House #2, accepted offer
At the risk of counting my chickens before they hatch, I just had an offer accepted on our second SFR yesterday. Our initial offer was presented in October so this was a long and at times exhausting process. I'll get more into that with some lessons learned as paperwork gets finalized in the coming weeks.
As far as work goes, this house is in very nice shape. Extremely well kept. The current owner is 70 and he was born in the house. He takes great pride in his property. There are two big projects. #1 is asbestos removal from heating pipes in the basement. That absolutely MUST be removed properly before anyone gets in there. #2 is converting the dining room into bedroom 4. This is fairly simple. We will be hanging a door where there used to be one. The dining room was a bedroom years ago, so relatively easy conversion. 4th bedroom is critical as we will be renting to college students and 4 bedrooms are the most popular in the area. We may convert the furnace to natural gas from oil. That's yet to be seen. We will see what else pops up in the inspection, but I couldn't find anything else this house needs. It's in excellent shape.
As for numbers, I don't want to go into too much detail yet (trying not to count those chickens) but the asking price was 210, They accepted 182. Expect to rent for 2600. More details in the coming weeks.
look into your utility provider giving grants for the asbestos removal. Im in MA and last year my utility provider paid $3000 to remove all asbestos from my basement.
Oh that's very interesting. Thanks @Rob Beland
I should change the title of this to "Don't count your chickens!". We had the inspection in the house this weekend. All went smoothly. The house is in excellent shape with no surprises. Sellers said the inspection for the house they are buying is set for Tuesday at which point we should be able to get contracts going and move the process along. I got a call yesterday afternoon from their realtor and the sellers lost their deal for the house they want to buy. Someone came in with a cash offer above their offer. she would still like us to sign a contract with no known closing date. I have no intention of doing that.
So this leaves us with a few options. Wait it out and see what they find (hopefully soon) or restart our search. Being that there is so little stock in our neighborhood, my gut tells me we will be waiting this out. In the meantime, the search for #2 continues.
Maybe the seller is interested in signing a rental agreement!?
You get to buy the home and have income, and the seller is not out on the street.
Agreed, that is exactly what we will be proposing. We suggested this earlier in our negotiations and they were not interested but this may be a more interesting option to them now.
A quick update. The sellers have found a new house that they want to buy and they put in an offer yesterday that was accepted. We should have a contract in a few days.
Now here's the wrinkle. I recently accepted a new job and I'm going to be taking two weeks off in between. The new job starts at the end of the month right as the bank will be attempting to approve us. On top of that I'm taking a pay cut at the new job. I'm worried about how all this will affect us. I I think we will be putting enough money down that they should still approve us but I have a funny feeling this won't go so smoothly.
Stay tuned.
Originally posted by @Carl C.:
A quick update. The sellers have found a new house that they want to buy and they put in an offer yesterday that was accepted. We should have a contract in a few days.
Now here's the wrinkle. I recently accepted a new job and I'm going to be taking two weeks off in between. The new job starts at the end of the month right as the bank will be attempting to approve us. On top of that I'm taking a pay cut at the new job. I'm worried about how all this will affect us. I I think we will be putting enough money down that they should still approve us but I have a funny feeling this won't go so smoothly.
Stay tuned.
Can you move up your closing, even if it means a rent-back? The financing will be a lot smoother if you are in your current job.
Thought I'd provide a quick update on this house. This is a deal where anything that could go wrong has gone wrong. We initially set closing for July 15th. Our bank sent over the mortgage application docs and literally every piece of paper had something incorrect on it. We sent everything back with corrections to be made and heard nothing from them for three weeks. When we were finally able to get a hold of them and asked what the hold up was they responded with "whats the rush? your closing is scheduled for Sept 3rd." So we have learned a lot about incompetent employees at this bank. They have been horrendous to work with.
The next issue was asbestos on pipes in the basement. The bank refused to provide a loan before the asbestos was removed. We had an agreement with the seller that we would take care of the asbestos after closing and they would reduce the selling price so we could deal with it. Now we had to renegotiate who would pay for it and when it could be completed. We scrambled to find a contractor and got it done within a week for less that I thought. But what a pain.
The next issue was the title search. The house has been in the same family for over 70 years. We thought there should be no issue. When the search came back, however the dates didn't make any sense. The search was ordered on June 22 but the records for the county were only current as of May 15th. So the bank said that wouldn't be acceptable because it needed to be current within 60 days of closing. A special call to the county by our lawyer got that straightened out, but once again it was a struggle.
Now in theory we have everything settled though the bank had verbally said we are clear to close, their checklist on their website still says things are under review. I'm a little worried about that. We had agreed with all parties that closing would now be Aug 7th. Yesterday our lawyer calls to say that the sellers lawyer wants to push it back to sometime next week because "there won't be enough time for two closings in one afternoon" and "having the closing in his office will disturb his secretary". What??
So we are theoretically closing sometime next week but i have no idea when and all this nonsense makes me wonder if we should be buying this house at all. There's been a problem at every step of the process so my fingers are crossed that this place isn't cursed. Stay tuned for next week. I'll let you all know how it goes.
Oh and in the meantime the house on the other side of us just went FSBO. Now I'm scrambling to figure out where I can get some more money.... I have a few ideas once I get this house done.
Nothing ever goes as planned. lol. but congratulations anyway!! Don't let a bad bank make you think the house is Jinxed.
My stepson and his wife bought a multi-family in the Bronx several years ago... and I was floored at the convoluted process they went thru to close on the house. The were advised to not use an Agent... but instead just get a lawyer... and the loan guy was forever messing up the docs. It took about 6 months to close and you can imagine the stress it caused them. It was a nightmare!
Is this an NYC property?
@Leann W. if we didn't have a lawyer in this process we would be going nowhere right now!
@Jayson Greenblatt this is upstate in Poughkeepsie.
Update: We finally closed on the house on Friday..... sort of. The closing ended up being described by everyone at the table as "the worst closing I have ever attended". It was exhausting. In the end it took 5 hours to get it done, there was a bank lawyer who was 3 hours late, incorrect docs from the bank, yelling by everyone, crying sellers, getting kicked out of the seller's attorney's office, an attorney who still used a type writer, a wonderful title rep who canceled her dinner plans and had us shift the closing to her dining room (sans sellers), final check exchange on Monday, and pizza. Oh and did I mention the sellers attorney isn't a real estate attorney?
If this was my first deal, I might never buy a house again. Holy moley. The house is now ours but the sellers are staying until the weekend to have time to move their stuff out. They close on their new house today so fingers crossed that it all goes well. As far as work goes, I have three doors I need to install then this house is ready to go. It needs nothing unlike our first place that needed everything.
We will be putting it up for rent immediately but since we rent to college kids I don't expect that we will have tenants for the upcoming semester. In the meantime my parents will be moving in while they renovate their house. With any luck we will get renters for the second semester. I'll keep you all posted how that goes.
You may still get those college students. My son is a junior and has a number of friends that are not set on where they will be living. Or are commuting from home, but dying to get out! Some transfer students ... Best of luck to you on this endeavor! [and, I agree with @Kevin Harrison - don't let a bad bank put thoughts of being jinxed in your head. Turn it around to: patience and persistence will win in the end!
@carlcarlson, I worked as a RE agent for about 2.5 years back in the early 90's here in NC. 90% of buyers use an agent to purchase a home (I'd say).... getting the lawyers involved usually only happens when it's time to schedule a closing. that's the process. I was so not used to the idea of engaging a lawyer as part of the negotiating process, etc. Is that normal in NY?