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A First-time Homebuyer's Blog
Can We Afford It?
Our landlords approached us and told us they were considering selling to a friend who was all ready to
get the loan process up and started. They gave us the opportunity to see if we wanted to buy first.
Sometimes you just don't know what you can get approved for, or what rates you may qualify for.
From what I've figured out, anyone can get a home loan... it's the rates that you won't be certain
of until you give all of your information over to the loan officer.
Since our landlords were doing a "For Sale By Owner" (a.k.a. FSOB), we didn't enlist the services of a
realtor. We did, however, ask for advice from
Doug Francis, an excellent realtor in Northern Virginia who has helped many Mythic employees find
homes in the area. In the future, I think I'll use him as a buyer's agent. There's just so much that
goes on with a loan, that you aren't certain what you are supposed to be doing and when. Mortgage
Brokers can take advantage of this and mislead you into a loan that you may not qualify for, which
can lead to a very big surprise come closing. Thankfully, we didn't have this problem.
Per the advice of a friend, we began calling around to a few brokers in the area to shop around for
rates and to see if we can qualify. We had to do 100% financing, because our landlords caught us out
of the blue with the whole thing. We didn't have any savings except just enough to cover the closing
costs, and we also had a bit of debt that would have prevented us from being approved for lower rates.
When those options failed us, I turned to
LendingTree.com. I know, I KNOW, it sounds fishy, and you never know what you're going to get with
an online service like this, but it worked. It worked just like in the commercials. You put in some
basic credit information, and you will get four offers back within 24 hours. I had gotten several
phone calls within 1 hour of inputting my information and one lady that never did call me, though she
emailed me a few times saying she was about to call.
We ended up selecting Nationwide Lending
Corporation, a direct lending company located in Irvine, California. The time difference is something
that was a challenge, but nothing that couldn't have been worked around. Our loan officer,  ,
was extremely helpful and honest about the loan program he was putting us into. Sometimes brokers can sound
like used car salesmen, but Cory was never misleading or dishonest about the loan process.
I got nearly halfway through the process with another broker before working with Cory. That broker, while nice and hard-
working, never explained the loans to me or never got me the information that I needed on the banks or the
types of loans we were being worked into. For example, the other broker had placed me into a HELOC for the
second mortgage. If you don't know what that is, a HELOC is a home equity line of credit, which can fluctuate
on a monthly basis depending on what the US Prime Number is set at. Right now it's 5.5%, and it is on the rise
according to Greenspan. That means that though our payments would be very low for now, in a year they could
almost be DOUBLE what we were paying before. Not good... and not an honest way to work. But Cory wasn't like this
at all, and I highly recommend anyone using him for their homebuying needs.
Starting the Loan Process
The loan process is long and drawn out. It will lead to many sleepless nights and lots of butterflies in
the stomach. I was nervous the entire three weeks of our loan. We had to scrape up everything on our lives for
the past twelve months. It was a pain trying to get all of this information, but the quicker you do it, the
quicker the loan officer can work his or her magic.
These are the documents we had to provide to our lender. It's pretty typical to have to round up all of this
information as a first-time homebuyer:
- 12 months of cancelled checks to prove you paid rent
- 1 months worth of paystubs
- 2 months worth of bank, 401k, and/or savings statements
- homeowner's insurance contact information
- the past 2 years' tax returns (i.e. 2003, 2004)
- purchase contract on the property
By the time you're done gathering all of this, you'll swear they'll ask for a urine sample next.
The Purchase Contract
Now, typically when you make an offer on a home and it's accepted, the sellers and the buyers will sign a contract
of purchase. Basically this locks you in to buying the property, and there isn't really a way to wriggle yourself
out of it. It is a legally binding contract that states your intentions on purchasing property. Even the sellers
can't back out of it.
In our case, we had a clause that handled the failure of an appraisal meeting the sale price of the home. I'm very
glad we got this thrown into the purchase contract, because the home did not appraise for the sale price
and it led to many problems trying to get the loan. We had to get our landlords to negotiate the price down to the
appraisal value in order to let the loan go through. Since we were doing 100% financing, there wasn't really any
wriggle room for the loan.
Since we've lived on the property for so long, the landlords didn't really require earnest money (a deposit on
the home to say "yes, we're buying it"). It is a very trusting relationship, and we're very thankful for that. It helped
a lot during the entire ordeal.
Landing a Title Company
Some lenders have a title company they prefer to use, but we went ahead with a coworker's friend in Maryland who
owns her own title company, Emerald Title. They don't have a website yet, or I would have linked it. Michelle
Hoskam worked her tail off getting this thing to close in just under 3 weeks. It was insane all of the things she
had to put up with and work out over the course of the loan process. Since most of their business is by word-of-mouth,
I've made sure to include their contact information at the bottom of this blog.
Making It To Close
We finally closed on the house at the very last day of March. That's important, because we didn't have to pay but one
day's worth of prepaid interest. It helped a lot with the closing costs. We signed a stack of papers about 4 inches
thick. And yes, we had to sign EVERY LAST PAGE. It took about an hour to an hour and a half to finalize everything.
In the end, we own a beautiful townhome with the following specs:
- 3 bedrooms
- 2.5 baths
- 2 car garage
- 2138 square feet
- walk out basement
- washer/dryer
- end-unit townhome (only one neighbor, yay!)
- 6 months "young"
- wide open country kitchen
Referrals Abound, Use These Guys!
Below is all of the contact information you could ever need for our lender, title company, and realtor (who we really
wish we could have brought into the entire contract, but the landlord didn't want realtors involved). Please use
these people and do tell them who sent you!
Nationwide Lending Corporation
www.nationwidelending.com
Phone: 1-800-819-7010 extension 1172
Fax: 1-888-568-7748
NOTE: Please contact Cory directly via email or phone. If you use the website, they'll route you to
someone else as a loan officer, and I can't guarantee they'll be as good as Cory!!!
Emerald Title & Escrow
Phone: 1-301-947-9080
Fax: 1-301-947-0675
www.dougfrancis.com
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