple offers at a home, this is going to give
you kind of that competitive edge, right because you already
are preapproved, you know, you know, the sellers know how
much you.
Speaker 1 (14:14):
Know, yeah, I mean, and a good agent is gonna
be able to say, hey, basically, the only thing missing
is the address of your house in here. They've already
been approved by the lender. The letter is telling them
they will give them a loan for X. They just
needed to pug in the address of the home they're
they're choosing to buy. And that does matter in competitive situation,
which our market seems to be that way. It still
is that way in a lot of ways. Now, something
(14:35):
to point out here is that it's not uncommon for
a buyer to be approved for more than they thought
was possible. And I know this was certainly true for us. Yeah,
you know, I think every time we've bought a house,
and we've bought four, every time we've bought a house,
I always chuckle at what they approved me for. I'm like,
do you not want me to have a life outside
of owning a house? Because it seems like you're approving
(14:55):
me for something that like most of my money would
be going just for the house payment. Me crazy. I
like to do things besides that. So it's not uncommon,
and especially for your first time buyer. I want people
to be aware. You aware of that lenders are using math.
What your income is, what your debt have, what your
credit scores are, you know, all of that. So they're
just using kind of math to figure this out. Just
(15:18):
because you're approved to a certain price point doesn't mean
that that's the right amount for you to feel comfortable spending.
You want to factor in your lifestyle. Do you want
to be able to travel? Do you enjoy maybe entertainment
or eating out from time to time? Are you also
I'm hoping try to save for retirement, you know, putting
some general savings away. You want to decide what you're
comfortable spending and factor that into the equation as well,
(15:43):
and doing some you know, kind of prep for this.
I mean one of the things I had read was
think of it like going to a buffet. You know,
most of us don't go to a buffet and fill
their plate till it's overflowing, right, I mean, you kind
of take what works for you, kind of the same
with this. Take what they're saying and say, you can
be proud if they approved you for something more than
you want to buy, but you want to be realistic
about what you are ultimately comfortable, right, Comfortable.
Speaker 2 (16:04):
Yeah, I think that's good advice for sure.
Speaker 1 (16:06):
Yeah. I remember my sister went through the same thing.
She was buying a house on her own as a
single female years ago, and she called me up after
the she was they approved me for this, and that
just doesn't seem right. I said, well, let's talk. Let's
talk about it. And I think if you haven't been
through this before, you don't know.
Speaker 3 (16:21):
Right, Yes, I agree, I agree, and you get so excited.
I remember that you know you feel so excited. Well,
look what I could afford, you know, but you're not thinking, oh,
I really still need to eat pugasma car and you know,
and maybe do a little travel or whatever whatever else.
Speaker 1 (16:35):
You know, you know, whatever else you've got going on.
You if you want some other discretionary income to be
able to do other things besides literally just live in
your yeah.
Speaker 2 (16:43):
In your house that you overspent or something.
Speaker 1 (16:46):
Once you've spoken to a lender and you have an
idea what your budget is, you also want to be
finding a trusted real estate agent. I mean, and in
in theory, you can get the agent first, and the
agent can certainly give you recommendations to lenders you know
that they know have a good reputation. You know, if
you don't have somebody in mind, you know, on yourself,
you can kind of interchange these first two. But you
definitely want to have you know, a lunder and get
that pre approval and have a trusted agent that you're
(17:09):
working with. And of course, you know, having a trusted
agent is a little something. You know, those of us
that work at Remax are you know, are passionate about.
Speaker 2 (17:16):
We're passionate about I guess we could put our shameless
plug in here. Yep. That we've been voted the number one.
Speaker 3 (17:21):
Most trusted agents in the US multiple times. Actually, yeah,
in different studies. So yes, we do know about the
trusted agent.
Speaker 1 (17:28):
Absolutely, mm hmm.
Speaker 3 (17:30):
So some things you should be looking for when interviewing
your agents is how much experience they have, and they do.
They have experience working in the areas that you are
looking to purchase. They should know the local market inside
and out. And you want someone who's going to educate
you but not overwhelm you. They should have the patience
and ability to explain the process and answer your questions
(17:51):
because it is overwhelming and there are a lot of
questions and.
Speaker 1 (17:54):
You might ask the same question three different times, you know,
because you heard you know, they told it to you
at the front of the process, but it wasn't relevant
at that point in time, right, and then you know,
now you're four steps in, it's like, well, now this
is pertinent. What did you say about What did you
say about that?
Speaker 3 (18:07):
Yeah, yeah, yeah, yeah, definitely. And also look for an
agent that has like a great team behind them, and
that's a team that maybe includes like vendors that you
know that you know vendors for you know, inspection moving companies,
you know that type of thing. You know, they should
have that all in their backpacket that they can recommend
to you.
Speaker 1 (18:27):
That's a I mean, that's a tremendous amount of value
that I think great agent spring and especially agents that
have been doing this a while. The longer they've done this,
the more likely that they've got a really wide, you know,
depth of contractors and vendors that they can refer you to.
Speaker 3 (18:41):
Yeah, yeah, absolutely, And that saves you from doing that, right,
doing all that research on your own.
Speaker 2 (18:46):
So that's value.
Speaker 1 (18:47):
And not just the research, which is in and of
itself something. But I'm just going to go to the
roof situation that that we've had recently at our house
where we had a leak and we needed to find
a roofer, and I contacted our agent and then I
put something out on Facebook cause I knew Darnell I'd
have a lot of agents responding to it. And but
I mean the reality of is contractors and vendors get
(19:07):
repeat business from real estate agents. They tend to jump
when an agent calls. They tend to come out and
get you know, and come out and give the bid
because they get repeat business from vendors if it was
just me reaching out to these people, not that they wouldn't,
but I'm a one and done client, right, I'm getting
one roof in this house. That's it, period the end.
But an agent referring me to me. I've certainly witnessed
(19:28):
this first hand with multiple people over the last year.
Is when my agent recommends somebody, they come out within
a day or two because they want to keep the
agent happy, so she keeps referring business.
Speaker 3 (19:39):
Yes, absolutely, that too, Yeah, yeah, I do love that
for sure. You know, and overall, you want to get
a good feel from talking to your agent because because
ultimately the agent is going to be negotiating on your behalf, right,
so you want to you want to feel that confidence
they're going to be able to negotiate on price, maybe
negotiate after inspection and pairs need to be done, that
(20:01):
type of thing. So you want to make sure that
they have your best interests in mind.
Speaker 1 (20:06):
Yeah, you really do. And I think it's important. You know,
you're kind of laying out what to look for. You
know that they've got this you know, team of professionals.
You know that around them that they have the patience
to answer your questions. If you're a first time buyer potentially,
and we recommend you know, unless you've worked maybe somebody
in the family's worked with somebody who's just the given
person you're going to work with because you know them
and trust them and like them already, that you interview
a couple of agents. You know, find an agent that
(20:28):
is the bet fit, best fit for you, somebody that
you feel there's that this chemistry, a rapport and that
you that you trust them, and you know as you're
talking to agents, if you are going through the interviewing process,
there's some red flags that you can look out for.
If they're encouraging you to look outside of your budget,
that to me would be a red flag. If you
if you're firm, you've got to pre approval and you've
(20:49):
you know, you're taking that into account along with you know,
what you feel comfortable spending, and you've got somebody that's
consistently pushing you far outsid I mean i'd say far
outside that, but I mean just in general, pushing you
outside that. I think that's something to you know, take
a look at are the again, is your best interest
really at heart there? And are they pushing you to
view homes that aren't the right fit. Now, for a
(21:11):
first time buyer, this can I think you're threading a
needle here right, Yeah, because you've never bought a house before,
and it's somebody going to say, well, what do you
need versus what do you want? You know? I mean,
and that can be the answer. I mean obvious things
are how many bedrooms and stuff like that? Do you
need a fence yard? Do you not? Is that important?
As an attached garage important? Is a one or two
guard garage important? I mean there's all these kind of
(21:33):
decisions and it's the first time buyer. You may not
have the clarity that you have buying a second and
third house. Because now that you've been through it, I
think you get a little better at knowing what you're Yeah,
you're once versus me, you're once versus these but as
if you have you know, put out here, this is
what I'm looking for. I need this baby on the way.
We need at least three bedrooms. And they keep showing
you something that's too well, you can maybe you know,
(21:53):
work this other little side room into something. No an
agent should be looking you know, again, red flag if
they're pushing you into something that isn't right. And to
your point, you said, they should be able to answer
your questions. If they're not doing that, or their answers
leave you confused, or you're made to feel that your
questions are a bother, you know, or cumbersome, it's probably
not the right agent. Because you want somebody that is
(22:15):
willing to hold your hand, you know, so to speak,
you know, willing to be patient to answer your questions
the first time, the second time, the fourth time, you know.
I mean, that's what they're that's what they're there for.
They should be making your life easier and smoother. And
if you just feel that every time you talk, you know,
even in the interviewing process, if this is not happening,
it's probably not going to get better, right.
