First time home purchase

[PhilpotHunter]

Guys, wish me luck. Me and my wife have found a house we like and will be making an offer on it tomorrow! Its a "for sale by owner", so any advice, or if anyone has a sales contract for the state of Kentucky it would be helpful.

[Feedman]

Get a home inspection!!!

[AteUp]

Get a home inspection!!!


What he said. Try to be there with the inspector. The guy who inspected my home said he always tells everyone 2 things about inspecting homes; 1) There is no such thing as a perfect house 2) Concrete is gonna crack. Good luck, I bet you're paying cash for it!!:eek:;)

[beards-n-bones]

My wife and I have sold and bought a homes "by owner". Its not as bad as some say (in my experiences anyway). Your financing company will do an appraisal, inspection and all of that good stuff. But get someone you trust to go over the home. Most people do not provide home disclosures when seeling themselves. Its just more of a hands on experience than with a realtor.

Make sure you get a notary or lawer to sign off on the contract to make sure the sellers dont try to pull anything on you.

Congatulations a good luck!!!

[predator]

Good luck, like the previous guys said, make the offer subject to a home inspection and contingent upon financing with terms agreeable to you.
You can get a sample sales contract from the Ky Real Estate Commission, but I would advise you to spend the money and hire a lawyer to do your contract. On a purchase this size, might be the best money you'll ever spend.
BTW, I've was a licensed Ky Real Estate Broker for over 20 years, now retired from brokerage, but still trading.

[gicts]

A good home inspector is KEY. My dad and brothers have a part time real estate gig. Down to owning and renting out 1 house now but let me tell you about 2 home inspectors.

Few years ago they went to a family friend who's in the realtor business. The friend sold them a house and recommended a 'good' inspector. Many legal problems were 'overlooked' including very obvious, costly, and dangerous hazards. Weren't noticed by us until they were a problem a few months down the road. (leaks, low power lines to the garage, lot of things not to code)Actually took the inspector to small claims court and won.

We were aiming on moving last spring. Set everything up with the bank, whole 9 yards...pending an inspection. Dad researched and got a good inspector. Most aren't cheap, but you get your money's worth. Covered every inch of the house with my dad as his side. Explaining everything as they went. Found out the roof had not been properly installed and leaked. Didn't get the house, and if we had we would have been in a heap of trouble.

I watched them inspect the house. He's from louisville and I certainly recommend him and can get his name if you'd like. My dad swears it's the best $200 he'd ever spent.

[hwright]

Never offer what they are asking. When they ask for more remind them they are not paying a realitor. Good luck. Its how I bought my first house and I had no problems... HEATH

[Xi Bowhunter]

Guys, wish me luck. Me and my wife have found a house we like and will be making an offer on it tomorrow! Its a "for sale by owner", so any advice, or if anyone has a sales contract for the state of Kentucky it would be helpful.\
Good luck Philpot! Are you staying in the daviess county/philpot area?

[daking]

HOME INSPECTION!!!!!!

I did about seven thousand home inspections over 23 years and I can't begin to tell you the surprises (good and bad) that came up at an inspection. Someone advised you to go with the inspector. Great advice! If you get nothing more out of being there than where to turn off the power and water and where to change the furnace filters, you'll be way ahead. Those things are critical when you need them.

Your banker will require a survey, a title search and title insurance. If there is any possibility that you'll absolutely, positively need to know your boundaries (fence, garage, etc) order a staked survey instead of a mortgage survey. It costs more, but if you need it later, you'll just be paying twice.

Title insurance. There are two kinds. One protects your lender (a lender's title policy) against defects in the title to your property. It is only for the amount of the mortgage and decreases as does the mortgage. An owner's policy protects you for the purchase price of the home and never decreases. It's a one time premium and the owner's title policy costs more, but if in 10 or 15 years there is a title problem (that you usually discover when your property is for sale or an adjoining property is for sale) you'll be glad you have it. Both that and the stake survey are cheap at the price. The inspection is ESSENTIAL.

The biggest thing to remember is that you are about to achieve the American Dream. The bankers and the lawyers can suck all of the fun out of it. Make sure it's fun and rewarding. You are getting what you want. In the throes of paperwork and spending, remember that you are doing something swell.

ENJOY!

[Art]

I don't know much about the FSBO deals, but I did sell a few hoses at one point.

