“You don’t get any money back from renting.” This is the kind of remark I heard regularly from homeowners over the years when tax season rolled around. When you rent, your landlord or property owner makes money back. You? You’re basically paying for storage and a place to cook and shower. If anything is in need of reasonable repairs, the maintenance person must take care of it instead of you. And I liked it that way. Although my grandfather was a master mechanic, a master chef, a gardener and a veteran who built his home from scratch, I did not get any of his handy skills. Going to Home Depot was a different kind of punishment for me, and boy, did he enjoy going to fix-it stores. Ugh.
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But what really made me reconsider the idea of homeownership after 17 years of renting was oddly enough a guy I formerly dated. He was an overseas basketball player, who was trying to figure out what to do now that basketball was (professionally) over. I respected that he bought property while he was still playing. And when he recently lost his job earlier this year, I knew he’d still have steady income coming in from the people who were renting his property. While he was reasonably concerned about mortgage payments, the housing crisis of 2008 alone proved how many homeowners didn’t even have renters to help them foot the bill. He invested smartly.
And if you ever want to get my attention, start talking to me about how to make a profit or tips for investing. I become the sideways-glancing puppy within milliseconds. (See Shep.)
Then, when a coworker/friend of mine also started looking into homeownership the same month, that was all the push I needed to pursue it. I’m happy to report that as of two weeks ago, I am now a homeowner. But the past three months have been quite the roller-coaster ride. Here’s what I wish homeowners would’ve told me before I started along this path — and hopefully will help you in your search for buying a home.
- Do not rely on the online quiz that mortgage companies will provide on homeownership. Depending on the mortgage company you work with, some will be OK with you just taking an online exam to get the basics of homeownership. Others will want you to take a mortgage certificate class. Take. The. Class. Regardless.
There is nothing more frustrating for a novice shopping around for a home than not being able to understand the lingo. If you don’t know what adjustable rate mortgage (ARM), fixed-rate mortgage, closing costs, escrow, private mortgage insurance (PMI), principal and interest (PI), title fees, earnest payment, homeowners association (HOA) and property taxes are right off the top of your head, you’re going to have a helluva time trying to understand your mortgage specialist. Although I financially qualified for a home, reading the emails regarding what to shop for were giving me a headache and it’s not the real estate agent’s job to teach you everything about owning a home.
I was already a subscriber of the City of Evanston newsletter. From a casual scroll, I saw the three-part workshop for the Housing Opportunity Development Corporation (HODC) First Time Home Buyer Education program and signed up. Christopher Meeks, who was the housing counselor for my summer certification course, was amazing to work with. And best of all, the information, the classes and the handouts are free. HODC’s next set of first-time homebuyer sessions will be on Sept. 8, Sept. 13 and Sept. 18. Email Christopher Meeks for further details.
2. Do not be wow’d by the first walkthrough of a home. Three times a charm for me. On my closing date, it took three hours to finally close after three weeks of waiting to be approved on my current home after I turned down three other condos. Buying a home is so much like dating. On the first date, this place is all kinds of cute and you cannot wait to get to know it better. Then the inspector comes in and shows you every single thing wrong with it. My first condo had 11 things wrong with it, and they were things I’d have never thought to check from my first stroll inside — stove burners that only worked if you turn them two at a time, shaky outlets, an old fusebox, a huge hole underneath the sink, several closet doors that were misaligned, etc. I should’ve known something was off when the owners suddenly wanted to sell it to me “as is,” when those were not the terms when I first saw the posting. And inspection and appraisal costs are nonrefundable from each home, so you better really look at your “date” a whole lot closer before putting down that first earnest payment.
3. Go on more than one walkthrough, even after the inspection. I learned this the hard way after living in an apartment for eight years and having two nightmare neighbor couples above me. Whatever time you did your first walkthrough, find another time to do a second one. Weekends and weekday evenings are the best times to really understand who your neighbors are. Do they loudly blast music or smoke so much weed through their vents that you’re now high too? Been there. Do they think it’s OK to run on a treadmill so every morning sounds like Barnum & Bailey Circus? Yep, dealt with that too, sir. Will you need a collection of candles and incense to get rid of the smell of their funky food? Yes, ma’am, I can relate again. I have had outstanding neighbors and others that I wish would move straight to the Bermuda Triangle. Make sure the neighbors and the neighborhood you’re moving into fits your preferred living conditions.
4. Always have a lawyer. Lawyers are not cheap. I get it. And maybe you think you are a whiz at reading contracts. (As a freelancer, I read them all the time.) But when the mortgage company, the title company, or the condo association all hand you enough paper to fill up an office copier, you’re going to need a little help. And that help should be someone who already understands how real estate works. I’d previously interviewed several lawyers during a freelancing project with CBS Chicago, and I chose one of them as my real estate attorney. You should try to find someone who you strongly believe will look out for your best interests as a homeowner. And they should definitely do more than just browse the closing documents; find someone who is willing to patiently answer questions along the way and professionally speak on your behalf if need be.
5. Make sure your real estate team has your best interests at heart. I talked to at least three real estate agents before deciding on one. The first few were more interested in the preapproval letters and less interested in showing me places that fit my needs. Then there were a list of nightmare homes sent via email from one of those agents that never matched anything I said I wanted. Just like real estate lawyers, real estate agents do not get paid until you close. But if you find one who actually listens to what you like as opposed to what he/she likes, this relationship will be so much better. And you must have a mortgage consultant (and team) who is patient enough to answer questions along the way and get along with your real estate agent.
I won’t go into full elaboration on this, but I had it out with one company’s mortgage consultant for repeatedly being rude to my real estate agent. Your real estate agent (or lawyer) may not be your BFF, but there’s a certain level of respect your entire team must show each other to be able to get the job done. If not for that mortgage company being willing to reassign me to someone else, I’d have canceled the entire deal. I didn’t have much contact with my reassigned mortgage consultant once paperwork was drawn up, but I certainly talked to the team behind him quite a bit. That crew of ladies were professional, responsive and far more patient with my lawyer, my real estate agent and myself.
After learning these five lessons (some the hard way), I couldn’t be happier. And as far as those visits to Home Depot, I’ve been in there almost everyday since because I keep fixing and changing everything. R.I.P. to my grandfather, who subconsciously set the groundwork to make me into a (surprising) handywoman. As far as the master mechanic and gardener, yeah, that’ll never happen. Well, unless this green thumb continues on.
This post was originally published on August 19, 2018 on Chicago Now’s “Message from Montie” blog.
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