Speaker 3 (22:36):
Right, Yeah, Yeah, I think you'll know. I think you'll
know in that interview process right then and there. And
I yeah, I think it has to be a comfortable fit.
I think everyone kind of knows. It's almost like trust
your gut type of thing.
Speaker 1 (22:46):
Yeah, you know, so you you'll know, you'll know, I mean,
any of those things when you're going through there, if
you're just getting some red flags and something in your
stomach isn't feeling right, Trust the gut, interview someone else
because there is a good agent out there for you.
Speaker 3 (22:57):
Yeah, yeah, right, and there's there. You know, there's no
limit to how many agents you can interview.
Speaker 1 (23:02):
Exactly, you know what I mean. So so take that time,
take the time you're you know, you're going to be
sharing personal financial information with them, Like you said, they're
going to be negotiating on your behalf. You want to
have that level, you know, level of trust. And I
guarantee the right agents out there. And in case we
didn't mention it before, Remax agents we named the number
one of us trusted. That's all I'll say it. So
(23:23):
you have your lender, you have your agent, you know,
kind of on what we're going to call your real
estate team now, right, I mean, because you're building your team.
Your lender is a big part of it. Your agent's
a big part of it. Now you want to start
looking for homes. Now, this to Pam's point earlier, this
tends to be the fun part of the process, but
it can be overwhelming if you don't take steps to
be prepared. So you know, this is a good time
to share some house hunting tips The first tip is
(23:45):
to identify. We just I just mentioned this briefly before,
your needs versus your wants, So how do they do
that exactly?
Speaker 3 (23:52):
So so you kind of think about it as your
must haves.
Speaker 2 (23:56):
Right, your must haves are your deal breakers.
Speaker 3 (23:58):
So when you're thinking of your must haves, you need
to be thinking about, you know, how many bedrooms must
you have?
Speaker 2 (24:05):
You know how many people in your family? How many
bedrooms do you need?
Speaker 3 (24:07):
You know the location of the home, you know, what
type of parking do.
Speaker 2 (24:12):
You do you want? Driveway garage?
Speaker 3 (24:14):
You know that type of thing, the school district, you know,
do you want a ranch?
Speaker 2 (24:18):
Do you want? You know, a colonial? You know? Think
you know these and these are the things that.
Speaker 3 (24:23):
Are must have, So you must have these versus nice
to haves, which things are like they'd be great, but
they're not required. So you know, you think of things
like maybe a finished basement or a fireplace, maybe a
walking closet.
Speaker 2 (24:37):
You can live without them.
Speaker 3 (24:39):
They'd be nice to have, right, but they're they're not
going to They don't they're not required for for what
you need. So being clear on what you need versus
what you want is going to help your agents show
you the homes that meet your needs, so then you
don't spend a lot of time looking at a bunch
of homes that ultimately is not going to do it
for you.
Speaker 1 (24:59):
No, it's not the right fit. Or you fall in
love with something that you're ultimately not going to buy
because you know, I think everybody's done that when you
when you're not as clear and you're seeing kind of
everything that's out there, and usually we fall in love
in the cosmetics. You know, you fall in love with
the way something looked, and now you're not seeing that
in the homes that I actually have the features that
you want. You have to almost like kind of you know,
(25:19):
like divorce and separate yourself from the house that you
fell in love with. But that isn't right for you, you know.
Speaker 3 (25:23):
Yeah, yeah, maybe it's in the wrong school district, the
wrong location whenever. It has all the beautiful things, but yeah,
you know, but it.
Speaker 1 (25:29):
Doesn't check other boxes that you said were you know, important.
And to be honest, for first time buyers, it's okay
if this kind of changes, because when you first sit
down and do it, when you've never done this before.
There are some things that I think are easier than
other bedrooms, I think is a little easier. Typically, you
know what you need is as you're starting out, there's
some other things that you know, you may not really
(25:50):
crystallize on until you've seen a few houses, and then
all of a sudden, it's like it's like, you know,
something kind of flips and you're like, Okay, now that
I've been out there and I've seen some stuff, I
want this. I've decided I do need this. I didn't
articulate this, but now that I've seen a house without it,
I'm realizing I really do need this.
Speaker 2 (26:05):
That's a good point.
Speaker 3 (26:05):
Yeah, it might take a couple couple of viewings to
actually nail nail down you know, some of those.
Speaker 1 (26:11):
Because most first time buyers have either lived at moms
and dad's house, yes you know, or maybe an apartment
you know, or you know, if they went off to college,
you know, a dorm or something like that, and you've
not put a lot of thought into You've just lived
what's been provided or what was available to you, and
you had to take it for what it was right,
like it or not, like it meet your needs or not.
It was where you were living. And now, for the
first time, you kind of have like, oh I get
(26:33):
some sand, Yeah.
Speaker 3 (26:33):
I get some sand it yeah. And you know, unfortunately,
I think the truth is when you know it's it's
neither good or bad. But I think you almost have
to the batter scenarios when you're buying, like your second home,
because once you've actually had that kind of that independence
of being a homeowner and experiencing it, then you realize, oh,
I really do I really do? You know, I really
(26:54):
need that bigger kitchen. Like you you almost get to
narrow you.
Speaker 1 (26:58):
Know, you do it because now you've done it, you've
lived with Because it's so funny you mentioned storage because
when we were looking for our first house, we were
and we were early on just you know, starting to
go out on Sundays, you know, going through open houses
and stuff like that, and we went through this house
and you know, it was kind of the area we
were looking. The price point was right, you know, and
I can remember going through the house and I kept saying,
(27:19):
something's off about this house. There's just something on and
I couldn't put my finger on it. And it wasn't
till we went to the next one was I remember
turning oud look at my husband going there were no closets,
That's what it was. And I was like, it didn't
hit me when we were going through it. But storage,
I mean, and you don't realize until you own a
house how important closets the storage. Yes, yeah, yeah, exactly.
Speaker 3 (27:37):
I think that's probably like a number one thing you
realize after you live in your first.
Speaker 1 (27:41):
First time buyers and that wasn't on your list, pay
attention when you're going through homes. Do they have closet space?
Is there some storage space? I mean even in the
more smaller footprint homes, because our first home was under
a thousand square feet, Yeah, you know, but if you
have an extra bedroom and that has the closet way, hey,
bingo storage.
Speaker 2 (27:58):
Yeah yeah, yeah, yeah, yeah for sure.
Speaker 1 (28:00):
So what are some other things that first time buyers
should keep in mind when looking at homes?
Speaker 3 (28:05):
Yeah, so, you know, if possible, drive the neighborhoods, you know,
in the area that you're interested, you know, and do
that at different times of the day and at different
days of the week. This is way you can pay
attention to kind of traffic flow, noise, you can pay
attention to, you know, the different you know, adjacent homes
and yards. Just kind of get a feel for what's
happening on the outside of the neighborhood, if you will.
(28:27):
And then when you're actually going inside homes that are
for sale, you know, don't get distracted by the sellers
decor or the stuff that they have laying around, or
maybe the way the house is staged. Focus on what matters,
you know, again, some of the stuff that the needs, right,
you know, lay out natural light, you know, and for
sure the condition of the house, you know, the major
(28:48):
you know, pieces of the house, components of the house
and everything, you know, structure and that type of thing.
Speaker 1 (28:51):
Yeah, because I mean, like I said before, I think
it's the cosmetic stuff that often captures our attention. Most
of us are emotional people, right, I mean, so we
we you know, things are ted by color and smell
and you know, different things like that, and we fix
you know, we kind of get fixated on oh I
really like the light fixtures, or I really liked the
color of the kitchen. But the reality of it is is,
(29:12):
you know, whether you like it or not, that can
get changed. What can't get changed is the natural daylight
that it gets, you know, or the location of the
house in the subdivision, or do you like a north
facing house versus a south facing house. Things like that
you cannot change so that you really do want to pay,
you know, pay attention to. So many buyers are looking
for something that is move in ready, in other words,
(29:33):
it doesn't require a whole heck of a lot of work.
But sometimes a fixer upper it can be a good option,
especially for a first time buyer. So what would what
were some things to consider there?
Speaker 3 (29:44):
Yeah, so a fixed opper can be a good option.
A fixed opper is technically a home that needs some updating.
And this could be you know, something simple like, you know,
fresh coat of pain on all the walls, you know,
fresh carpeting or hardred floors, you know that type of thing.
But a fixed opper could also mean maybe more of
a significant overhaul, right.
Speaker 1 (30:03):
Yeah, that would be the phrase handyman special.
Speaker 2 (30:05):
Yeah, yeah, special exactly.
Speaker 3 (30:09):
But the reason why it's a good option is that,
you know, purchasing a fixer upper will likely come at
a lower price point, and it also gives you the
opportunity to customize the house the way that you want it.
