Kelly’s First Home: Building the Dream Team
Let’s Start From the Very Beginning
My husband and I finally agreed on a town - one close enough to commute into New York City, close enough to our families, great schools, great community, and also a great investment.
Wow, that took long enough. Now what?
I thought I knew the key players - realtor, real estate attorney, mortgage broker, inspector - but what were my first steps? Who do I contact first? Can I even afford this?
Some Background…
At the time my husband and I bought our first home I was working at JPMorgan in NYC’s Financial District and my coworker must have seen my eyes lit up when she told me she and her husband recently purchased their first condo. “Yes!” I thought, “she can tell me everything.”
Luckily, my coworker was someone I knew who was very smart, a critical thinker, and trustworthy. We set up a meeting at lunch, I brought my pen and paper, and she outlined the WHOLE process for me. My coworker. At lunch.
Building The Dream Team
Realtor
I think one of the biggest fears of home buyers (and specifically first time home buyers) is finding someone you can trust. I knew of all these players I needed to reach out to, but I didn’t know who to trust or at that point who to even contact first. So, here the process I went through to buy my first home and what I found along the way!
I first started the search for a realtor. Most people find their realtor (and other key players) from referrals - likely friends and family. Although you may get a realtor referral from your high school best friend - still find a few others and give them a call. This goes with all the other key players in this process as well. I got a realtor suggestion and poked around on the internet to find a few more. My biggest tip here is you have to vibe with your realtor. This is the person that is going to be guiding you on this monumental buying/selling process. You want this person to be honest, not pushy, and knowledgeable. Also, if you find as you are seeing houses it’s not working for you - politely move forward with someone else. You need to feel comfortable here.
Lender
Next, which was arguably the scariest for me, personally - finding someone for our mortgage. It wasn’t scary in the financial sense (yes, this is a huge purchase and that is inherently unnerving and exciting in-and-of itself), but it was scary because as a person who prides herself on being informed - I wasn’t sure where to begin - and I wasn’t sure what questions to ask.
Cue back to my coworker and another lunch meeting. We ran through mortgage options and key questions. Thank goodness for this woman.
Here’s a few key items to keep in mind when searching for your lender. You can get a mortgage from a few places - a bank, a credit union, or a mortgage brokerage. There are plus and minuses to all of these and that’s a more in-depth discussion. But generally, a few things you absolutely need to ask for off the bat:
1) What are their steps for a prequalification letter? Do they charge for a prequalification letter? How long is it valid for? When do they do a hard credit pull? What information do you need to provide?
2) What are their fees? Ask for a breakdown.
3) What is the current interest rate they are offering? Will they lock the rate in for you? For how long? Is there a lock fee?
4) Do they have a mortgage insurance policy? At what percentage down do they not require mortgage insurance? Can you get a discount on the mortgage insurance for a good credit score?
5) What documentation do they require for mortgage consideration? (example: bank statements, W2s, etc.)
The last thing I would add is ask them about their responsiveness (or send them multiple questions and test out their responsiveness for yourself). You want your lender to be responsive. Your lender can hold up your deal (or, if you don’t get approved, can kill your deal). You want your mortgage to be approved as quickly and efficiently as possible and in the time frame defined in your contract. You need your lender to come through - so test them early before you commit. Personally, my lender was wonderful. I’m not sure how many people actually say that about their lender. He was kind, patient, would answer my insane amount of questions at lightning speed, and got my prequalification letter to me on a Sunday in a matter of hours.
Attorney
So, I got my realtor and my lender. Next, I found my real estate attorney. Yes, I got a real estate attorney for my first house. And, I’m happy I did. My main tip here would be to engage an attorney early. I interviewed a few attorneys prior to even finding our house. I wanted to be ready right away. A few key things to ask (other than their experience and general way of doing things):
What is the length of their representation? Just attorney review? Through closing?
What is their fee? Is it a flat fee? When is it paid?
What is their turnaround time?
Are they open for questions and will walk you through any suggested changes to your documents?
You’ll want to note the attorney’s responsiveness as well - after all they’re the ones moving you closer to closing! Also, just like everyone else in this process, you should genuinely like them.
Inspector
Lastly, the inspector. This was probably the least pleasant part of our home buying experience. You can get inspector recommendations from anyone really, but they will most likely come from your real estate agent. Our real estate agent - who I love - gave us a list of three to review and reach out to. Why we went with the person we did - I’m honestly not sure, BUT we definitely learned from it. You’ll want to ask the inspector about fees, the report, and timeframe. But, you’ll also want to try and ask as many questions as possible to get an understanding of who you are working with because that’s the first of the two issues I had with our inspector. Our inspector would not address my questions - he would act like everything I asked about was silly. He would only truly respond to my husband or father (TIP - have as many people walk around with the inspector when he’s going through the house. The more eyes - the better). It got to the point where I stopped walking around with the inspector because I couldn’t take the attitude anymore. This bothered me immensely (and still does) and I wish I took a bit more time at the onset getting to know who I would be working with.
Secondly, don’t just rely on the inspector to look into things at the house (goes back to my tip, above). Be critical. Push back. What the inspector writes in the report can give the buyers leverage to negotiate seller’s concessions. If you think something is weird or wrong - bring it up. There were a few water related red flags at my house that for whatever reason we didn’t push on. About a month after we closed - LOTS of water in our detached garage and a good amount of water in the basement…………..
In the End…
Do yourself a favor and be choosy about your team. You can then brag about them anonymously on future blog posts (or give them a review online, which I’m sure they would appreciate!).
If you’re buying or selling a home in New Jersey, Pennsylvania, or New York, we’d love to be a part of your dream team.
You can contact us at 856-528-9195