Our new house!

It’s done; we own a house!  And it all came down to a last-minute 1.5-mile bike ride through suburban Minneapolis.

Oh yes – I’m serious.  It’s been nearly a month since my last post on home buying, but that’s because not much happened until yesterday.  In the three weeks until yesterday, all we’d been doing was randomly stopping in Home Depots and Lowe’s to check out carpet, laminate, paint colors and types, and so on; we picked a carpet and a brand of laminate.  We also found homeowner’s insurance, which is surprisingly difficult when you live anywhere vaguely close to coastal area.  We are technically 1500 feet from a bay that attaches to the Atlantic and about 8 miles from the beach, which apparently makes us a “hurricane risk.”  One insurer outright told us that they were unwilling to insure us.  But we eventually found one, and everything related to the loan and closing was taken care of on our end over a week ago.

After doing that, as there wasn’t much left for us to do, we just waited.  So by yesterday, we started to wonder if we were really going to close on this house on time.  The sellers were supposed to do repairs, which it didn’t look like they had done.  We also had never been given instructions on where to send our down payment, so no money had changed hands.

Then yesterday, our loan officer e-mails us our settlement statement – the final summary of our loan – with the April 30 closing date.  Surprise!  I also learned a little more detail on where closing costs go; the statement lists around 15 distinct parties receiving money as a result of this sale.  It was also a bit of a surprise to learn that our closing costs were $1000 greater than our good faith estimate had indicated they would be.

Of course, at this point, it was too late to send a check – we got the statement at 11PM the day before closing, so we obviously couldn’t mail a check that would arrive in time.  No problem – we’ll just do a wire transfer tomorrow.

I wake up this morning to find my wife telling me that I have to initiate the wire transfer as soon as possible, only minutes before she walks out the door to head to work.  She’d just received a call that the closing was scheduled 3 hours later, and wire transfers, according to the company handling our title, take up to 2 hours to go through.  Annoying, but no problem, I think.  I’ll just call the bank and initiate the transfer.   I sit on hold for 20 minutes and finally get a bank representative.  “I’d like to initiate a wire transfer,” I say.

To which the representative replies, “You can only initiate wire transfers at a branch office.”  The problem is that at this point, it’s 2.5 hours until closing, the transfer will take 2 hours, and my wife has the car at work, where she is actively lecturing for at least an hour.  My scooter is also non-functional; we are missing a bolt/nut combo that apparently allows the entire thing to turn on.  So what option did I have left?  That’s right – the bike.

Not having biked since last fall (it’s still cold in Minneapolis in April), I hunted down the bike pump in a closet, pulled the bike from where it was stored, filled the tires to 70PSI, and 2 hours and 10 minutes before closing, took off down suburban Minneapolis streets for the local branch office 1.5 miles away.  7 minutes later (averaging 13 mph over 18 blocks, including several stop lights and signs!), I arrive panting at the branch office.  I sit down with the manager, hand her my ID, give her the routing and account numbers for the title company, and initiate the transfer.  Crisis averted, and only a minute or two late.

After a much deserved break at D’Amico & Sons, I bike back more slowly and arrive home about an hour after I initiated the transfer.  And look – in my e-mail, a message from the loan officer that the wire transfer had been received 15 minutes ago and all was well.  Fantastic.  Nothing like an unnecessary sense of urgency to get the adrenaline moving.

And finally, after all of this, it was quiet.  No messages, no phone calls.  Nothing.  Two hours of silence after our closing supposedly occurred, I receive an e-mail with the subject “Congratulations are in order.”  Finally, we are homeowners.  And it is a process that I hope I never have to go through again!

I’m not sure what terrible thing will happen.  But I know it will be something.  Things can’t consistently go well.  I mean – I have a new job, a new house, reasonably good health, and my dissertation seems to be progressing on-time.  We’ve been having trouble getting insurance companies to get back to us about home insurance, but other than that, everything has been smooth-sailing.  So whatever’s going to go wrong, it must be big.