So it's almost like, you know, get you get to
put your own footprint in you know right away. But
on the flip side, you do have to consider the
time and the money and the cost right that it's
(30:32):
going to take you to do you know, those repairs
and those updates.
Speaker 2 (30:36):
So it's a you know, you have.
Speaker 1 (30:37):
There's a trade off.
Speaker 2 (30:38):
There's a trade off.
Speaker 1 (30:38):
There's a trade off, I mean there is. And if
you opt for a fixer upper, you really want to
pay attention to the home inspection because again, paint, that's easy,
that's a that's a cosmetic choice. You want to take
a look at the home inspection, really understand the full
scope of repairs needed. And to your point, how does
that match with your budget? You know, we've talked about
you your approof for this, but what we're comfortable spending. Okay, well,
(31:01):
you've got your mortgage payment. Now, if you're going to
do a fixed rupper, there's going to be ongoing costs
until you make some of these repairs that you're talking about.
You know, can you get the home for you know,
a low enough price point that it you know, adjusts
your monthly mortgage, so you've not got the flexibility to
you run into you know a lowser a home depot
you know, every week to buy what you need to
buy to, you know, do what you need to do.
(31:23):
But while it can present challenges, it can also be
incredibly rewarding. You're going to feel like this house is
yours when you get it to the point, you know,
of making the changes that you want to do. So
you know, this will be for some people, it won't
be for everybody, but it is an option.
Speaker 2 (31:36):
It is an option.
Speaker 1 (31:37):
Yep, yep. Speaking of inspections, that is an incredibly important
part of the home buying process. What do folks need
to know about that?
Speaker 3 (31:45):
Yeah, so a home inspection identifies issues that may not
be readily apparent, such as structural problems or faulty systems.
Speaker 2 (31:53):
You know.
Speaker 3 (31:53):
But items found during an inspection can be used to
negotiate a better purchase price, or you can request to
have the repairs.
Speaker 2 (31:59):
Done before closing.
Speaker 3 (32:02):
What I like about the inspection It does ultimately provide
a roadmap about maybe some future repairs that you would
have in the house, and they kind of plan accordingly
that way, you know. And it is important to remember
that that it's not uncommon for an inspection to find
some things. Absolutely, I don't think any house is going
to be inspected and it's going to get.
Speaker 1 (32:24):
There's absolutely nothing that needs to be done.
Speaker 3 (32:26):
Right right, So I think first time home buyers need
to really be aware or not get freaked out by
their inspection report, you know, you know, and some of
the items are relatively easy to dress, like again, calking,
you know, walking around windows, you know that type of.
Speaker 2 (32:40):
Things, easy, easy to fix and stuff like that.
Speaker 3 (32:43):
But even if more significant things are found, it doesn't
mean you need to walk away from the deal, you know.
And I think because you do have that opportunity to
have them fixed before you closed or asked for those
concessions you know, in the purchase price.
Speaker 1 (32:57):
So no, and I think you're absolutely right, and that's
something to keep in mind as a buyer. I mean
you're thinking, Bye, I'm spending all this money and now
they just gave me this fifty page report. Yeah, that
list you know, stuff that's wrong with the house quote
unquote wrong you know with the stuff or the house,
and you know all these things I should be doing well.
And a good agent will help explain this. They'll kind
of come up, you know, and they will help kind
of guide you through all of this. Part of the
(33:18):
inspector report is going to be truly things that the
inspector found. They can be minor little things to something
that is a little bit more significant that may need
to be addressed in the short term. There is another
section typically of most home inspector reports that is future maintenance.
You know, we're just pointing this out. You're fine now,
but you might want to consider in the next year,
or in the next couple of years, or your roof's
(33:39):
got you know, a lifespan of five years left on
it from what I'm seeing right now, So some of
it is the here and now, and some of it is,
like you said, it's almost like a roadmap or future
guide as so well, if every year I take this
out and kind of look at it during maybe my
spring and my fall maintenance, you know what else can
I take off of this list that they're suggesting I do.
It can kind of help you be a roadmap. But
(34:00):
if you've never been through it before, and you've paid
a few hundred dollars to have an inspection done or
more depending on you know, the size of the house
and what you're all having done, is you get this big.
You know, they don't get buyers anymore. It's all digital.
But I mean, you know, you got this big report back.
You're like, oh my goodness, all I see is issues.
Yeah yeah, take a breath, take it, take a breath.
Speaker 2 (34:20):
Yeah yeah.
Speaker 3 (34:20):
And again I think, I you know, I guess, and
I'm probably basing it on my memory, but like as
a first time home buyer and you see that and
it's just like, oh my god, you know this house
that's got so many issues, but it's not really like.
Speaker 1 (34:32):
It's typically not. I mean, and if it is something
that is a big deal, your agent's going to know,
and like you said, now we go into negotiation mode.
If it's a big enough issue, a costly enough issue
that this is why the inspection's there is it does
give you the ability to say, hey, this is big
enough that either it gets fixed before we close, or
I get some money back and I'll fix it myself.
Because that's that's part of it too. You know, how
much do you trust the sellers? You know you're getting
(34:53):
a good vibe from them that they're going to fix
it and fix it to your satisfaction. Are you better
off negotiating a price down and saying you're going to
fix it, and you pick who comes in there and
does it pulling off of my recent home purchase a
year ago. We wanted to do the stuff ourselves. The
house was owned by investors, doesn't mean that they're bad.
They didn't live there, right, and you know, they just
wanted to get rid. It was clear they wanted to
(35:14):
sell this and move on, which is fine. I didn't
trust that they cared as much about who was going
to fix this and how as I was going to care,
you know, being the one living in there. So we're like, no,
we would rather bring that price down. We'll find our
own people to come in. But you know, every situation
is every situation is different, absolutely, So again you're going
to re review all this with your agent, let them
(35:35):
talk to you about what's kind of normal in the area,
you know, and then but then again you can use
this as a negotiation, you know, not a not a
jumping off point typically any parting advice that you have.
I mean, there's a lot more, honestly, that we could cover.
I mean we're kind of trying to keep the shortened
to the point. Get a lender, get pre approved, get
your agent wants and needs, have the inspection done, you know,
(35:55):
I mean there's a lot you know, deeper. We could
go on this, but we're kind of keeping a high
level today for this conversation. But is there anything else
the first time buyer like any parting things that they
wouldn't think.
Speaker 2 (36:04):
That they wouldn't think of. I think this is a
good one.
Speaker 3 (36:07):
Save the package of documents that you get at closing
because you will need them for taxes.
Speaker 1 (36:14):
Yeah, for first time buyer, this may be a different
concept for you as well, because you're just used to
taxes coming out of maybe payroll or if you're an
independent contractor, you know, your estimated quarterly payments, that's your
version of taxes all. But when you own a home,
you know, it kind of opens up a whole new
potential door or opportunity, depending on how you look at it.
You own a home, you know, typically there are things
that can now be deducted off of your taxes. The
(36:37):
interest that you pay your mortgage is one of them.
That is a often huge benefit for people. But the
year that you buy and sell a home, there can
be tax ramifications. And it's easy to say, boy, this
is kind of old fashioned. They gave me this, you know,
folder full of a bunch of stuff I signed at
the closing table. What am I supposed to do with this?
It doesn't fit anywhere, But you do want to save
it because there is information in there that you may
(36:58):
need for your taxes the funding year.
Speaker 2 (37:00):
Yeah, I think that's a great point.
Speaker 1 (37:02):
Yeah, And just gonna say I I had to dig
out both packets recently doing our taxes because in our case,
you know, it wasn't a first time buyer, it was
it was you know, a subsequent move, and it was
now like, well, now we've made money on the house
we sold, but I was proving that we didn't make
so much as to have to pay attack capital gains.
Speaker 2 (37:19):
Tax on that. So there you go.
Speaker 3 (37:21):
See, right, all kinds of nuances no matter we are
in the in the cycle, in the process process.
Speaker 1 (37:26):
But yeah, its first time buyers. They're giving that that
for a reason. You absolutely want to keep that information
now and in the future. That was going to be
helpful to you, So don't don't.
Speaker 3 (37:35):
Just Yeah, and they are large, they're kind of odd shape,
I agree, But find a place, find a place find ale.
Speaker 1 (37:41):
Yeah, exactly, find some place to stash it, because you're
gonna you're gonna thank us for this about a year
from now.
Speaker 2 (37:47):
Exactly so.
Speaker 1 (37:48):
Purchasing a home. It's an incredible achievement that comes with
many benefits, and it comes with a learning curve, no
doubt about it. Doing anything big in life the first
time you know you're going to learn a few things
along the way, give yourself some grace, Recognize you aren't
expected to know everything right away. You're taking a big step,
and celebrate the wins along the way. Saving the money
to buy the house, that's a win. Take that as
(38:10):
a wine. Pass yourself on the back. Getting pre approved
a win, you know, pat yourself on the back for that.
