The Carr Home: The House Buying Process
We did it. It’s done. We somehow went through the most emotionally draining, rollercoaster of becoming homeowners. If you follow me on any form of social media, you’ll know that this was the hardest thing we’ve done since we got married, for so many reasons. I had absolutely no knowledge of the house-buying process going into it, besides from what I had seen on HGTV. Newsflash: buying a house in real life is NOTHING like House Hunters. So, I want to share our process on HTC for anyone who is getting ready to buy a home down the road in hopes that it might help someone else not feel so blindsided by the process like I was.
The Start
Dustin and I officially decided we were going to buy at the end of last year, but we originally were planning on buying a multi-family home. Dustin had a partner who was going to put up most of the cash for a multi-family property and we would live in one of the units and rent out the rest. Even though this wasn’t my ideal situation, I knew it was Dustin’s goal to own rental properties and wanted to support him in that.
However, by the end of December, things changed and we decided that we would no longer go forward with the original plan. We decided we were going to move forward with buying a single family home and started looking into those options. We had already gotten preapproved for an FHA loan and knew what our budget was going to be and we thought that since we were first-time home-buyers, that we wouldn’t qualify for any other type of loan.
I talked about this in more depth in my house hunting update, but house hunting in Utah is not a simple or leisurely type of activity. The market here is hot and competitive, with houses having multiple offers on them within days of them being listed and going under contract within a week. There is no back and forth negotiations - it’s “give us your highest and best offer by 5:00 today and we’ll pick the best offer from the 5-7 offers we get.”
Dustin and I physically looked at over 12 houses, fell in love with at least three, and were outbid every time. Each house had been on the market for a minimum of 2 days and was under contract within the week. It got to the point where we had our agent putting in offers on houses we hadn’t even seen because we felt like there wasn’t a point in going to look at houses unless we actually had an accepted bid.
We had been looking for almost a month and were quickly approaching the end of our lease at our apartment. We finally decided that if we didn’t have any accepted offers by Friday, February 20th, we would stop looking and find an apartment to live in for the next year. Friday came around and we had no news, so we decided to spend Saturday looking at apartments. However, Saturday morning arrived and our agent called saying that our last blind offer on a house had been accepted (beating the next highest bid by pennies.) We immediately went and toured the property and it was by far the nicest house we had seen throughout our whole search. The second we walked into the front door, it felt different. It felt like our home.
Under Contract
Once we found out that we were officially under contract for our house, we immediately got to work on the next steps. I thought that getting our offer accepted would be the most stressful part, but the due-diligence period was equally stressful.
We first had to get the house inspected and cross our fingers that nothing too major was wrong with the house, or else we would risk overpaying for a house that would need more things to fix. My friend, Shannon and her husband had to back out of their first house after the inspection came back with some major electrical issues. Since we were going with an FHA loan, we were also worried that we would have to put more money into fixing minor things that we wouldn’t have to fix otherwise. With FHA loans, the home has to have certain safety regulations met in order to get the loan, such as handrails around stairs and railings, etc.
Thankfully, our inspection came back okay. It was pretty overwhelming to look at initially because inspectors write down EVERY. SINGLE. LITTLE. THING. But, when it came down to it, there were only two major concerns we needed to address: the roof and the furnace.
We had our real estate agent schedule an HVAC technician, a roofer, and a contractor to come out to the house three days after we got the inspection report to give us estimates on repairs and to look into the possible furnace problem. I was a nervous wreck all morning, thinking that we would have to back out of the house if we found out it needed a new heating system. Thankfully, the HVAC technician said that the furnace just needed a good cleaning and would be good to go! The roofer said that we had about 3-5 years left in our roof, and even though that isn’t ideal, it was better than being told it would need to replaced this summer. So, with the inspection out of the way, we moved on to the next phase: the appraisal.
Normally, the appraisal isn’t a huge stressor, but in our case, it was. In order to get our offer accepted on the house, we offered 12K over asking price. We beat out the next highest offer by literal pennies. However, if the appraisal came back under our original offer, we would have to try to renegotiate our offer or make up the difference between the appraisal and our offer, because banks will not give you a loan that is larger than the appraisal.