A home inspection is a given, but you'd be surprised how many inspectors there are out there that are not that great and just how often they miss the obvious things. Make sure you find one that is experienced and has a good rep. The guy I used would spend 4+ hours at a 1700 sq. foot home.

I don't know if you are able to get one on a FSBO, but I would make sure that you try to get some type of legally binding sellers disclosure form. That would be my biggest concern.

[Crockett]

Knowing what I know now I would also pay to have a plumber come in and run a camera down the septic lines. I had a home inspection done on the home I purchased last year that was FSBO and the inspector pointed out a few problems but none were anything that I couldn't handle. However, 6 months after living in the home we found out that our sewer line was collapsing. If we would have spent $200 additional dollars and had the septic line inspected (they have these really sweet cameras that go down the drain on the end of a pipe snake) we probably could have knocked an additional 5 grand off of the sale price.

[trust me]

By all means, get the home inspection. If the home inspection reveals faults, and flaws, look them over carefully, and decide what you can fix yourself and what you want to avoid. Minor things that are easily fixable down the road are a good way to get the price down and get you into a home. Major things may warrant passing it up.

As said, no house is perfect. Concrete cracks, paint peels, floors creak. Just make sure you aren't buying a Love Canal or a Money Pit type of house.

[Chief Huntum]

Is the house heated with fuel oil. If it is, and the tank is aboveground, make sure its in good condition. Remember they can look good from the outside, but over time, the caustics in the fuel oil sludge rots the tanks from the inside. Also inspect the legs. If they are corroded, your asking for trouble. I can't begin to tell you how many residential fuel oil spills I have remediated due to rotting tanks and corroded legs.

If the tank is buried, you are taking a big chance. I would have it removed and replaced with an aboveground tank so you can inspect it. At a minimum have it pressure tested, but even this test can't detect very slow leaks.

Are you on well water? If so and you have a buried tank, make sure in addition to the standard bacteria test, have the water tested for volatile organic compounds. The test costs around $100.00.

Remember, many home inspectors don't even mention tanks in their reports so make sure you do your homework. Last thing you need is a fuel oil release or buy a tank that's on its way out.

Lastly, make sure your homeowners policy covers accidental fuel oil spills because it costs big bucks to clean them up.

[MsgMills]

Potty,

Ive bought homes and sold homes as an Owner...If your using your VA Certificate to buy the home don't worry the house will be inspected by a VA rep. The Sale will be completed by Attorney's representing you on the purchase and by the Bank representing you as well.
If this is a purchase and your financing it thru a bank, most will have it inspected and appraised before the paperwork can go forward for teh purchase.

Talk to the Financial Organization your using and ask them....

Good Luck on the purchase:)

[PhilpotHunter]

Thanks for all the advice guys!

XI, I'm actually looking at a property closer to you, out past Whitesville

[raktrakr]

Give the county PVA office a call and ask for the value of the home,they'll want the address. I think they call this the "assessed property value". This figure wont be exact but I think it will be pretty close. This will give you some idea where to start for an offer

[boola]

See if they will purchase a one year warrenty for the house ,it only costs about $200

[daking]

A VA/FHA inspection is for the benefit of the lender...only. It is not as thorough as a home inspection, it's made at the time of appraisal when you're not there and you have no recourse against the inspector.

The closing attorney is representing the BANK'S interests. Make sure that yours and the bank's are the same or get your own guy. Usually not necessary, but sometimes.

Good luck

[PhilpotHunter]

Well, the sellers of this property haven't been watching the news and don't realize it is a buyers market. They weren't willing to negotiate the price, so we have moved on. I will keep everyone updated as we continue. Thanks for all the great advice!

[trust me]

Not everybody has to sell. They may be able to sit on it until they get their price.

I had a neighbor that overpriced his house by 30 grand. He didn't have to sell, and was willing to wait. His first "for sale" sign rotted down after 2 years, so he had to place another. Finally, 3 years later, a sucker (medical doctor) from New Jersey came along and gave him his price, thought they got a bargain. He retired and moved away and was a happy camper. The buyers sold after a couple years and had to eat the 30K premium they unwittingly had paid.

A sucker is born every minute. Wait long enough, and one will come along. Don't be that sucker.

[PhilpotHunter]

Don't be that sucker.

