7 Lessons from the Home Buying Process

I’m in the process of buying my second home. My first home from my previous marriage recently sold to an out-of-area real estate investor who is converting it to a rental property. Zillow informed me that my previous home is on the market for rent at $1,425. It seems a bit high for a small ranch house in that area. But, that’s just me.

My new home

Here are some things I’ve learned through this home buying process:

  1. Identify what type of property you want.
    • In the beginning, I wanted to buy a duplex to house hack. I’ve been interested in being a real estate investor for YEARS now. I’m talking since my 20s. I’m now 42. I’ve heard about house hacking for quite sometime from listening to the BiggerPockets podcast, reading real estate investing books (again, mostly by BiggerPockets) and attending real estate clubs in the Pittsburgh area.
    • The duplex I wanted was at the high end of my purchasing power. So, I switched gears to buy a single family property first. We could always buy rental property later after we’ve saved more money and/or built up equity in the house to refinance.
  2. Find your team. Don’t be afraid to change it if it’s not working for you!
    • Ask around for referrals for a realtor and lender. I found my realtor and first lender through my ex, believe it or not. (My ex and I are civil, especially for our sons’ sakes.) The realtor and lender came as a package deal as they worked together regularly.
    • That first lender denied me (and my ex who was also purchasing a second house after the sale of our first house). We both felt he treated us unfairly. My ex found a new realtor and lender. And, I too found a new lender; however I kept the same realtor. I’m closing on my house this coming Tuesday!
    • This brings me to my next point…
  3. Don’t give up!
    • If you come up against roadblocks in the home buying process, don’t give up on yourself too soon. Think about how you can get yourself to where you can be approved.
    • If you have poor credit, work on making it better. Use the Credit Karma app to monitor your credit. To get an accurate picture of your FICO score, go on Experian.com. Pay off or settle collections on your credit report, if you can. Use a reputable credit repair company, like Ovation Services (part of LendingTree), to help you with removing negative marks and disputing items on your credit report.
    • Once you’re ready to apply for a home loan, be sure to stop any credit repair activity by your credit repair company as lenders don’t want to see anyone messing with your credit during the home loan approval process.
  4. Be flexible!
    • The home buying process takes longer than you expect. Be prepared to give as many financial documents as possible for underwriting your home loan, including but not limited to:
      • bank statements
      • retirement statements
      • Any other accounts (Robinhood investing, credit union, etc.)
      • paperwork from the sale of your previous home or property
      • Any bankruptcies, foreclosures, etc
      • W2s from your job or other proof of income
  5. Plan ahead.
    • When you know what your closing date will be, order your rental truck ahead of time. Gather up packing boxes for your move. You can find free boxes on Facebook marketplace. Or, you can buy some for relatively cheap at Home Depot or Lowe’s.
    • Transfer your utilities into your name beginning on the closing date.
    • Change your mailing address with the post office. Be sure mail is forwarded from your old address to your new one.
  6. Think of furnishings.
    • Do you have the money to spend on new furniture if you need it? If not, check out Facebook marketplace and Craigslist for deals. Try to avoid financing consumer purchases like furniture. That is bad debt because furniture is a liability, not an asset.
  7. Invite your family and friends!
    • You’re in your new house. You’ve decorated and furnished it. Now, it’s time to celebrate your new home with friends and family. Throw that housewarming party you’ve been dreaming of since you laid eyes on that property.

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