Finance: We bought a house. Never doing that again.

First off, thank you God for our home. I am so happy to get out of the rental hell in Chicago. I mean, I suppose when you don’t have toddlers and you’re living your best life in the south loop it’s all so great. That was not our situation. 

In Chicago, all the little affluent areas weren’t paying their fair share in property taxes. Well, when the new property tax assessments came out, some landlords, like mine, decided to pass on the cost to tenants.

Our rent went up by a few hundred. We were living in the West Rogers Park neighborhood, which is already pricey (but we loved it), we just didn’t want to pay what they were asking. This is what triggered the decision to buy a house, right away. THAT IS A BAD PLAN! 

So here are the reasons we should not have tried to buy yet: 

1. My husband and I weren’t on the same page. We’d already be stressed to the max with all of our issues, so trying to make such a major purchase without ever having a more specific conversation about what we would want is BANANAS. We still owe our sweet realtor Nick, over at SCOUT Real Estate Partners a gift for possibly saving our marriage. 
2. We had no money. That is right. LOL, We had no money for a home. We’d recently made some significant investments and hadn’t yet recovered financially. But we figured we could scratch up a down payment right? HAHAHAHA. 
3. We just barely had good credit. Yep. My husband had good credit and mine needed work. Mostly medical debt from my stretch of unemployment during the recession. 
4. We didn’t have enough time. Our landlords had only told us maybe two months before our lease would be expiring that the rent would be increasing and then they only gave us a week to agree to a renewal or to notify the that we would be moving out. 
5. Violent debt. I mentioned in my finance intro post that I have a substantial tax debt. When we started the house buying process my debt was newly controlled and for FHA loans you need to have three months of consistent payments under your belt. I did not.

So yep. The odds were pretty stacked against us. However, we still got pre-approved, approved and then closed on our home with a nice budget, especially considering the aforementioned issues.

This is the story of B & Patrick’s home buying experience. In summary, don’t be like B & Patrick. PLAN!!!!

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Here are some things I’ve learned that I hope helps you: 

1. PLEASE PLAN! Decide a year before that you want to buy so that you can speak with a mortgage professional and get a plan for addressing any issues associated with your lend-ability sorted out before you begin the buying process. This will give you a ton of runway. 
2. Some debt just shouldn’t be paid. Not all debt is equal and paying it may not make a difference in your score. A professional can simulate changes and tell you exactly how to move on your debt to get a mortgage.
3. Keep up with tax documents. You need to have three years of tax documents on hand. Now, every institution is different but three years is what you need to be safe. 
4. If you are self-employed you need to have: P&L and a Balance Sheet from year to date. 
5. If you pay yourself from the business account make sure the withdrawals and deposits match. You also need to make sure that you are showing consistent deposits. So if you pay yourself weekly, there should be a record of that. 
6. Don’t change banks. They only ask for three months’ worth of bank statements, so be sure not to cut it too close. 
7. You need to check stubs from the last 3 months. You may have to keep submitting new ones over time as you are working on closing on the house. 
8. There are so many down payment assistance plans, so take advantage of them. All of them have different requirements so you want to check to see which ones you qualify for. The main thing to know is that not all lenders are certified for these programs. You need a minimum score of 620 to qualify. They will take the middle scores from the borrower(s). Some will even flat out lie and say that they aren’t funded etc.. to get you to stay with them even though they can’t process a down payment assistance loan. DO YOUR RESEARCH. As much as I don’t want to give them the nod, Wintrust Bank is certified in many of these programs and honestly gave me the best overall package for my mortgage. 
9. Drive the process. OMG! I just sat back and thought that people in financing would just do their job. NOPE, NOPE NOPE. My awesome realtor told me that when you have a hard inquiry with one financial institution there is a window of time where you should get as many offers from others as possible. It’s expected that you shop around for the best offer possible. Customer service is just as important. I only had one moderately good experience with the financial institutions I interacted with and I am still shocked. 
10. Be aware that the person you initially speak to at the financial institution is a salesperson. Underwriting is the real big boss at the end of the game, so POWER through. The salesperson wants the loan to go through for either performance or commission purposes. Allow them to help you, but know that they should be managed.
11. Don’t listen to the property brothers. LOL So, I was so shocked that we would need to pay the closing cost because Johnathan and Drew told me that the sellers would pay it. Well, in Illinois a seller can only give you so much credit and it’s not gonna cover closing cost. Factor in that cost in addition to your down payment so that you aren’t sticker electrocuted like me. Yeah, it was beyond a shock.
12. SAVE! Look, I suggest having cash on deck. LOL I mean sure when I say we had no money, it wasn’t empty, but we didn’t have enough to shop without stressing over these numbers. Do yourself a favor, save to save your peace of mind. 
13. Get a realtor & Lawyer you can trust. I did with Nick at Scout Rep and Joseph M. Dvorak IV, attorney at law. It made a world of difference, in a challenging process. Your team is there for you! (I’m not paid for any endorsements mentioned in this post.)
14. Buy the WHOLE inspection package. We had the general home inspection, radon gas, and sewer line. Let me tell you. Nothing is worse than having a problem with any of the aforementioned areas and only finding out after you bought the home. We love having the peace of mind that our home is GUCCI, after such a stressful buying process.   
15. You don’t have to spend it all. Just because you are approved for a certain amount, doesn’t mean you should spend it all. The more you spend the more your closing costs and down payment will be. You should also be trying to get the best home for the money.
16. Closing is stressful AF! Well, at least for us it was. Our whack mortgage broker just couldn’t seem to communicate when we could expect to close. Despite his incompetence, you haven’t closed until you do. Even after you get clear to close from underwriting any little missed thing can cause problems. Have a bit of wine, weed or prayer or maybe all three before sitting at the closing table. It’ll be good for your blood pressure. I didn’t do any of the three so I was a nervous WRECK! 

Trinette Lindsay makes it seem like buying a home is fun. Maybe it is. 

Hey, just because it was a traumatic experience for me shouldn’t deter you, sis. I mean, we did end up in a dream home that we can grow and raise a family in for years to come.  

I’d be happy to be a sister of support if you need it. This process is so challenging and is a life-changing experience.