Exactly. I'm no expert, but I know there are enough people out there that REALLY need to sell right now. I'll go find one of them:D

[predator]

Exactly. I'm no expert, but I know there are enough people out there that REALLY need to sell right now. I'll go find one of them:D

It is a buyer's market right now. PH you did good in walking away, when emotions come into play in a real estate transaction, someone generally gets the short end of the stick. Look at how wild some auctions get when people get to bidding against one another.

BTW-is the BLACK CAT is open down your way?? I've not been by there in a few years.

[quackrstackr]

My neighborhood is rife with people looking for a sucker. The housing market is still expanding here and the town is still growing.

Somehow we keep managing to get national attention in these "Top XX places to retire" polls and people are moving in from everywhere.

There was a house behind me that went for a full 1/3 more than it's already overinflated asking price 2 years after I looked at it ($300k up from $200.. which was insane). Someone from Detroit moved down and thought they were getting a heck of a deal on it.

Right now the people across the street from me with barely more square footage are asking almost 2 1/2 times what I paid for my house just 5 years ago.

[hwright]

My neighborhood is rife with people looking for a sucker. The housing market is still expanding here and the town is still growing.

Somehow we keep managing to get national attention in these "Top XX places to retire" polls and people are moving in from everywhere.

There was a house behind me that went for a full 1/3 more than it's already overinflated asking price 2 years after I looked at it ($300k up from $200.. which was insane). Someone from Detroit moved down and thought they were getting a heck of a deal on it.

Right now the people across the street from me with barely more square footage are asking almost 2 1/2 times what I paid for my house just 5 years ago.

I have a for sale sign you can borrow/ lease for 1 % of the sale price...

I think if I were you I would cash in...:cool: HEATH

[Hoosier5]

Guys, wish me luck. Me and my wife have found a house we like and will be making an offer on it tomorrow! Its a "for sale by owner", so any advice, or if anyone has a sales contract for the state of Kentucky it would be helpful.

Get EVERYTHING in writting and have it nortarized.

[predator]

My neighborhood is rife with people looking for a sucker. The housing market is still expanding here and the town is still growing.

Somehow we keep managing to get national attention in these "Top XX places to retire" polls and people are moving in from everywhere.

There was a house behind me that went for a full 1/3 more than it's already overinflated asking price 2 years after I looked at it ($300k up from $200.. which was insane). Someone from Detroit moved down and thought they were getting a heck of a deal on it.

Right now the people across the street from me with barely more square footage are asking almost 2 1/2 times what I paid for my house just 5 years ago.

I have a for sale sign you can borrow/ lease for 1 % of the sale price...

I think if I were you I would cash in...:cool: HEATH

Not so fast, remember you will have to still have a place to live and replacing your current house may eat up any profit.

QS, your situation is similar to mine, if you are in an area that is considered a good place to retire, "katy bar the door" on where prices will go. I'm optimistic
that this current pressure on the real estate values around water in Kentucky will continue for the next 15-20 years, barring any major nationwide recession. There will be some slow times, but for the most part DON'T PRICE IT IF YOU ARE NOT READY TO MOVE. Till the bulk of baby-boomers retire, I think the retirement market is the place to be to make money in real estate.
JMO

The people up North think we are giving real estate away! Compared to what they are used to, maybe we are.

[Ky mustang]

Quackr if that house sells for that price you better get ready for a property tax hike. A lady that I work with got an $1,100 increase in one year on her taxes, because somebody moved into the neighborhood and gave 350 k for a 1500 sq ft house.

[MsgMills]

Potty,

Go to Office Depot and pick up a Home Buying Contract Package. It has all the legal paperwork in it for you to use when buying or selling a home. I bought the packet when I sold my last home. Beleive me it has more info in it than I believe they actually use at most closings on homes.

It has the Discloser Statement in it as well...A main item to get the seller to fill out....

The packet cost like $29.00....Good Luck:)

[quackrstackr]

Not so fast, remember you will have to still have a place to live and replacing your current house may eat up any profit.

QS, your situation is similar to mine, if you are in an area that is considered a good place to retire, "katy bar the door" on where prices will go. I'm optimistic
that this current pressure on the real estate values around water in Kentucky will continue for the next 15-20 years, barring any major nationwide recession. There will be some slow times, but for the most part DON'T PRICE IT IF YOU ARE NOT READY TO MOVE. Till the bulk of baby-boomers retire, I think the retirement market is the place to be to make money in real estate.
JMO

The people up North think we are giving real estate away! Compared to what they are used to, maybe we are.


