It is a very important document and I learned with the purchase of my first house just how valuable it is.
In March 2003, my 22 year old self went all around the small town where I was living to find a house to buy. Interest rates were the lowest they had ever been and my rent would be the same price as my mortgage. All twenty two years of me were about to be a proud home owner. The little 1200 square foot house I found on Elmwood absolutely fit the bill.
Looking back, I had no idea the house was so "small." It felt massive and I could barely afford to furnish it. I made a back room into an office with a computer on a folding table and bought some used cherry wood twin beds for $250 and asked if I could have the mattresses.
Those beds are in Bennie's room right now.
The house was a "FSBO" and my realtor showed it to me. A woman I worked with mentioned that I could cut out my realtor and save some money. Saving money always sounds like a good idea to me, so I called my dad and he explained to me how realtors get paid.
It was a good lesson.
Realtors work on commission and all those houses she showed me, free-of-charge, were her working towards me finding my house so she can get paid. In the end, that $2,600 would effect my mortgage payment by, ohhhh, $4 a month. $4 a month was worth my integrity and good name and I am thankful that my dad took the time to explain to me how realtors get paid.
After all, I was only 22 years old.
My parents drove up for the closing. At the attorney's office, the seller was on the far side of the table by herself and I was there with my entourage- parents and agent in tow.
Some numbers are hard to forget- I bought the house for $80,000. My mortgage was $518 a month.
Our taxes are $518 a month now. My, how life changes.
If you have never purchased a home, let me paint a picture- the attorney gives you a brand new pen and goes outside to chop down a tree. That tree will turn into a stack of paper and you will sign every. single. piece.
Upon the conclusion of the closing, your dead pen will be thrown in the trash, having expended all ink that it could carry.
As we neared the end, the attorney handed the seller a check and she stared at it with a funny look on her face. The attorney did not notice and kept shoving papers under my nose to sign.
My dad commanded the presence of all in the room, raised his hand and stopped the attorney. He looked at the seller, who was 8 years my senior.
"Are you okay?" he asked.
"Yeah, I mean... I just thought the check would be more than this." she responded.
"Do you want to call your father? I'm a daddy and I get it. We can pause this while you call him," he said.
"No. No. No, I shouldn't. It's fine. He's playing golf right now and would be really mad if I interrupted his golf game," she said.
"Are you sure?" Asked dad.
"Yes, I'm sure. I have to meet some friends for lunch," she responded.
Fateful.... Last.... Words....
It's hard to see the forest through the trees when you are staring at a $70,000 check. Unfortunately for her, she thought she was getting closer to $100,000.
We had offered her a ridiculously low offer and she accepted.
Please don't ever wonder why we offer low prices on the houses we buy. Now you know-- my first house was $80,000 which was over 30% off the asking price.
When we left, my dad told me that this was a wonderful lesson for me in purchasing a home:
- you looked at a bunch of houses, found one you can easily afford.
- you had the opportunity to cut your realtor out of the deal, but came to the decision to pay her yourself once you understood how realtors are paid.
- you saw what happens when you don't pay attention to details.
- And you now know that you can always interrupt me if it is important.
"Every step of this, we did it with integrity and I am incredibly proud of you. Let's go see this new house of yours."
I would sell my turquoise kitchen about a year later and move back home to start selling insurance. I would be working on 100% commission and be on the bad end of people who would run me ragged and leave me high and dry. It made me appreciate the purchase of that house even more.
14 years have passed, almost to the day, since I bought that day I bought my first house and I am eternally thankful for the experience.
As I close this blog, I check my email one more time looking for the HUD document and it still isn't there. I am sure that the girls in the office are rolling their eyes that I am going to call again. But, they did not see that girl across the table with the funny look on her face when she looked at the check. The stakes are higher now and the mistakes are bigger.
I don't like those kind of surprises.
|My first house-- pulled from the tax records. Looks like they changed the door and took out the hydrangea bush.|