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East Coast Bubble Boys's Saga (How he got his first house)
invite response
2012 Nov 17, 9:14pm 9,560 views 25 comments
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Tenpoundbass
2012 Nov 18, 3:00am
3) Do you best to think of everything
In my experience trying to think of every thing when it came to applying for the mortgage. Only led to frustration. No matter how much paper work I would print up and send along with a request.
I would get call backs at the most inconvenient time to provide that same information all over again. Usually meant I had to start from scratch all over again to include any data that may have changed in the 24 or 48 hours since I last sent it.
Closing on my Mortgage was the single most stressful event I've ever been subjected to. If I had to do it all over again. I would be more aloof, and only forthcoming when asked for information.
Trying to guess what would be required and preemptively providing it, only seemed to place me under more scrutiny.
God forbid a process should be efficient
EastCoastBubbleBoy
2012 Nov 18, 7:36am
For some more perspective.... we can fit almost all of our stuff from our current apartment in the two car garage at the new house.
Although some will tell me that we overpaid, our $/ft2 is actually less. (Comparing the square footage of our current apartment as compared to the house we are moving into.)
EastCoastBubbleBoy
2012 Nov 18, 7:57am
OK.
Rent: $1,440
Size: 1,150 ft2
Cost: $1.25/ft2
House
PITI: $2,550
Size: 2,400 ft2
Cost: $1.06/ft2
The house is 10 minutes away from where we are now. Both are in the same school district. House is in better condition, and was built slightly more recently. (apartment rental is circa 1970, house we just purchased was built in the early 80's)
@ Darrell. I appreciate you concern for us but 1) you have no idea where we live 2) thus you have no idea as to wether or not we overpaid, underpaid, or hit the mark dead on.
Despite conjecture, I have never fully disclosed my location. The east cost is a big place.
TechGromit
2012 Nov 18, 10:03am
And the lesson you're going to learn?
You paid a massively inflated price for a house in an economic dead zone where property taxes are going to bleed you dry for decades to come.
A little presumptuous of you. You don't know how much he paid or where he purchased, so my conclusion is you firmly believe Everyone overpays.
TechGromit
2012 Nov 18, 10:17am
When you're paying in excess of new construction costs, you're overpaying.
This would imply that all land has no value.
TechGromit
2012 Nov 18, 10:30am
It doesn't "imply" anything but now that you mention it, land isn't worth much.
It doesn't? Your asserting that the value of a property is ONLY Worth how much construction costs are to build a house (or office tower) on it. That's Exactly what you said. So if property is only worth what improvements it has on it (ie buildings) then a property with no building has no value, you said it not me. It really doesn't matter if the house is in downtown Manhattan, Beverly hills or in the middle of the Sahara desert, from your statement, the same house has the same value regardless of location.
EastCoastBubbleBoy
2012 Nov 18, 10:42am
@TechGromit
To hijack my own thread. I'm glad to see your back. How did you and yours fare with the storm?
Bigsby
2012 Nov 18, 11:35am
You're cherrypicking. Don't be foolish.
Land has very little value...
That may be true on the planet you inhabit, but back here on Earth...
Bigsby
2012 Nov 18, 11:48am
That may be true on the planet you inhabit, but back here on Earth...
Get used that reality too my friend. Land isn't worth much, if anything.
And yet when I consider say London and all those old Georgian terrace houses that occupy very small lots and that you seem to believe have depreciated massively in value because, well, they're old, and that can actually sell for many millions, I think to myself that Darrell is full of shit.
Bigsby
2012 Nov 18, 12:00pm
You're not in London.
Did I say I was? Are you now saying that your post does not include London, or..., or...?
Bigsby
2012 Nov 18, 12:04pm
YOUR little lot of dirt isn't worth a penny. Deal with it.
Ah yes, houses in Monterey are incredibly cheap. You should come here and buy 10 with your monthly wage.
elliemae
2012 Nov 18, 12:10pm
1) Techie, how did you weather the storm? Ya'll okay?
2) I, too, have a good idea of where ECBB lives... I've narrowed it down to the area between Florida and Maine. BTW, I'm impressed that you were able to find a place with acreage considering that the entire East Coast is wall-to-wall houses.
3) Twelve acres? Awesome! Especially considering that you were able to find the right place without changing school districts. FYI, the house will feel like a mansion for quite some time...
Congrats.