Plans for the house itself haven’t really changed.  We bought HGTV Home Design Software in order to better model what our renovations will ultimately look like, which has been slow-going.  It’s very complex software, but I think creating a 3D model of our new home that we can virtually walk around is worth the learning effort.  Plus, then my wife can redecorate at will without making me lift any furniture!

Some advice though – if you are buying a house from afar and planning to make a 3D model of it, make sure your room measurements are accurate before you leave!

Our New Home!

Day 7 was quite a bit more successful, although still a little stressful.

This morning, we heard from our agent that the bank had not updated their conditional approval letter (previously called a “pre-approval letter”) to reflect our new asking price ($5k under asking rather than $12k under asking), so the seller’s agent never even forwarded it to the sellers.  A quick call to our mortgage company later, and the letter was off.  Only a few hours later, we received word back that the sellers had verbally agreed to our offer with a minor change – we had asked for the entire house to be re-painted with white primer, but they only wanted to put primer on non-white walls.  Minor distinction (and not really important to us), but a distinction that had to be made in writing.

You might note that I used the words “verbally agreed.”  This is because the sellers don’t live in VA Beach anymore – they moved to North Carolina some time ago.  So the seller’s agent (based here) had to drive 4 hours to North Carolina in order to get them to sign the papers – which they did!  We very quickly drove to our agent’s office to sign the papers indicating we agreed to the slight change in wording, followed by a trip to Haynes (a local home furnishing store) to look at carpet and hardwood floors.

So as of March 19, we are homeowners.  At least, given several contingencies.  One, our financing has to come through (of course).  Two, the house must be appriased for more than we paid for it.  Three, the sellers must repair anything troubling discovered in the home inspection.  We managed to find an inspector willing to schedule a next-day inspection, so around 4PM tomorrow, we’ll be heading to the house with our agent to listen to the inspector tell us about our new house for a few hours.  Fun times!

Our agent seems honestly surprised that this all worked out.  We went from looking at our first house to having an accepted offer in one week!  Not bad, eh?

We tried to prepare to for this horrible, horrible process by reading a lot of books on the subject and perusing a lot of webpages where people told horror stories about their experiences.  And by we, of course I mean my wife.  To save time, I have been hoping to learn about real estate by osmosis from her, and for the most part, it seems to be working.

As part of our plan to transition to a full-fledged academic life, we wanted to purchase a home in South Hampton Roads at the south end of Chesapeake Bay before we actually moved.  This, at the time we decided it, seemed like a “good idea.”  Today, we finished Day 6 of an adventure that started on my birthday, and it has been a very stressful and thus far not-so-rewarding experience.

Days 1 to 4 went fine.  On Day 1, we flew in relatively uneventfully.  On Days 2-4, we looked at about 30 houses in Norfolk (the location of ODU), Chesapeake (south of Norfolk) and Virginia Beach (east of Norfolk).  Each has its own particular traits that tend to be similar across neighborhoods.

Norfolk is very much a city, and any house that we looked at there simply felt very urban: small lot sizes (and small backyards), less square footage for the price compared to the other cities, and generally more run down neighborhoods, at least in the areas that we could comfortably afford.  Ghent, for example, was ridiculously nice, but far out of our price range.  So it didn’t take much looking to realize that for the quality of life we wanted, Norfolk wasn’t really an option.

Chesapeake and the areas of Virginia Beach within 30 minutes of ODU, on the other hand, are more suburban areas, comparable to South Minneapolis or West Nashville (the only two cities that I can really compare against!).  So houses in both ended up near the top of our list.  We ended up settling on three properties in our price range: one near Town Center in Virginia Beach that needed a little work (about 30 mins from ODU), one near KempsRiver Crossing also in Virginia Beach that needed a lot of work (also 30 mins from ODU), and one in Chesapeake in the Indian River neighborhood (about 20 mins from ODU) in beautiful condition.