Finding the right agent, searching for the home, all of
those are steps in the process that it's okay for
you to have the little Bouhu dance and be proud
of yourself. They're all important steps. Enjoy as you go
through it, and then as you find the home and
close on the home and move in, we certainly wish
(38:32):
you all the best, you know, as you start that
chapter of your life. Yeah. Well, thanks to Pam Belonte
for being my guest today and is always a big
thanks to all of you that are listening. Please feel
free to share this podcast with any potential first time buyer,
you may know, you know. If you're a parent, a grandparent,
a loving aunt or uncle that may be listening to this,
(38:54):
and you've got somebody kind of coming up and thinking
about buying a home, please do share this with them.
We're happy to pass the information on to as many
ears as we can get it too, and we look
forward to chatting with you again soon. We hope you
enjoy today's episode. Don't forget to subscribe, write a review,
or rate the show, as it helps us reach more people.
You can also follow us on Facebook and Instagram.
You are listening to the Remax real Estate Insights show
where you get real talk by real agents. Walk to
you by Remacs of Southeastern Michigan. Hello everyone, and welcome
to the Remax real Estate Insights Podcast. We're happy you
clicked play and decided to join us today. This is
a show where we break down the world of real
estate and share some helpful tips and trends. I'm your host,
(00:22):
Janete Schneider, and today we're diving into one of my
favorite topics, what every first time home buyer needs to know.
You know, buying your first home, it's exciting, but let's
be real, it can also feel a little overwhelming at times.
You know, it's actually a lot like dating. There can
be some red flags. There's a lot of options online.
You don't know whether to believe the photos you're seeing,
(00:43):
so there's a lot of correlations there. On top of that,
if you've never done this before, you're maybe learning a
little bit of a new language. You know, things that
contain mortgaged terms, inspection terms, offers, and negotiations. It can
feel like you got yourself into something more than you
for But don't worry. We've got your back and in
this episode. We're going to walk you through the key
(01:05):
things every first time buyer should know really before they
start house hunting. So whether you're dreaming about a cozy
condo or a fixer upper with potential, this episode has
some practical tips and red flags to avoid that'll help
you feel confident every step of the way. Joining me
today is Pam Balonte. She is the marketing director with
(01:26):
Remax of Southeastern Michigan. Welcome back, Pam, Yeah, hi there,
thanks for having me. Oh my pleasure. And since you've
been on before, I will not ask you again how
you got into real estate. Yes, that is for an
earlier issue, so we have that. So but well I'll
ask you a different question. As we're talking about first
time home buyers. Do you remember back to when you
were a first time home buyer?
Speaker 2 (01:48):
Yes, actually I do so.
Speaker 3 (01:50):
So we've bought two homes, My husband and I bought
two homes, you know, in our married lifetime. But when
we first got married, we lived in an apartment for
a couple of years because we couldn't afford a home right away,
so you know, we kind of did the you know,
rent have some money, you know, and then when we
were ready we're there about two years, rent for about
two years before we actually bought a home. But so
(02:10):
I loved it, I remember from my memory, you know,
it was really fun. Yeah, but it was also stressful
because it's a big purchase.
Speaker 1 (02:18):
It's a lot of money.
Speaker 2 (02:19):
It's a lot of money. Yeah, it's a lot of money.
Speaker 1 (02:21):
You're selling a lot of documents too.
Speaker 3 (02:23):
Yeah, a lot of documents that maybe you don't even
really know what.
Speaker 1 (02:26):
It's just put them in front of, say, sign here,
this is really saying that.
Speaker 3 (02:30):
Okay, yeah, yeah, exactly, a lot of language and everything
that you don't necessarily understand. But but I do remember
being very you know, you know, very proud to become
a homeowner. And I was twenty four when when when
I became a homeowner.
Speaker 2 (02:45):
So it was a fun experience, it was.
Speaker 1 (02:47):
And you were a little younger than I was, because
with my husband being in the service, we were overseas
the first few years we were married. Okay, And so
came back home and got an apartment and stagging off
first and then moved down to Metro Detroit and similar
to you, lived down here for two years before in
an apartment before we jumped into homeownership.
Speaker 2 (03:04):
Yeah, yeah, yeah, so similar, very yeah, similar.
Speaker 1 (03:07):
And like I said, it is exciting. It's exciting when
you start to really, you know, kind of hone in
on I think we can do this. You know, we've
saved the money, and then you get to, you know,
have the fun of going to start to look a well,
what can my money get? You know what? You know where?
You know, where can I buy a house? You know
what features am I going to have? And that's kind
of the fun.
Speaker 2 (03:22):
Part of it, right right, right, absolutely.
Speaker 1 (03:24):
Well, while many things don't and it's funny that you
mentioned age, because while many things don't change much from
one generation to another, I think everybody gets that kind
of excitement and that pride, there is definitely one thing
that's changed significantly for first time buyers, and that's the
age of buying the first home. You said you were
twenty four. Yeah, it's interesting that you remember that, because
I'm like, going, well, same, let me do the math.
(03:45):
I was twenty one when we got I got I
was you know, probably mid to late twenties. The average
age now of a first time home buyer is thirty eight.
Speaker 2 (03:55):
Yeah. That is shocking.
Speaker 1 (03:56):
That's the highest.
Speaker 2 (03:57):
It's been shocking to me. Yeah, yeah, yeah, exactly.
Speaker 1 (04:00):
And I think, you know, a lot, a lot goes
into that. I mean, I think we have to recognize that,
you know, the ability for folks to save the money. Nowadays,
it maybe takes a little longer their student debt, that
previous generations really didn't have to factor much of that in.
You know, the cost of homes continues to go up.
I mean, there's been inflation more recently. I mean, there's
a lot of things that kind of drive this. But
(04:20):
thirty eight is that is the average age for a
for a first time buyer. That's a significant change.
Speaker 2 (04:26):
Yeah, that's that's significant.
Speaker 3 (04:27):
That's not even like your late twenties or early thirties,
even right thirty eight, you know, yeah, yeah, yeah, I
think that I have a niece, she's twenty seven. She
got married last summer, but her and her fiance boyfriend
would ever had been living together writing and you know,
their first time home, you know, was over three hundred thousand,
(04:51):
I mean, and it's a small home. That's it's a
starter home, you know, so it's always you know a
lot of people like wow, you know, how can they
afford that?
Speaker 2 (04:57):
And stuff?
Speaker 3 (04:58):
But I think that younger people maybe just accept the
fact that their house payment is going to be.
Speaker 1 (05:05):
It's going to eat up more of their it's going.
Speaker 3 (05:06):
To eat more, you know, whereas there's no way you know,
back when I was buying our you know, when we
bought our first home, you know, I think our mortgage
payment was like eight hundred a month.
Speaker 1 (05:15):
Or it was cheaper. It was cheap, I mean cheaper
than rent, I mean because that was like the hurdles.
Like us, I'm actually paying more to rent than if
I can just save the money for the down payment
and the closing costs and get myself into the house. Yeah,
my monthly not actually goes down right, right exactly.
Speaker 3 (05:29):
So I think it's like almost like a new world
where younger people maybe are just accepting that, like you said,
they're what what they're putting, you know, towards their monthly payment,
you know, kind of just eats into their overall.
Speaker 1 (05:41):
A little bit more more than what previous generations. Yeah,
now you have three, three kids, do you see any
of them buying a house in the near in the
near future. Do you think they're going to be thirty
eight before they get their chance?
Speaker 2 (05:52):
Yeah, well, you know, if they are hopefully they're not.
Speaker 3 (05:57):
Exactly but no, I mean, I hopefully not thirty eight,
you know, but I don't see definitely not twenty four,
you know what I mean. And you know, I think,
you know, one is kind of early into his career,
time to build up his career. One is in college,
about halfway through college, and one's still in high school.
But but I don't see them like in the near
(06:17):
future being able to afford a home.
Speaker 2 (06:20):
And you know, and it is kind of a double
ed sword too, because you.
Speaker 3 (06:23):
Know, I think, you know, especially you know moms, you know,
they old, you know, they don't want their babies to leave.
Speaker 2 (06:27):
But you know, reality is you kind of know that
they need to leaven. You kind of really avention that's
what you want them to.
Speaker 3 (06:34):
But you know, there's also that argument where you know,
like if they went to go rent somewhere, like rent
is really expensive to fifteen hundred, two thousand a month,
well it's almost like we'll stay at home, right and
if you can actually afford that two thousand months, just
put it into us nice little sayings, and now you're
saving for a nice down payment on a home.
Speaker 2 (06:55):
You know.
Speaker 3 (06:56):
So maybe and maybe that's what people are finding you know,
to stay with parents a little bit longer so you
can save that money.
Speaker 1 (07:01):
And I see, I see that. I see that with
some of my friends. I see that with my nephew.