Bigsby
2012 Nov 18, 12:13pm
Ah yes, houses in Monterey are incredibly cheap. You should come here and buy 10 with your monthly wage.
You won't have to worry about Monterey either..... "bigbsy".... lmao
And why would that be?
lostand confused
2012 Nov 18, 10:37pm
That is not bad for 12 acres, though I don 't know what houses go for in your area. How is the soil-can you grow anything? Don't know much about the east coast-but presuming water should not be a problem, if you are interested?
everything
2012 Nov 18, 11:15pm
That's nice that you got some dirt. With food prices, and especially organic vegetables you could quite easily be moving ahead from that perspective. Especially by canning, freezing, and barter, not to mention longevity of your life. You could probably even get yourself some chickens. Don't rule out planting fruit trees, as well as other trees. Find cheap ways to get/buy trees, even transplanting them is not to difficult, which is pretty much required to propagate fruit trees. Just don't plant any giants close to your house or drain field
The $2500/month comes out to about a million over 30 years, your payment is about equal to my monthly take home pay but I'm sure your salary structures are completely different than the midwest.
Well, congratulations eastcoast. We too bought our first home about 6 months ago. It was scary but I'm glad we did it. Enjoy it.
TechGromit
2012 Dec 20, 1:01am
@TechGromit
To hijack my own thread. I'm glad to see your back. How did you and yours fare with the storm?
Storm? What storm? Oh you mean that day when it was a little windy. No damage, but one tree snapped at the base and fell into another tree next to the driveway. I used my car to pull it down so I could safely cut it up. I live at few miles from the Bay, and I'm on high ground. If my house was flooded due to a hurricane, half of South Jersey be underwater. I did lose power but found it again after 54 hours. I had a generator running about 52 hours of that time, Ran the refrig, TV, few lights and space heater for the babies room.
Fortunately where I live in South Jersey, damage was minimal, some flooding, minor wind damage. Atlantic City, Ocean City and Wildwood will be open for business as normal come summer time. The same can't be said for anything north of Brigantine. Long Beach Island got hammered, Seaside's boardwalk got completely destroyed. I predict heavier crowds, more traffic and higher rents for South Jersey shore towns open for business in the summer.
TechGromit
2012 Dec 20, 1:08am
2) I, too, have a good idea of where ECBB lives... I've narrowed it down to the area between Florida and Maine. BTW, I'm impressed that you were able to find a place with acreage considering that the entire East Coast is wall-to-wall houses.
Well that's a generalization if I ever heard one. Even Staten Island has considerable amount of undeveloped land. I was surprised myself seeing a google map shot of the island. A good 20% or more of the island is trees, not sure if it's parks or what. Were I live in South Jersey, most of the middle of the state is completely undeveloped.
elliemae
2012 Dec 20, 2:21pm
Well that's a generalization if I ever heard one.
Thanks, I was going for generalization. It's what I was responding to.
Heck, how did I miss this thread... made me embrassed.
First of all, congratulations!
It's almost 3 am, too late for me to write anything at this moment, will back later to write more. Before that, can you tell me what of the house made you sold except the fact it has 12 acres (holy...!!!) of land? I am asking this because it feels like you had particular style/priority in mind when it comes to the house itself, and I wonder what that would be. It feels like, karma exists.
EastCoastBubbleBoy
2012 Dec 26, 5:58am
Priority was (more or less in order of importance)
1) Relative value for the money
2) Well built
3) Sufficient space (we skipped right over starter house and went right to a house we can live in for ten years or more)
4) Age - (our preference was that to buy something that was not more than 50 years old)
relative value was the hardest part. There is almost always a greater fool willing to pay more. They key was getting in first, which means being a bit aggressive. Every step of the way I had to follow up, stay on peoples A$$ and make sure that stuff got done on time and correctly. Looking back on it there were plenty of points along the way where the deal might have gone to heck, but thankfully we managed to stick to our guns, and got (mostly) what we wanted. Sure I would have liked to have paid less for it, but I felt the price was fair based on where it was, what it was and how much it needed put into it.
TechGromit
2012 Dec 27, 4:14am
4) Age - (our preference was that to buy something that was not more than 50 years old)
Hey don't knock 50 year old houses till you tired them. :) My first house was built in 1950, it was 49 years old when I brought it in 1999. It was better build then most of the crap they today and try to pass it off for quality construction. The electrical system needed some updating, but other than that, I was happy the 7 years I lived there.
Were I live in South Jersey, most of the middle of the state is completely undeveloped.
