I Bought a House!
In my broke 30’s, I never thought I would ever be able to afford a prewar townhouse. But being broke forced me to live in affordable neighborhoods and by the time I got on my feet financially, I scrimped, saved and borrowed to buy an apartment in an undervalued area that doubled in value after I renovated it. I sold that apartment, and with a cooling real estate market, I was able to buy my dream home.
If you’re curious about the buying process, I’m going to spend a minute on what my real estate broker and mortgage broker contributed to the process. If that sounds dull as toast (but toast is delicious!) then skip to the end for pics of the house.
Why do you need a real estate broker?
Maybe you don’t need a broker, but here’s why I used one. My broker sold my apartment for more than I would have priced it. She was good at valuing the property, she played fair and marketed the property well.
Using a broker when you’re the buyer is a no-brainer. You’re not paying their fee, so why not have someone on your side? When buying my townhouse, the seller’s brokers seemed particularly slimy. Read my Yelp review for the full story, but in short, they aspired to shadiness, but were mainly incompetent. I did not want to get in their clown car alone.
You may be able to afford more than you think with the right mortgage broker.
New York City coop apartments generally require 20% down. This can be a huge financial barrier. But NYC houses and townhouses aren’t governed by coop boards. The down payment can be the minimum that your mortgage company requires. Which is 3.5% (in 2018).
I needed all the money from my sale for a renovation, so I paid 3.5% down. I currently pay about $500 extra every month on mortgage insurance (required by law if you pay less than 20% down), which is a bitter pill to swallow. But hopefully I can refinance in a couple of years, and the accrued equity in my home will cancel the mortgage insurance. This process is going to be full of short-term pain for long-term gain.
Just one caveat - even if you want to go with a mortgage with only 3.5% down, the seller may require you to put down a deposit upon signing the contract of 10%. While you will need to have this money upfront, your attorney can negotiate with the seller’s attorney to make sure the difference is returned to you at closing. It led to a few extra hurdles to jump near the closing but worth it to save the funds for the renovations.
The House!
My Team:
Mortgage Broker
Andrew Tucker
Meadowbrook Financial Mortgage Bankers Corp
main: 516‑867‑3020, ext. 366
direct: 516‑360‑2627
cell: 617-610-1576
Email: atucker@mfmbankers.com
Real Estate Agent
Rebekah Carver
Douglas Elliman