Since we were working against the clock with our lease being up in 2.5 weeks, we paid an extra 125 dollars to get our appraisal rushed. We got the appraisal back 4 days later, and, once again, I thought we were going to lose our house. The appraisal came back at exactly what the original asking price was (12K under our original offer.) We did not have an extra 12k to add on top of our downpayment to buy the house, nor did we want to pay 12K over what the house was worth. So, we anxiously re-wrote our offer and said we would pay the full asking price without asking them to fix the roof or pay for the furnace cleaning and held our breaths. I also wrote a letter to the seller introducing our little family, telling her house much I loved her house and included a family picture, hoping that it would help her understand how much we wanted her house and assuring By this time, we had exactly one week until we had to be out of our apartment and I hadn’t started packing because I was waiting to hear if we were getting the house (and I didn’t want to jinx it.)
So, we waited anxiously for one long day while our agent went back and forth with the seller’s agent, hoping and hoping that we wouldn’t have to back out of a house that was SO close to being ours.
We finally got the call from our agent - the seller’s accepted our new offer with no counter! Dustin and I both cried so hard - we were so relieved that we wouldn’t have to give up our house and that the process was finally at an end.
Our Loan Situation:
When we were originally planning on buying a multi-family home, we had gotten prequalified through a mortgage broker. He told us that we had a better chance of getting prequalified for a larger amount of money for a duplex/fourplex if we applied for an FHA loan. Since we were first-time home buyers, we thought this made sense and applied for that loan.
The day we found out our offer had been accepted was the same day that my boss put us into contact with some of her friends who were in the real-estate industry. That led us to a different lender who told us that we could qualify for a first-time home-buyers grant to help with our down payment! We were thrilled at the thought of having 7500 dollars to put towards our down payment and spent a solid two days getting all of our paperwork together to switch lenders.
However, about a week into getting the loan underwritten, we got the initial paperwork showing that it would be just under 20,000 dollars cash to close. The loan also showed that we would be paying close to 1800 dollars a month for our mortgage because we would have to pay for Private Mortgage Insurance.Both of these numbers were a LOT higher than our original calculations and made me sick to my stomach thinking we would have to empty out our savings completely and have no money left over for some appliances. We thought we were backed into a corner and that, because this lender was offering a grant, we wouldn’t find a better loan anywhere else.
Thankfully, Dustin decided to check in with our original broker and ask if the numbers seemed on par with what he thought. To our delight (and surprise) he said that we shouldn’t even be using an FHA loan at all! We qualified for a conventional loan that would require us to only put down 1% and the lender would make up the other 2%! We would only need to bring 6,000 dollars cash to close, saving us over 10,000 dollars. And, because the loan wasn’t an FHA loan, we wouldn’t have to pay the PMI, lowering our mortgage payments by a significant amount. We couldn’t believe that we almost went with a lender that would have cost us so much money and immediately started the process to move back to our original lender.
This was a tiny bit stressful since you typically do not switch lenders when you are already under contract for a home. But, since we were switching away from an FHA loan that required additional safety renovations, we hoped that the seller would be willing to work with us and not back out. Thankfully, we didn’t receive any push back from them and we were able to secure our conventional loan AND afford a brand new washer, dryer, and refrigerator.
Timeline -
By our sheer willpower and thanks to our amazing agent and broker, we were able to close on our house on March 21st - the day our lease officially ended. Thankfully, our apartment manager gave us until the weekend to move out so we weren’t super rushed.
So, now we are homeowners! Rosie Roo has a back yard to play in every day (and tries to bring all her stuffed toys outside with her every time I open the door.) Our neighborhood is quiet and feels homey. I can actually paint my walls and make my office completely my own without having to share it with the guest bed!
It still feels surreal, that after all these years and 6 moves across the country, to think that we OWN our house and can put some roots down. As stressful and emotionally exhausting as this process was, I’m so glad that we did it and grateful for a husband that worked SO hard to save up so that we could actually have a space of our own.
So, here’s to never giving up, for standing up for yourself and your money, for chasing dreams, and to all of you who have supported me during the last three months. HTC has suffered a lot while going through this process, but I’m grateful to know that I can come back to my space here and know that I have friends still waiting for me. I can’t wait to share some behind the scenes of our new home and to start decorating (on a budget!) Let me know if that’s something you’ll be interested in reading about down the road!