Although in all fairness a lot is the pine barrens which is pretty restricted for development. I like south jersey. Misspent tons of time windsurfing from trixies to lakes bay (see Jim Karabasz's shop behind the comfort inn if you want to learn to windsurf) to corsons inlet and exploring dirt trails around the pine barrens. Not to mention just a touch of partying from seaside to wildwood. Enjoy your new house.
Now that its finally come to its conclusion, I can give an overview of the saga as it pertains to my first home purchase.
It all started in the summer of 2010. (Actually it probably started earlier than that – we first saw the house on the MLS when it was a new listing – but at that time, the price far exceed the value.) The ad had one picture of the front of the house. No interior pictures. This automatically raised a red flag with us. Our experience is that anything that only had one photo was usually a train wreck in need of major rehab – particularly given the price range in which we were looking. That said, after having it keep coming up in our searches for month after month, curiosity got the best of us, and we finally decided to give it a look.
Now keep in mind that for the longest time, I was always looking for something with land. (I almost bought a 20 acre parcel back in 2004 with an intent to flip it, but that’s another story entirely). This particularly house had land (about 12 acres) which is why it kept catching my eye.
So we went and saw it. To our surprise, it was well built, and in good shape overall. Granted it needed some cosmetic work and updating, but it wasn’t the disaster we had envisioned. After much discussion, my wife and I decided to make a low ball offer on the place – we knew that it was due to go to foreclosure a few weeks later, so we figured maybe the bank that held the note would bite at a lowball number.
Sadly, our offer was not accepted. But the foreclosure never occurred. The owner declared bankruptcy, literally a few hours before the auction was supposed to be held. That put the breaks on everything.
Although we moved on to other houses, I kept checking the status of the bankruptcy proceedings, just in case. Finally, in the fall of 2011 (almost a full year later) the bank that held the note on the house petitioned the judge to throw out the case. It seems that the owner had been self employed and was unable or unwilling to furnish tax returns to the courts. So, in December of 2011 I attended my first auction at the courthouse steps.
That in and of itself was a learning experience. First, the referee overseeing the sale mistook me for the bank’s representative. (I was the only on there, and I was wearing a newly pressed suit and tie.) Although I thought I was about to get what I was looking for, it turns out they could not start the proceedings until the plaintiff was present.
Secondly it turns out that minimum bid is irrelevant. The bank opened with a bid of, I kid you not, $200. Realizing what was going on, I threw a bid out of $500. The bank’s representative go so agitated that he countered with the “minimum bidâ€. And with that, the bank took back the house.
The next morning I faxed an offer directly to their attorney. After about a month of follow up without any reply form them, I called the bank directly. Thankfully it was a small local operation, and I was able to get the person handling the file on the phone. They had never seen my offer. Intense negations’ began. Although initially we were almost $100,000 apart, I was able to close the gap and they came down significantly more than I went up. All of this was pending inspection of course. And we couldn’t get in there until the previous owner vacated (he was still living in the house). It was early April that I finally was able to do our inspection.
At this point I expected the thing would be trashed. Looking back on it, every foreclosure I had ever seen had at a minim, busted walls and missing appliances. Strangely, this house looked almost exactly as I had remembered it. No undue damage by the evictee on his way out. He even had finished the master bath that was only half done the first time I had seen the property.
I did do my best to renegotiate the price – it turns out that by that time, there was a backup offer on the property (which I was able to independently verify) so I had very little leverage, but was able to get some concessions with respect to some of the immediate work that was needed, including the removal of an underground oil tank. (which had it leaked, would have killed the deal, but thankfully, there were no issues).
So now here we are at the start of summer, ready to do a few minor things and then we could close. But summer resulted in delay after delay. This guy was on vacation, that guy was unavailable, etc. etc. The offer was also predicated on a survey. What I thought would take a few days took six weeks. That’s my fault as I was told up front it would take that long, I just didn’t see how. Now I do.
So by the time fall came around and we were ready to close, it seemed as if we couldn’t get peoples schedules lined up. We finally set the closing date for the end of October only to have it delayed by the storm. So now, finally, a little over two years later, our quest has ended.
Lessons learned?
1) Be persistent
2) Double check, then triple check – had I not been diligent, mistakes in paperwork WOULD have occurred.
3) Do you best to think of everything – we wanted to make darn sure we knew what we were getting into, particularly given that it was a foreclosure.
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