You are dead on. There's no way I could replace what I have right now for what I gave for it barring building myself farther out in the county in a less desirable area. You have a hard time finding land in a desireable area around here unless you want to buy a whole bunch of it and pay through the nose. Even then, desireable property rarely hits the open market.

The people that we bought the house from were completely caught with their pants down. They popped out 3 kids in the first 5 years in their new house and casually started looking around just seeing what was out there. The real estate agent they were tire kicking through talked them into listing their house by telling them it would take a while to sell. WRONG. It hit the market Friday and I wound up placing it under contract on Saturday. 2 other people put in offers the same day that I did. I had been looking for a year and knew what was out there and where it was headed. Those people had nowhere to go with 3 kids and no plan.

Mustang, so far the property that sold behind me didn't make as much of a tax impact as I expected it to. If the folks across the street get what they're asking for theirs though.....:eek:

[JDMiller]

Quackr if that house sells for that price you better get ready for a property tax hike. A lady that I work with got an $1,100 increase in one year on her taxes, because somebody moved into the neighborhood and gave 350 k for a 1500 sq ft house.


I've been expecting that for awhile around Murray. The city keeps on annexing property and anyone that has a few acres are selling to developers. The subdivisions going up are selling lots for $30,000 each and if they construct a home to sell....its in the $300,000 range. Our property taxes are already high enough as compared to some surrounding counties.

[WBBP]

Philpot, You have the advantage right now since most real estate markets have slowed down. To take full advantage of your situation, you need to look at as many houses as possible in your price/location range to find the most desperate seller that is suffering the greatest pain.

I would start with the houses that have been on the market the longest, are not currently occupied, and are at the top end/just above your price range-they should be a desperate seller.

Don't under estimate how much the seller is willing to bargain and come off his asking price. The national average is about a 5% reduction in asking price, but right now you could get 4 times that.

Don't be afraid to low ball someone with a ridiculous offer, because they might respond with significantly lower counter-offer way below the asking price. I call this bracketing the seller which is similiar to calling in artillery until you can fire for effect. You really never know the psychology of the seller or how desperate they are to sell. If you are smart, you can make someone elses pain be your gain.

I looked at a farm several years ago and the asking price was $79,000 for 100 acres. I respectfully offered $35,000 to the seller and said the farm was too rocky and the access was poor. The seller used a profanity toward me, but 2 months later after his wife/kids had moved to Georgetown to take a new job, he called me back and asked If I would be willing to give him $50,000. I countered with $44,500 and bought the farm.

Good luck.

K

[predator]

Philpot, You have the advantage right now since most real estate markets have slowed down. To take full advantage of your situation, you need to look at as many houses as possible in your price/location range to find the most desperate seller that is suffering the greatest pain.

I would start with the houses that have been on the market the longest, are not currently occupied, and are at the top end/just above your price range-they should be a desperate seller.

Don't under estimate how much the seller is willing to bargain and come off his asking price. The national average is about a 5% reduction in asking price, but right now you could get 4 times that.

Don't be afraid to low ball someone with a ridiculous offer, because they might respond with significantly lower counter-offer way below the asking price. I call this bracketing the seller which is similiar to calling in artillery until you can fire for effect. You really never know the psychology of the seller or how desperate they are to sell. If you are smart, you can make someone elses pain be your gain.

I looked at a farm several years ago and the asking price was $79,000 for 100 acres. I respectfully offered $35,000 to the seller and said the farm was too rocky and the access was poor. The seller used a profanity toward me, but 2 months later after his wife/kids had moved to Georgetown to take a new job, he called me back and asked If I would be willing to give him $50,000. I countered with $44,500 and bought the farm.

Good luck.

K

Good advice WBBP. Man, I thought I was brutal, I can't hold a candle to you, but that is sometimes what it takes.

[quackrstackr]

I missed out on an insane deal before I bought this one by thinking that philosophy was too good to be true.

We looked at a house way above my price range that I never even made an offer on because I figured they would laugh me out of the place. Little did I know how badly they needed to move it.

I found out a month later that they sold it for 25% less than what I wound up paying for this one (that was in my price range) and it was half again the square footage. :(

[WBBP]

Dang Quackr.....................The good thing is once you learn how flexible some sellers can be, you can use that to your advantage next time. It all boils down to you just really never know what some might be willing to do.

[muzzy125acc]

Good luck its always exciting... just a long process

[Brewtus]

Make Sure You Have A Clear Title.