EDIT: Read update here!
If you want to read about my journey with condo shopping, here are my previous posts:
On to Getting Pre-Approved
We Thought We Were Going to Build
The First Condo We Offered On
The Townhouse Fixer Upper
Disagreeing Over Condo Shopping
Investment Property Shopping
First off, the BF and I are extremely happy and excited to be buying our first property. It's like a symbol of the beginning of our lives even though we are not married and have been living together for a few years already. We offered list price plus we offered to pay our closing costs - $159,900 plus about $5,000 closing costs. The seller is an investor so he wanted to close right away. Our lender has a bet with the seller's agent to close his next 10 deals within 15 days. Let's see if it happens!
We had a few issues with selecting a lender and even after we selected a lender, there was a TON of miscommunication which was frustrating to say the least. Here's what happened, in order:
- My mom referred us to her lender, and she quoted us 3.8% for 25% down.
- Seller's agent told us if we went with one of their preferred lenders, we would get the appraisal fee waived.
- Realtor told us to go with a preferred lender so they would more likely accept our offer.
- We emailed all 5 of the preferred lenders to get rates but all the rates were higher than my mom's preferred.
- We sent our financial docs to my mom's lender and decided to go with her.
- My mom's lender told us she had to double check rates because of the LTV 75%.
- She got back to us and her rate was higher than the preferred lenders.
- One of the preferred lenders quoted our agent 4.25% with 20% down which was the lowest rate so we decided to send him our financial info.
- We spoke to the lender we finally chose over the phone and he was giving us estimates of our monthly payments.
- We liked what we heard so we told him to go for it and call the seller to give our pre-approval.
- Seller signed our counter-offer and then lender sent us disclosures to sign.
- The disclosures said 4.5% but we thought it would be 4.25% so we talked to lender again.
- He apparently forwarded this rate to our realtor who NEVER forwarded it to us!
- He told us he couldn't do 4.25% at 20% down 0 points so we checked with the other preferred lenders again.
- I got frustrated and decided to just go with the 4.5% 20% down 0 points but BF decided to negotiate with him.
- Lender told us he'd give us $500 credit towards closing costs and we thought this was in addition to the appraisal fee, but the appraisal fee was still on the disclosures.
- We argued with lender about how we should be getting $450 credit for the appraisal fee AND the $500 closing costs credit he promised us. He said he'd talk to his manager.
- After more arguing and phone calls, they decided to meet us halfway for a total of $750 credit towards closing costs and we will be paying about $36,000 out of pocket with 20% down for a 4.5% 30 year fixed loan, 0 points.
Am I satisfied with the process and the outcome? It wasn't what I had hoped for, but considering all of the factors - the high LTV at 75%, the fact that the investor did a flip, and the fact that it's a condo - this was the best rate we could find and I am happy with it and the credits we received. I wish we could have had more credit towards our closing costs but that's okay. We are going to have it inspected this weekend and wait to hear back from our lender. He told us to sit back and relax, and he'll do the rest.
Honestly it is super important to have a great realtor and lender. Our realtor is a family friend (BF's mom's best friend) so she did not charge us at all and she put up with a lot of our questions, concerns, viewings, etc. I think she showed us over 15 properties in the last few months all over the County. We'll have to get her a generous gift for all of her help. Our lender ended up being very patient and one of the nicest guys ever. You have to be careful because they are ultimately sales people, but the fact that he kept on reassuring us and talking things out with us made everything go smoothly. He was recently a first-time homebuyer himself so he knew our concerns and he knew how to approach every question we had.
I'll be updating more about the process but since everything just happened - here it all is! If you have questions let me know :)
Oh and btw, I finally will here back from my #1 law school soon. I checked my status checker and a decision was rendered! At least I know I am not waitlisted, but I guess I could be rejected too. Crossing my fingers for some good luck vibes... will update you guys as soon as I hear back! Also I have been super busy with work and also the condo buying process so I should be back on track with commenting and reading blogs next week. I also have some interesting posts coming up that I hope you will enjoy. Hope everyone is doing well!