Now he's a little bit younger, he's twenty, but you know,
just got a job in you know, skilled trades, and
you know, it's kind of working his way through that
right now and living at home. And I think, you know,
my sister's been perfectly happy, you know, to say, hey,
look if this allows you to, like you said, save
up some money. I mean, he definitely wants to buy
(07:23):
a house. I mean that is totally on his horizon
and his thinking. But right now, it's okay, getting kind
of settled in the job, saving the money to do it.
And I think you're right, that is going to be
the path for a lot of folks, you know, right now.
Speaker 2 (07:32):
Yeah. Yeah.
Speaker 3 (07:33):
And also what I think is interesting is the one
that's in college and even the one in high school
have shared with me on a couple of occasions that
they actually feel anxiety about being able to be out
on their own, like it, you know, it's a reality
in there. Now.
Speaker 1 (07:50):
That's interesting because I mean you'll you'll read articles or
hear things about that, and it's interesting to know that
that it's for real, you know that that there really
is anxiousness around this, and I feel bad that that's
something that they have to deal.
Speaker 3 (08:01):
With me too, Me too, because I'm like, I never
felt that way. It was just like, Nope, this is
how life goes.
Speaker 1 (08:06):
You do this, you save the money.
Speaker 3 (08:07):
Yeah, yeah, yeah, And it was like there was no
I don't ever remember feeling I mean, certainly during the
home buying process, well some things, yeah, but never.
Speaker 1 (08:13):
Like like I'm not I'm not sure I'm ever going
to be able to do this.
Speaker 2 (08:16):
Was not the.
Speaker 1 (08:17):
Anxiety, right, yeah, right, absolutely. It was the amount of
paperwork I'm signing and yeah, I'm signing something to to
pay for thirty years. I mean those types of things normal.
Speaker 3 (08:25):
Yeah, that's normal, you know, but kind of like that
early and again the one.
Speaker 2 (08:29):
Is still in high school.
Speaker 1 (08:30):
That's really interesting.
Speaker 2 (08:32):
Yeah. So it's I think it's you know, it definitely
is a real thing. You know.
Speaker 1 (08:35):
Well, we can't solve all of those problems today, but
what we hopefully can do is we want to dig
into some things that some first time buyers really need
to know. And the first really does deal with their budget.
We've been talking a little bit about the ability to
afford this, you know, and and the financial side of it,
and the down payment really gets all the attention, right,
I mean, that's that's what everybody talks about. You know,
how much money are you putting down? Have you saved
(08:56):
money for the down payment? And clearly that is important, Yeah,
but there is more to it than.
Speaker 3 (09:00):
That, Yeah, there is really, you know, definitely there is more.
So the earlier you can start saving for the house,
the better because you're going to need more money than
just a down payment. You need to consider things like
closing costs, inspection and appraisal fees, moving fees, and even
homeowners insurance. So these are all above and beyond that
(09:22):
down payment. There might also be fees like a paying
a paying a probation fee for a homeowners association, you know,
if that's applicable you know where you're buying, and maybe
you're going to be choosing to purchase a home warranty,
a home warranty policy. You know, that's additional costs there,
so you know, and I do think first time home
buyders they're not even thinking about these things.
Speaker 1 (09:43):
Now because this is an everyday conversation, right, I mean,
if you've been living at home with mom and dad,
you might hear about the mortgage payment. You may hear
you know, oh, the insurance you know bill came in
the mail of you know, prices went up again. I mean,
there's a few things that might be on the radar,
but unless you've been starting to do some you know,
due diligence and some research on it, there are some
other things that closing costs. What are those things?
Speaker 2 (10:01):
You know?
Speaker 1 (10:01):
I mean, and it could just be slipping past if
it's not something you're doing some research on right right
exactly and having moved recently. Some other things to you
know include you know, like right at the closing, if
you're getting keys at closing, is you know we had
the locks change that day, you know, we had we
had somebody out there that afternoon changing the locks on
the house. Not that I thought that people before it
were bad, but I don't know who they've all given
(10:22):
a key to. And you know, it doesn't cost much,
but again it's another outlay of money at the time
that you're doing all of this. A good rule of
thumb is to have a plan to for you know,
for at least maybe two to six percent of the
cost of your home set aside for other related you know,
house purchasing, you know, in related cost. If you can
kind of plan for that, that's probably a good thing
(10:44):
to do, right.
Speaker 3 (10:45):
I think having that additional saving is going to help
you with any of those unexpected repairs that you know
may come up quickly. And I truly think that. I
mean from the two home purchases that we did, there
were things like almost immediately.
Speaker 1 (11:00):
Yeah, it's like the appliances all put on a good
show while you're looking at the house. Everything works just fine,
and then you move in there like, oh now our
true colors can come. Now we're going to show what's
what's going on out there. Yeah, And I mean hopefully
it doesn't happen to you, but if it does, I mean,
you want to have a little something because you just
never know, right right, So all right, excuse me. Once
(11:20):
you've saved up money and you're ready to start the process,
you really want to meet with the lender. I'm personally
a big fan of meeting in person with the local lender,
so they get to know you, they get to ask questions,
you know, you get to feel comfortable with them, you
can share your situation so that they can come back
with you for the best options that fit your specific situation.
(11:42):
Because maybe you know, maybe there's something you know, maybe
you're maybe you served in the military. A v l
V A loan may be an option to consider. Now,
ultimately that may not be what you choose to use,
but it's an option that can get thrown on the
table that have you know, pros and cons that would
come with it. But doing just the online callulator or
something quick and easy, it's great to put you in
(12:02):
a ballpark of what something's going to cost. But I'm
a big, big, big believer in going and talking to
to a local lender, you know, live and in person.
And you know, if you have a lot of money
at a specific banker or credit union and they offer loans,
maybe you get a better rate because you've already you
already are a client of theirs and that there are
if you already have money with them, you may get
(12:22):
a better rate. Then you're going to get off the
streets someplace else. So I always think it's good to
do that at times, pre qualification and pre approval often
kind of get interchange your reference as if they're the
same thing, and they're not, So can you share a
little bit about what's the difference and you know, maybe
why one's better than the other.
Speaker 2 (12:42):
Yeah, yeah, definitely.
Speaker 3 (12:43):
So a pre pre qualification gives you a very general
idea of what a lender is going to approve you for.
But but with this lender is only going to use
limited information that you provide them. They're not pulling a
credit report, they're not verifying your income, you're jobs, any
debt you may have. You know, these are these are
actually what's done in the pre approval process. So you know,
(13:07):
during that pre approval process there's gonna be a hard
credit check either, going to contact your employers, all kinds
of things to really understand what your financial situation is.
Speaker 2 (13:16):
So that makes you pre approved.
Speaker 3 (13:20):
And I would like to say it can be very
helpful to get pre approved for a mortgage ahead of time,
ahead of shopping for those homes. You know, again, during
this process, they're really gonna, you know, look at your
credit you know, look at your job situation and your
income to really decide how much you can afford, which
is great to know. You want to you really want
to know, like what could I really afford it.
Speaker 1 (13:41):
Before I fall in love with something. I'm out here
looking at this price point. There's not a prayer in
the world. Any letter's gonna suit me for that.
Speaker 3 (13:47):
Yeah, you know, don't even think about you know that,
you know, and you will get approved pre approval letter
and that's usually valid for about sixty to ninety days,
and that does outline how much you are eligible to borrow.
And what I like about this it shows the home
sellers that you are a serious buyer, okay. And then
in a competitive market, you know, where there may be
(14:07):
multiple offers at a home, this is going to give
you kind of that competitive edge, right because you already
are preapproved, you know, you know, the sellers know how
much you.
Speaker 1 (14:14):
Know, yeah, I mean, and a good agent is gonna
be able to say, hey, basically, the only thing missing
is the address of your house in here. They've already
been approved by the lender. The letter is telling them
they will give them a loan for X. They just
needed to pug in the address of the home they're
they're choosing to buy. And that does matter in competitive situation,
which our market seems to be that way. It still
is that way in a lot of ways. Now, something
(14:35):
to point out here is that it's not uncommon for
a buyer to be approved for more than they thought
was possible. And I know this was certainly true for us. Yeah,
you know, I think every time we've bought a house,
and we've bought four, every time we've bought a house,
I always chuckle at what they approved me for. I'm like,
do you not want me to have a life outside
of owning a house? Because it seems like you're approving
(14:55):
me for something that like most of my money would
be going just for the house payment. Me crazy. I
like to do things besides that. So it's not uncommon,
and especially for your first time buyer. I want people
to be aware. You aware of that lenders are using math.
What your income is, what your debt have, what your
credit scores are, you know, all of that. So they're
just using kind of math to figure this out. Just
(15:18):
because you're approved to a certain price point doesn't mean
that that's the right amount for you to feel comfortable spending.
You want to factor in your lifestyle. Do you want
to be able to travel? Do you enjoy maybe entertainment
or eating out from time to time? Are you also
I'm hoping try to save for retirement, you know, putting
some general savings away. You want to decide what you're
comfortable spending and factor that into the equation as well,
(15:43):
and doing some you know, kind of prep for this.