The KempsRiver house was my wife’s original favorite.  I think it was because of the white counters with lime green trim in the kitchen and shag carpeting.  I’m not against fixer-uppers, but only those that I wouldn’t feel dirty living in while the work was being done.  The house in Indian River was my original favorite, as it was more conveniently located to ODU and “turn-key” – spacious, clean, roomy, and every single square inch of space under the roof converted into livable square footage.  Of course, that’s just the reason my wife didn’t like it – no room to build equity beyond ordinary appreciation over time (which we’re not terribly confident in, given the economy).  So ultimately, we settled on the Town Center home – it also needs quite a bit of work, including new paint and flooring for the entire house.

So given that, we decided to put an offer on that house, which happened on Day 5.  We made final visits to our final choices with our agent, Ronnie Hooks (who has been fantastic), and drafted the contract for $12k under the asking price with all closing costs paid, new paint, and new carpets (bad economy for sellers, good economy for buyers!).  If all worked out, we’d live within 15 minutes of the picture below.

In the morning of Day 6, we received notice that our offer had been rejected.  No counter-offer – outright rejected.  Our closing date was apparently a problem – we didn’t want to close until June 1, because that’s the earliest that the banks we’ve been working with would close (my appointment at ODU starts July 26).  A one- to two-month closing is apparently fairly typical in most places (like New Jersey, from which my wife was getting most of her information).  In this area, three weeks is typical.  You can see the problem.

So today has been spent in a multi-step process, much of which we didn’t have any control over.  We immediately contacted the banks to see if they could give us a better closing date, but neither of the loan officers that we’ve been in contact with was available.  We then contacted our agent to set up a new appointment at the Indian River house, as that was second-place in our housing scheme.  On the drive to the agent’s office, we received a call from one of the banks that they might be able to move the closing date, but that they needed to see the wording of my contract.

Apparently, most jobs only give you a “letter of intent to hire” when they agree to hire you, which means that they are only obligated to hire you if everything goes well.  Academia does not work this way.  I interviewed for this position four months ago, signed the contract two months ago, and the position does not start for another six months.  It’s a long process.  It also means that I sign a contract that is legally binding for both parties – I have to work there, and they have to hire me.  Apparently, the bank didn’t understand this.

So, I gave the bank the phone number of the ODU Academic Affairs office so that they could get a copy of my contract to see what it actually said.  Five minutes later, the bank called me back to say that ODU wouldn’t release my contract without my permission.  Five minutes later, I called Academic Affairs to give my permission.

At this time, we arrived at Ronnie’s office and set out to see the house at Indian River.  We then looked at it for the third time, to verify what we basically already knew – the house would be impossible to expand dramatically (to build equity).  What we did figure out was that two walls could be fairly easily knocked out to increase the size of the kitchen, which was my wife’s major concern.  So the Indian River house became a contender in our hunt.  If we couldn’t get the bank to agree to an earlier closing date, the owners at Indian River were willing to entertain a June closing date – they had small children, and pulling them out of school wasn’t preferable anyway.

By the time we were done seeing the house, it was time to drive to a reception being held for a senior faculty candidate at ODU.  I mean – I’m in Norfolk anyway, so I might as well start to participate in departmental affairs, right?  So we head over to the reception and have to stop on the side of the road because I’ve received a call – one of the banks that we contacted has received the fax of the contract from ODU, and we are clear to put in a closing date as early as we want.  Our closing date thus shifts to April 30 – this is still 5 weeks out, but classes end in early May, so this is as close as we want to cut it.  We call Ronnie, and she starts drawing up new offer documents.  We spend a couple of hours at the reception and then drive back to Ronnie’s office to sign the papers so that she can fax them over.

And now you’re up to speed.  I have to say that this is one of the worst life experiences that I’ve ever had and can’t imagine ever wanting to do it ever again.  The degree of stress and uncertainty throughout the entire process is just mind-boggling, and we always have ten things to do at any given moment.  I’d planned to do some dissertation coding while I was here too!  That doesn’t seem like it’s going to happen, at least to the degree that I’d hoped.

Anyway, this is, as the title implies, Part 1.  Part 2 will be more uplifting, right?   Here’s hoping…