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First time home buyer around greater Boston areas.


donuteric
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The last post in this topic was posted 2021 days ago. 

 

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It's about time. Houses in the greater Boston areas are extremely expensive, so I've been going to open houses in the past few months to get a sense of what I want and what I can afford. I was going to build my nest egg for another year, but after learning my rent would be increased for another 20%, enough is enough. Pet friendly apartments here are not cheap, but paying over $2000 (and soon to be $2200) for an one-bed is starting to get really old. I am not even remotely close to the center of Boston.

 

The first most important thing to me is how much I can really afford.

 

I came out with a magic range by having some of the following requirements:

  • at least 20% down,
  • at most 30% DTI, including my auto and student loans, and
  • after closing, I still have cash or cash-equivalent assets for 6 months without a job.

My mortgage FICOs range from 760s-800s with the middle score at 770s. After working with a loan officer, I received the pre-approval letter today for an amount at 10% more than the magic range with 4% or below interest rate, depending on downpayment and market force.

 

I'm looking for a single-family home, but will entertain condos with reasonable HOA. After all, my magic range doesn't really give me too many options for a single-family house that is convenient to where I work.

 

I was also told for qualifying the best rate, I need either 20% down on single-family or 25% for condos. Not sure if that is common in other markets.

 

Anyway, it's time to go to see some houses and make serious offers.

 

I'll continue to update here with my experience.

 

Wish me luck!

 

 

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Good Luck with your search - It sounds like you are more than ready

 

The best rates do come with larger down payments

....anything less than 20% will likely have some sort of mortgage insurance - this is an added cost outside better to avoid if possible - If you cant come in with the 20% down it is the cost of business

 

 

B

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Thanks Brian!

 

After about 12 open houses last week and a few private visits, we've decided to put an offer in for a single-family above listing price. Many of these houses come onto the market on Thursday, open houses during the weekend, and offer is due by Monday or Tuesday. The process is moving so fast I feel like we're buying candies.

 

We requested a pre-offer inspection but was turned down by the seller's agent. Other than that, let's hope for a smooth business transaction.

Edited by donuteric
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Wow that's insane rental rates! I own a 5 bedroom home 3200 sq feet that I rent for 2200 a month in Florida. Up there it would probably fetch 5K. Geez!!

 

It's not uncommon for folks to pay over 3k a month for a decent 2-bed, and if one is looking for a pet-friendly place, prices are even higher. I'm staying 20+ miles outside of Boston and have been paying $1800+ a month for an one-bed that allows dogs. Any place within walking distance to a train station is naturally more expensive, as driving in and out of Boston during rush hours will severely degrade a person's quality of life.

 

Homes in good school districts are outrageously expensive. :( In some areas, 500k get you pretty much nothing and 650k might get you a small 1- or 2-bed under 1500 square feet. I've seen HOA fees that are as high as $800+ per month.

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Our first offer of just slightly above listing price was accepted! The amount was 10k less than our budgeted max for this property.

 

We were told there were 2 other offers and ours was just a hair better. We initially wanted to add an escalation clause, but decided against it. Instead, we agreed to take care of any home inspection issues up to $5k to show we don't plan on nit picking over any home inspection items.

 

We got the impression that the seller would like to sell as quickly as possible.

 

Onto the inspection this week.

 

The process has been super fast for us.

 

5/20: First spoke to mortgage specialist.

5/21: Submitted pre-approval application.

5/23: Received pre-approval notification verbally.

5/24: Received my pre-approval letter.

5/25-5-29: Visited open houses and requested private tours.

5/30: Submitted one offer and offer accepted.

5/31: Scheduled inspection.

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The home inspection revealed some expected issues with the boiler and the hot water tank, and some minor (cheap and DIY-able) issues. Other than that, we have the all-clear to proceed further.

 

While my agent is a friend, I decided to use an independent home inspector instead of the 3 he recommended. He's an honest person, but given there is a possible conflict of interest, we figured it's better to be safe than sorry.

 

Onto the P&S agreement next week. We also decided to hire an independent real estate attorney to oversee the agreement.

 

 

Congrats!

 

It sounds like you are more than prepared for this.

 

Thanks!

Edited by donuteric
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  • 2 weeks later...

We signed the Purchase & Sales agreement along with 5% deposit last Friday. Pretty standard language in the terms and the riders.

 

Although most of the closing fees are prepaid taxes and insurance, the fees add up to almost $10k. :(

 

Updated timelines:

5/20: First spoke to mortgage specialist.

5/21: Submitted pre-approval application.

5/23: Received pre-approval notification verbally.

5/24: Received my pre-approval letter.

5/25-5-29: Visited open houses and requested private tours.

5/30: Submitted one offer and offer accepted.

5/31: Scheduled inspection.

6/9: Signed P&S.

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  • 1 month later...

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