Home buying advice?

[johnpalmer]

So, let's pretend that I've just started wanting to buy a house.

I've heard it said that first, I should try to get approval for a loan... make sure that if I find The Perfect House, costing exactly $X, that I have approval for a loan that is $(X-Downpayment), plus cash for down payment and for other fees.

But let's pretend I'm doing that. What's the next step? Search for people (like real estate agents) or search for homes? (And - one website I saw suggested that a real estate agent is essentially free - either I have an agent who splits the agency feel, or the seller's agent gets the whole fee, or, if there's no agent, it all goes to the seller. Is this correct?)

Let's say I find a place. Selling price is $X. Is there any way to finagle "The house needs $Y of work; at that point, (some expert - an assessor?) says it'll probably be worth $(X+Y). So, BankPeople, you give me $(X + Y) - Downpayment, and I get $Y worth of work done." Or, is that a bad idea to take to a bank?

I'm asking this because I saw one place that is on a huge chunk of land - I'd love to have that much space, but the house needs "TLC". Which can mean "new paint and carpets," and I'm cool with doing that, or getting it done. But it can also mean "See that paint? You can't strip it off; it's holding up the house. In fact, what you really need here is a new house to hold the shape of the paint before the paint gets old and starts to crack and the whole thing collapses."

Finally - is there a wise person's way of getting an idea of what might need to be done to a home? If I was buying used car, I'd take it to a trusted mechanic and ask them to assess it. Is there a service to do that for houses? I've heard it said that the bank does an assessment (to make sure they're not over-lending) but I doubt that assessor is interested in giving advice to the borrower.

Comments

[suzilem.livejournal.com]

When I bought my house, I had my own agent. She split the commission with the seller's agent (6%/2). I paid for my own inspector ($300). He noticed a few things, which were put into the offer. We asked for the seller to pay all closing costs, plus a new roof, and a new inside part of the air conditioning (I can never remember which part is the compressor and which the condenser), and a couple other minor things. In response, the seller asked to raise the asking price $2k. We closed at $107,900, I paid the 3% FHA minimum downpayment, and my PITI (principal, interest, taxes, insurance) was about $975 the first year (it's gone up some since then because of property taxes rising).

Getting a good agent is critical IMHO, especially if this is your first time buying.

Another thing I chose to do was to get on my lender's "Equity Enhancement" program. I am paid biweekly, and half a payment is deducted every paycheck. That means that the first 12 months, I paid the equivalent seven months or so of principal. If I keep doing this, my mortgage will be paid off about 7 years early.