I mean one of the things I had read was
think of it like going to a buffet. You know,
most of us don't go to a buffet and fill
their plate till it's overflowing, right, I mean, you kind
of take what works for you, kind of the same
with this. Take what they're saying and say, you can
be proud if they approved you for something more than
you want to buy, but you want to be realistic
about what you are ultimately comfortable, right, Comfortable.
Speaker 2 (16:04):
Yeah, I think that's good advice for sure.
Speaker 1 (16:06):
Yeah. I remember my sister went through the same thing.
She was buying a house on her own as a
single female years ago, and she called me up after
the she was they approved me for this, and that
just doesn't seem right. I said, well, let's talk. Let's
talk about it. And I think if you haven't been
through this before, you don't know.
Speaker 3 (16:21):
Right, Yes, I agree, I agree, and you get so excited.
I remember that you know you feel so excited. Well,
look what I could afford, you know, but you're not thinking, oh,
I really still need to eat pugasma car and you know,
and maybe do a little travel or whatever whatever else.
Speaker 1 (16:35):
You know, you know, whatever else you've got going on.
You if you want some other discretionary income to be
able to do other things besides literally just live in
your yeah.
Speaker 2 (16:43):
In your house that you overspent or something.
Speaker 1 (16:46):
Once you've spoken to a lender and you have an
idea what your budget is, you also want to be
finding a trusted real estate agent. I mean, and in
in theory, you can get the agent first, and the
agent can certainly give you recommendations to lenders you know
that they know have a good reputation. You know, if
you don't have somebody in mind, you know, on yourself,
you can kind of interchange these first two. But you
definitely want to have you know, a lunder and get
that pre approval and have a trusted agent that you're
(17:09):
working with. And of course, you know, having a trusted
agent is a little something. You know, those of us
that work at Remax are you know, are passionate about.
Speaker 2 (17:16):
We're passionate about I guess we could put our shameless
plug in here. Yep. That we've been voted the number one.
Speaker 3 (17:21):
Most trusted agents in the US multiple times. Actually, yeah,
in different studies. So yes, we do know about the
trusted agent.
Speaker 1 (17:28):
Absolutely, mm hmm.
Speaker 3 (17:30):
So some things you should be looking for when interviewing
your agents is how much experience they have, and they do.
They have experience working in the areas that you are
looking to purchase. They should know the local market inside
and out. And you want someone who's going to educate
you but not overwhelm you. They should have the patience
and ability to explain the process and answer your questions
(17:51):
because it is overwhelming and there are a lot of
questions and.
Speaker 1 (17:54):
You might ask the same question three different times, you know,
because you heard you know, they told it to you
at the front of the process, but it wasn't relevant
at that point in time, right, and then you know,
now you're four steps in, it's like, well, now this
is pertinent. What did you say about What did you
say about that?
Speaker 3 (18:07):
Yeah, yeah, yeah, yeah, definitely. And also look for an
agent that has like a great team behind them, and
that's a team that maybe includes like vendors that you
know that you know vendors for you know, inspection moving companies,
you know that type of thing. You know, they should
have that all in their backpacket that they can recommend
to you.
Speaker 1 (18:27):
That's a I mean, that's a tremendous amount of value
that I think great agent spring and especially agents that
have been doing this a while. The longer they've done this,
the more likely that they've got a really wide, you know,
depth of contractors and vendors that they can refer you to.
Speaker 3 (18:41):
Yeah, yeah, absolutely, And that saves you from doing that, right,
doing all that research on your own.
Speaker 2 (18:46):
So that's value.
Speaker 1 (18:47):
And not just the research, which is in and of
itself something. But I'm just going to go to the
roof situation that that we've had recently at our house
where we had a leak and we needed to find
a roofer, and I contacted our agent and then I
put something out on Facebook cause I knew Darnell I'd
have a lot of agents responding to it. And but
I mean the reality of is contractors and vendors get
(19:07):
repeat business from real estate agents. They tend to jump
when an agent calls. They tend to come out and
get you know, and come out and give the bid
because they get repeat business from vendors if it was
just me reaching out to these people, not that they wouldn't,
but I'm a one and done client, right, I'm getting
one roof in this house. That's it, period the end.
But an agent referring me to me. I've certainly witnessed
(19:28):
this first hand with multiple people over the last year.
Is when my agent recommends somebody, they come out within
a day or two because they want to keep the
agent happy, so she keeps referring business.
Speaker 3 (19:39):
Yes, absolutely, that too, Yeah, yeah, I do love that
for sure. You know, and overall, you want to get
a good feel from talking to your agent because because
ultimately the agent is going to be negotiating on your behalf, right,
so you want to you want to feel that confidence
they're going to be able to negotiate on price, maybe
negotiate after inspection and pairs need to be done, that
(20:01):
type of thing. So you want to make sure that
they have your best interests in mind.
Speaker 1 (20:06):
Yeah, you really do. And I think it's important. You know,
you're kind of laying out what to look for. You
know that they've got this you know, team of professionals.
You know that around them that they have the patience
to answer your questions. If you're a first time buyer potentially,
and we recommend you know, unless you've worked maybe somebody
in the family's worked with somebody who's just the given
person you're going to work with because you know them
and trust them and like them already, that you interview
a couple of agents. You know, find an agent that
(20:28):
is the bet fit, best fit for you, somebody that
you feel there's that this chemistry, a rapport and that
you that you trust them, and you know as you're
talking to agents, if you are going through the interviewing process,
there's some red flags that you can look out for.
If they're encouraging you to look outside of your budget,
that to me would be a red flag. If you
if you're firm, you've got to pre approval and you've
(20:49):
you know, you're taking that into account along with you know,
what you feel comfortable spending, and you've got somebody that's
consistently pushing you far outsid I mean i'd say far
outside that, but I mean just in general, pushing you
outside that. I think that's something to you know, take
a look at are the again, is your best interest
really at heart there? And are they pushing you to
view homes that aren't the right fit. Now, for a
(21:11):
first time buyer, this can I think you're threading a
needle here right, Yeah, because you've never bought a house before,
and it's somebody going to say, well, what do you
need versus what do you want? You know? I mean,
and that can be the answer. I mean obvious things
are how many bedrooms and stuff like that? Do you
need a fence yard? Do you not? Is that important?
As an attached garage important? Is a one or two
guard garage important? I mean there's all these kind of
(21:33):
decisions and it's the first time buyer. You may not
have the clarity that you have buying a second and
third house. Because now that you've been through it, I
think you get a little better at knowing what you're Yeah,
you're once versus me, you're once versus these but as
if you have you know, put out here, this is
what I'm looking for. I need this baby on the way.
We need at least three bedrooms. And they keep showing
you something that's too well, you can maybe you know,
(21:53):
work this other little side room into something. No an
agent should be looking you know, again, red flag if
they're pushing you into something that isn't right. And to
your point, you said, they should be able to answer
your questions. If they're not doing that, or their answers
leave you confused, or you're made to feel that your
questions are a bother, you know, or cumbersome, it's probably
not the right agent. Because you want somebody that is
(22:15):
willing to hold your hand, you know, so to speak,
you know, willing to be patient to answer your questions
the first time, the second time, the fourth time, you know.
I mean, that's what they're that's what they're there for.
They should be making your life easier and smoother. And
if you just feel that every time you talk, you know,
even in the interviewing process, if this is not happening,
it's probably not going to get better, right.
Speaker 3 (22:36):
Right, Yeah, Yeah, I think you'll know. I think you'll
know in that interview process right then and there. And
I yeah, I think it has to be a comfortable fit.
I think everyone kind of knows. It's almost like trust
your gut type of thing.
Speaker 1 (22:46):
Yeah, you know, so you you'll know, you'll know, I mean,
any of those things when you're going through there, if
you're just getting some red flags and something in your
stomach isn't feeling right, Trust the gut, interview someone else
because there is a good agent out there for you.
Speaker 3 (22:57):
Yeah, yeah, right, and there's there. You know, there's no
limit to how many agents you can interview.
Speaker 1 (23:02):
Exactly, you know what I mean. So so take that time,
take the time you're you know, you're going to be
sharing personal financial information with them, Like you said, they're
going to be negotiating on your behalf. You want to
have that level, you know, level of trust. And I
guarantee the right agents out there. And in case we
didn't mention it before, Remax agents we named the number
one of us trusted. That's all I'll say it. So
(23:23):
you have your lender, you have your agent, you know,
kind of on what we're going to call your real
estate team now, right, I mean, because you're building your team.
Your lender is a big part of it. Your agent's
a big part of it. Now you want to start
looking for homes. Now, this to Pam's point earlier, this
tends to be the fun part of the process, but
it can be overwhelming if you don't take steps to
be prepared. So you know, this is a good time
to share some house hunting tips The first tip is
(23:45):
to identify. We just I just mentioned this briefly before,
your needs versus your wants, So how do they do
that exactly?
