Friday, March 8, 2013

Real Estate by Skype: A Buyer's Guide

Another FS blogger wondered how to go about buying a house sight unseen. When I put something on the Facepage in January about putting in a bid on a house we've only seen by Skype and experiencing a heart attack waiting for the seller's response, a lot of dips wrote that they've done the same thing. One friend noted he's still never seen a place he bought several years ago. Another noted he and his wife went straight through closing without ever seeing their house. Such is the expat life.

Here are my tips. Keep in mind that I know really nothing about buying a house, but I am currently occupying one and no one has sent the police over to tell me I did the whole thing wrong and I'm actually a very well-established squatter. I mean, I just painted, so that would be awkward.

1) Get a good agent. We love USAA and naturally took them up on their MoversAdvantage offer. As part of the program (well, as all of the program, really), they set you up with a broker in your market. If you close with that person, you get cash on closing. It's a nice sum of cash in any other situation, but in the context of buying a house, it's not a lot and it's certainly not worth maintaining the client-broker relationship if you aren't comfortable. For a number of reasons, the realtor USAA selected for us wasn't the best fit. Husband's friend from college recommended her broker/next door neighbor and I checked out his agency's website (Green Door Living, for those in the market for a house in Colorado). They were absolutely perfect for us.

What does that look like? Well, in our first conversation Christian told me about the current Denver market and what to expect (low inventory, booming demand, bidding wars). He spoke directly with our lender to make sure everything was going well. He spoke knowledgeably about each neighborhood, each street, and house construction. He was up for the long-distance buying process and understood our urgency. When we narrowed it down to seven or eight houses in two different areas of the city, he took my aunt and only Skyped me from two of them. He felt confident in our needs enough that he ruled out others for being too small, too structurally unsound, etc. We found this house on their first day of looking, but I had a couple reservations about the block. He drove back over to the house, called me, walked the block, and talked about everything he saw. He looked into the vacant house next door and found out that it was purchased in December. It made me feel really comfortable with putting a bid in long-distance and once we did put in an offer, he stayed on top of the seller to get a quick response. He held my hand through the buying process. Just everything about our broker-client relationship was great and that trust is imperative when doing all this sight-unseen.

Can you tell I like my broker?

2) Skype or Facetime into showings and the inspection. Use Google Streetview to get a sense of the neighborhood and surroundings, but keep in mind that it might not reflect changes on flipped properties, depending on when it was last updated. I am an idiot, and I kept wondering why our block was so gloomy and rundown compared to the surrounding blocks. Um, that's because it was a stormy day when Google Maps was on your block, and normal Colorado sun on the other blocks, you moron. Really, I'm that dumb.

3) Ask questions that normally don't need to be asked, because you would normally be there to see the house. How far is it from busy streets? What do the neighboring properties look like? What's the closest restaurant? Whatever matters to you, ask.

4) Ask your broker as early in the process as possible how contracts will work in your state. Can you do electronic signatures? Do you need access to a scanner or fax on short notice? Be prepared to hustle once you want to put in a bid. We were frantically signing things electronically to beat out another offer, but had we been required to sign and fax, we would have hired a sitter and camped out in the office for the night.

5) When working with your lender, consider whose income to put on your application. Many FS families have one consistent bread-winner. We had two until this month, but only put Husband's income on our application. They check your employment about a week before closing to confirm nothing has changed and nothing will change, and it would have derailed us entirely if they had to ask about my LWOP. If you work at the Embassy but don't have a job lined up for when you return to the States, consider whether you should put your current income on your mortgage application (this may be common sense for most people, but it wouldn't have occurred to me to not mention my employment until we went through this).

6) If you are going to buy from overseas, or anywhere really, go onto Employee Express, check your TSP address, change it to your actual mailing address (or a trusted friend or relative's, for quicker delivery). If you don't have your password, request one after your address has been changed. It took forever to get a new password, which meant it took forever to provide our lender my TSP statements.

7) If you are doing a TSP loan for your down payment or any part of the housing process, fill in the application online, print it, have your spouse sign it, and fax it in BUT ONLY ONCE. It will delay the process a bit if you do it more than once (speaking from experience). If you aren't sure whether they got it, call them later to follow up. But have your phone PIN. Please see number 3.

8) Ask your broker for a trusted EVERYTHING and join Angie's List. I'm not established in Denver. I know about five people here. I didn't know where to begin to find a good painter or fence company or anything. My broker hooked me up with our painters, who gave me a good deal because of the referral. Angie's List has a small annual fee, but you can get reviews on companies, which is how I found my fence guys.

9) If possible, stay with family or use cash for temporary quarters if you are coming home before closing. Don't charge a month of a corporate stay on your card even if you will pay it off every month, as your lender will check your credit several times once you are in escrow. I had to rent a car, get a cellphone (requiring a credit check), etc., but I stayed with family so at least I didn't have that expense. Credit checks and a change in your debt-to-limit ratio could scare your lender.

10) Lastly, in the hullaballoo of an overseas move, it is always helpful to have family swoop in and lend much-needed hands. I found this to be extra true when buying a house instead of renting. Because we came back to the country so soon before closing, I had to do everything at once. My mom, aunt and cousins have helped me pick up furniture, build furniture, accept shipments, unpack, distract kids, find a blinds company, go to Home Depot (really, I'm there almost every day), etc. I have vendors coming in and out several times a day, and having another adult or four around has been very helpful. Our window coverings salesperson (that is a thing!) was amused to walk into a house with four children and five adults and three animals, but that's how we got things done. I told my young and strong cousin and her fiancé that their wedding present would double in niceness for every piece of furniture they assemble. I'm not sure I was kidding. It takes a village.


alex said...

Thanks for this! We're in the middle of the house hunt now. Luckily my husband is physically in DC so that makes things a bit easier, but we'll have to buy without me ever seeing the place and deal with the electronic signature stuff you mention. Glad to hear it seemed to work out so well for you in the end! We've certainly had our moments when we're just not sure...

Carol said...

Thank you for these tips! I could use these in buying homes in new castle storage.