Speaker 3 (23:52):
So so you kind of think about it as your
must haves.
Speaker 2 (23:56):
Right, your must haves are your deal breakers.
Speaker 3 (23:58):
So when you're thinking of your must haves, you need
to be thinking about, you know, how many bedrooms must
you have?
Speaker 2 (24:05):
You know how many people in your family? How many
bedrooms do you need?
Speaker 3 (24:07):
You know the location of the home, you know, what
type of parking do.
Speaker 2 (24:12):
You do you want? Driveway garage?
Speaker 3 (24:14):
You know that type of thing, the school district, you know,
do you want a ranch?
Speaker 2 (24:18):
Do you want? You know, a colonial? You know? Think
you know these and these are the things that.
Speaker 3 (24:23):
Are must have, So you must have these versus nice
to haves, which things are like they'd be great, but
they're not required. So you know, you think of things
like maybe a finished basement or a fireplace, maybe a
walking closet.
Speaker 2 (24:37):
You can live without them.
Speaker 3 (24:39):
They'd be nice to have, right, but they're they're not
going to They don't they're not required for for what
you need. So being clear on what you need versus
what you want is going to help your agents show
you the homes that meet your needs, so then you
don't spend a lot of time looking at a bunch
of homes that ultimately is not going to do it
for you.
Speaker 1 (24:59):
No, it's not the right fit. Or you fall in
love with something that you're ultimately not going to buy
because you know, I think everybody's done that when you
when you're not as clear and you're seeing kind of
everything that's out there, and usually we fall in love
in the cosmetics. You know, you fall in love with
the way something looked, and now you're not seeing that
in the homes that I actually have the features that
you want. You have to almost like kind of you know,
(25:19):
like divorce and separate yourself from the house that you
fell in love with. But that isn't right for you, you know.
Speaker 3 (25:23):
Yeah, yeah, maybe it's in the wrong school district, the
wrong location whenever. It has all the beautiful things, but yeah,
you know, but it.
Speaker 1 (25:29):
Doesn't check other boxes that you said were you know, important.
And to be honest, for first time buyers, it's okay
if this kind of changes, because when you first sit
down and do it, when you've never done this before.
There are some things that I think are easier than
other bedrooms, I think is a little easier. Typically, you
know what you need is as you're starting out, there's
some other things that you know, you may not really
(25:50):
crystallize on until you've seen a few houses, and then
all of a sudden, it's like it's like, you know,
something kind of flips and you're like, Okay, now that
I've been out there and I've seen some stuff, I
want this. I've decided I do need this. I didn't
articulate this, but now that I've seen a house without it,
I'm realizing I really do need this.
Speaker 2 (26:05):
That's a good point.
Speaker 3 (26:05):
Yeah, it might take a couple couple of viewings to
actually nail nail down you know, some of those.
Speaker 1 (26:11):
Because most first time buyers have either lived at moms
and dad's house, yes you know, or maybe an apartment
you know, or you know, if they went off to college,
you know, a dorm or something like that, and you've
not put a lot of thought into You've just lived
what's been provided or what was available to you, and
you had to take it for what it was right,
like it or not, like it meet your needs or not.
It was where you were living. And now, for the
first time, you kind of have like, oh I get
(26:33):
some sand, Yeah.
Speaker 3 (26:33):
I get some sand it yeah. And you know, unfortunately,
I think the truth is when you know it's it's
neither good or bad. But I think you almost have
to the batter scenarios when you're buying, like your second home,
because once you've actually had that kind of that independence
of being a homeowner and experiencing it, then you realize, oh,
I really do I really do? You know, I really
(26:54):
need that bigger kitchen. Like you you almost get to
narrow you.
Speaker 1 (26:58):
Know, you do it because now you've done it, you've
lived with Because it's so funny you mentioned storage because
when we were looking for our first house, we were
and we were early on just you know, starting to
go out on Sundays, you know, going through open houses
and stuff like that, and we went through this house
and you know, it was kind of the area we
were looking. The price point was right, you know, and
I can remember going through the house and I kept saying,
(27:19):
something's off about this house. There's just something on and
I couldn't put my finger on it. And it wasn't
till we went to the next one was I remember
turning oud look at my husband going there were no closets,
That's what it was. And I was like, it didn't
hit me when we were going through it. But storage,
I mean, and you don't realize until you own a
house how important closets the storage. Yes, yeah, yeah, exactly.
Speaker 3 (27:37):
I think that's probably like a number one thing you
realize after you live in your first.
Speaker 1 (27:41):
First time buyers and that wasn't on your list, pay
attention when you're going through homes. Do they have closet space?
Is there some storage space? I mean even in the
more smaller footprint homes, because our first home was under
a thousand square feet, Yeah, you know, but if you
have an extra bedroom and that has the closet way, hey,
bingo storage.
Speaker 2 (27:58):
Yeah yeah, yeah, yeah, yeah for sure.
Speaker 1 (28:00):
So what are some other things that first time buyers
should keep in mind when looking at homes?
Speaker 3 (28:05):
Yeah, so, you know, if possible, drive the neighborhoods, you know,
in the area that you're interested, you know, and do
that at different times of the day and at different
days of the week. This is way you can pay
attention to kind of traffic flow, noise, you can pay
attention to, you know, the different you know, adjacent homes
and yards. Just kind of get a feel for what's
happening on the outside of the neighborhood, if you will.
(28:27):
And then when you're actually going inside homes that are
for sale, you know, don't get distracted by the sellers
decor or the stuff that they have laying around, or
maybe the way the house is staged. Focus on what matters,
you know, again, some of the stuff that the needs, right,
you know, lay out natural light, you know, and for
sure the condition of the house, you know, the major
(28:48):
you know, pieces of the house, components of the house
and everything, you know, structure and that type of thing.
Speaker 1 (28:51):
Yeah, because I mean, like I said before, I think
it's the cosmetic stuff that often captures our attention. Most
of us are emotional people, right, I mean, so we
we you know, things are ted by color and smell
and you know, different things like that, and we fix
you know, we kind of get fixated on oh I
really like the light fixtures, or I really liked the
color of the kitchen. But the reality of it is is,
(29:12):
you know, whether you like it or not, that can
get changed. What can't get changed is the natural daylight
that it gets, you know, or the location of the
house in the subdivision, or do you like a north
facing house versus a south facing house. Things like that
you cannot change so that you really do want to pay,
you know, pay attention to. So many buyers are looking
for something that is move in ready, in other words,
(29:33):
it doesn't require a whole heck of a lot of work.
But sometimes a fixer upper it can be a good option,
especially for a first time buyer. So what would what
were some things to consider there?
Speaker 3 (29:44):
Yeah, so a fixed opper can be a good option.
A fixed opper is technically a home that needs some updating.
And this could be you know, something simple like, you know,
fresh coat of pain on all the walls, you know,
fresh carpeting or hardred floors, you know that type of thing.
But a fixed opper could also mean maybe more of
a significant overhaul, right.
Speaker 1 (30:03):
Yeah, that would be the phrase handyman special.
Speaker 2 (30:05):
Yeah, yeah, special exactly.
Speaker 3 (30:09):
But the reason why it's a good option is that,
you know, purchasing a fixer upper will likely come at
a lower price point, and it also gives you the
opportunity to customize the house the way that you want it.
So it's almost like, you know, get you get to
put your own footprint in you know right away. But
on the flip side, you do have to consider the
time and the money and the cost right that it's
(30:32):
going to take you to do you know, those repairs
and those updates.
Speaker 2 (30:36):
So it's a you know, you have.
Speaker 1 (30:37):
There's a trade off.
Speaker 2 (30:38):
There's a trade off.
Speaker 1 (30:38):
There's a trade off, I mean there is. And if
you opt for a fixer upper, you really want to
pay attention to the home inspection because again, paint, that's easy,
that's a that's a cosmetic choice. You want to take
a look at the home inspection, really understand the full
scope of repairs needed. And to your point, how does
that match with your budget? You know, we've talked about
you your approof for this, but what we're comfortable spending. Okay, well,
(31:01):
you've got your mortgage payment. Now, if you're going to
do a fixed rupper, there's going to be ongoing costs
until you make some of these repairs that you're talking about.
You know, can you get the home for you know,
a low enough price point that it you know, adjusts
your monthly mortgage, so you've not got the flexibility to
you run into you know a lowser a home depot
you know, every week to buy what you need to
buy to, you know, do what you need to do.
(31:23):
But while it can present challenges, it can also be
incredibly rewarding. You're going to feel like this house is
yours when you get it to the point, you know,
of making the changes that you want to do. So
you know, this will be for some people, it won't
be for everybody, but it is an option.
Speaker 2 (31:36):
It is an option.
Speaker 1 (31:37):
Yep, yep. Speaking of inspections, that is an incredibly important
part of the home buying process. What do folks need
to know about that?
Speaker 3 (31:45):
Yeah, so a home inspection identifies issues that may not
be readily apparent, such as structural problems or faulty systems.
Speaker 2 (31:53):
You know.
Speaker 3 (31:53):
But items found during an inspection can be used to
negotiate a better purchase price, or you can request to
have the repairs.
Speaker 2 (31:59):
Done before closing.
Speaker 3 (32:02):
What I like about the inspection It does ultimately provide
a roadmap about maybe some future repairs that you would
have in the house, and they kind of plan accordingly
that way, you know. And it is important to remember
that that it's not uncommon for an inspection to find
some things. Absolutely, I don't think any house is going
to be inspected and it's going to get.
Speaker 1 (32:24):
There's absolutely nothing that needs to be done.
Speaker 3 (32:26):
Right right, So I think first time home buyers need
to really be aware or not get freaked out by
their inspection report, you know, you know, and some of
the items are relatively easy to dress, like again, calking,
you know, walking around windows, you know that type of.
Speaker 2 (32:40):
Things, easy, easy to fix and stuff like that.
Speaker 3 (32:43):
But even if more significant things are found, it doesn't
mean you need to walk away from the deal, you know.
And I think because you do have that opportunity to
have them fixed before you closed or asked for those
concessions you know, in the purchase price.
Speaker 1 (32:57):
So no, and I think you're absolutely right, and that's
something to keep in mind as a buyer. I mean
you're thinking, Bye, I'm spending all this money and now
they just gave me this fifty page report. Yeah, that
list you know, stuff that's wrong with the house quote
unquote wrong you know with the stuff or the house,
and you know all these things I should be doing well.
And a good agent will help explain this. They'll kind
of come up, you know, and they will help kind
of guide you through all of this. Part of the
(33:18):
inspector report is going to be truly things that the
inspector found. They can be minor little things to something
that is a little bit more significant that may need
to be addressed in the short term. There is another
section typically of most home inspector reports that is future maintenance.
You know, we're just pointing this out. You're fine now,
but you might want to consider in the next year,
or in the next couple of years, or your roof's
(33:39):
got you know, a lifespan of five years left on
it from what I'm seeing right now, So some of
it is the here and now, and some of it is,
like you said, it's almost like a roadmap or future
guide as so well, if every year I take this
out and kind of look at it during maybe my
spring and my fall maintenance, you know what else can
I take off of this list that they're suggesting I do.
It can kind of help you be a roadmap. But
(34:00):
if you've never been through it before, and you've paid
a few hundred dollars to have an inspection done or
more depending on you know, the size of the house
and what you're all having done, is you get this big.
You know, they don't get buyers anymore. It's all digital.
But I mean, you know, you got this big report back.
You're like, oh my goodness, all I see is issues.
Yeah yeah, take a breath, take it, take a breath.
Speaker 2 (34:20):
Yeah yeah.
Speaker 3 (34:20):
And again I think, I you know, I guess, and
I'm probably basing it on my memory, but like as
a first time home buyer and you see that and
it's just like, oh my god, you know this house
that's got so many issues, but it's not really like.
Speaker 1 (34:32):
It's typically not. I mean, and if it is something
that is a big deal, your agent's going to know,
and like you said, now we go into negotiation mode.
If it's a big enough issue, a costly enough issue
that this is why the inspection's there is it does
give you the ability to say, hey, this is big
enough that either it gets fixed before we close, or
I get some money back and I'll fix it myself.
Because that's that's part of it too. You know, how
much do you trust the sellers? You know you're getting
(34:53):
a good vibe from them that they're going to fix
it and fix it to your satisfaction. Are you better
off negotiating a price down and saying you're going to
fix it, and you pick who comes in there and
does it pulling off of my recent home purchase a
year ago. We wanted to do the stuff ourselves. The
house was owned by investors, doesn't mean that they're bad.
They didn't live there, right, and you know, they just
wanted to get rid. It was clear they wanted to
(35:14):
sell this and move on, which is fine. I didn't
trust that they cared as much about who was going
to fix this and how as I was going to care,
you know, being the one living in there. So we're like, no,
we would rather bring that price down. We'll find our
own people to come in. But you know, every situation
is every situation is different, absolutely, So again you're going
to re review all this with your agent, let them
(35:35):
talk to you about what's kind of normal in the area,
you know, and then but then again you can use
this as a negotiation, you know, not a not a
jumping off point typically any parting advice that you have.
I mean, there's a lot more, honestly, that we could cover.
I mean we're kind of trying to keep the shortened
to the point. Get a lender, get pre approved, get
your agent wants and needs, have the inspection done, you know,
(35:55):
I mean there's a lot you know, deeper. We could
go on this, but we're kind of keeping a high
level today for this conversation. But is there anything else
the first time buyer like any parting things that they
wouldn't think.
Speaker 2 (36:04):
That they wouldn't think of. I think this is a
good one.
Speaker 3 (36:07):
Save the package of documents that you get at closing
because you will need them for taxes.
Speaker 1 (36:14):
Yeah, for first time buyer, this may be a different
concept for you as well, because you're just used to
taxes coming out of maybe payroll or if you're an
independent contractor, you know, your estimated quarterly payments, that's your
version of taxes all. But when you own a home,
you know, it kind of opens up a whole new
potential door or opportunity, depending on how you look at it.
You own a home, you know, typically there are things
that can now be deducted off of your taxes. The
(36:37):
interest that you pay your mortgage is one of them.
That is a often huge benefit for people. But the
year that you buy and sell a home, there can
be tax ramifications. And it's easy to say, boy, this
is kind of old fashioned. They gave me this, you know,
folder full of a bunch of stuff I signed at
the closing table. What am I supposed to do with this?
It doesn't fit anywhere, But you do want to save
it because there is information in there that you may
(36:58):
need for your taxes the funding year.
Speaker 2 (37:00):
Yeah, I think that's a great point.
Speaker 1 (37:02):
Yeah, And just gonna say I I had to dig
out both packets recently doing our taxes because in our case,
you know, it wasn't a first time buyer, it was
it was you know, a subsequent move, and it was
now like, well, now we've made money on the house
we sold, but I was proving that we didn't make
so much as to have to pay attack capital gains.
Speaker 2 (37:19):
Tax on that. So there you go.
Speaker 3 (37:21):
See, right, all kinds of nuances no matter we are
in the in the cycle, in the process process.
Speaker 1 (37:26):
But yeah, its first time buyers. They're giving that that
for a reason. You absolutely want to keep that information
now and in the future. That was going to be
helpful to you, So don't don't.
Speaker 3 (37:35):
Just Yeah, and they are large, they're kind of odd shape,
I agree, But find a place, find a place find ale.
Speaker 1 (37:41):
Yeah, exactly, find some place to stash it, because you're
gonna you're gonna thank us for this about a year
from now.
Speaker 2 (37:47):
Exactly so.
Speaker 1 (37:48):
Purchasing a home. It's an incredible achievement that comes with
many benefits, and it comes with a learning curve, no
doubt about it. Doing anything big in life the first
time you know you're going to learn a few things
along the way, give yourself some grace, Recognize you aren't
expected to know everything right away. You're taking a big step,
and celebrate the wins along the way. Saving the money
to buy the house, that's a win. Take that as
(38:10):
a wine. Pass yourself on the back. Getting pre approved
a win, you know, pat yourself on the back for that.
Finding the right agent, searching for the home, all of
those are steps in the process that it's okay for
you to have the little Bouhu dance and be proud
of yourself. They're all important steps. Enjoy as you go
through it, and then as you find the home and
close on the home and move in, we certainly wish
(38:32):
you all the best, you know, as you start that
chapter of your life. Yeah. Well, thanks to Pam Belonte
for being my guest today and is always a big
thanks to all of you that are listening. Please feel
free to share this podcast with any potential first time buyer,
you may know, you know. If you're a parent, a grandparent,
a loving aunt or uncle that may be listening to this,
(38:54):
and you've got somebody kind of coming up and thinking
about buying a home, please do share this with them.
We're happy to pass the information on to as many
ears as we can get it too, and we look
forward to chatting with you again soon. We hope you
enjoy today's episode. Don't forget to subscribe, write a review,
or rate the show, as it helps us reach more people.
You can also follow us on Facebook and Instagram.
Popular Podcasts
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
On Purpose with Jay Shetty
I’m Jay Shetty host of On Purpose the worlds #1 Mental Health podcast and I’m so grateful you found us. I started this podcast 5 years ago to invite you into conversations and workshops that are designed to help make you happier, healthier and more healed. I believe that when you (yes you) feel seen, heard and understood you’re able to deal with relationship struggles, work challenges and life’s ups and downs with more ease and grace. I interview experts, celebrities, thought leaders and athletes so that we can grow our mindset, build better habits and uncover a side of them we’ve never seen before. New episodes every Monday and Friday. Your support means the world to me and I don’t take it for granted — click the follow button and leave a review to help us spread the love with On Purpose. I can’t wait for you to listen to your first or 500th episode!