In 2009, Susan and I were
homeless for over two months, trying to find a place to live. Susan
wrote about our experience. I wanted to expose this writing as a
guide and a warning to those who want to find a house to buy or rent.
I decided not to add anything; this writing is in her own words.
In 2009
because of a failing real estate market my partner and I found
ourselves homeless. For two months we drove city streets and country
roads in North Carolina, South Carolina, Virginia and Tennessee
looking for a home. We had less than 50K cash total to purchase a
home and no jobs to provide us with the possibility of a mortgage.
The resulting adventure was one of the most educational experiences
of my life and is the reason for me starting this blog. Somewhere
along the way I came to understand the meaning of what a home really
is and I saw a terrible displacement of priorities within myself and
among the people that we had to deal with to find a home. Those
issues are listed here to become a catalyst for discussion.
We
eventually found our home for less than 50K. It’s a single wide
manufactured home on one half acre in Tennessee. It was at one time
the furthest thing I could imagine as my dream home but it has become
truly the home of my dreams. It is gracious, cozy, comfy, a refuge
and my place of relaxation from the modern world and it is all these
things because I have made it not just a roof over my head but a
home; a very special home indeed.
In
2009 my partner and I found ourselves homeless. As two working
professionals, a teacher and an office assistant, both with over 30
years of work experience under our belts, we were both at a loss as
to what to do to remedy the situation. Job application after job
application left us with no prospects. And in order to avoid
foreclosure we had put our home up for sale, with a hope also of
making some cash to live on for awhile. We eventually had to lower
the price of the house, so low that we ended up making only 40k on
the sale, that after 3 years of renovation work from which we hoped
to make at least 100K.
So
we had to leave our home with nowhere to go and no hopes of
employment. We decided our best course of action was to try to get a
roof over our heads with the cash we had left and headed for
Tennessee, Virginia and North Carolina where we saw what looked to be
livable lower priced real estate, many of them mobile homes, or more
correctly manufactured housing, which I absolutely loathed and had no
intention of ever living in. With little choice, we loaded up the
car and went on a 3 month adventure that became one of the most
educational experiences of my life. I have decided to chronicle as
much of the experience as possible in the following pages, in part
just to remember, and in part as a guide for others who might find
themselves in a similar situation.
The
real estate market left us with a lot of hard learned lessons that I
have chronicled here. We got little help from anyone in our home
search, including realtors who clearly were not interested in showing
us properties listed for 50K or less. It didn’t seem to matter
that we were homeless or that we had the cash ready and waiting. No
one was willing to help us with the footwork or phone work. We
figured out early on that we had to do everything ourselves or we
would never find a home.
That
said our criteria was fairly liberal. We didn’t care about the
interior condition as long as it was livable and everything
functioned. Everything being the bathroom, the kitchen and the
electricity. Since we wouldn’t have much money left for repairs we
had to be sure that nothing major was needing to be fixed before we
moved in. We didn’t care what the outside looked like or if the
inside was 75 years old, as long as it all functioned. We didn't
even really care where the house was so we looked in cities and in
the country, and in a very wide area. We decided we would search for
employment after we got a roof over our heads. We felt and still do
feel that there was a house out there just waiting for us, just as we
feel that there is a home waiting out there for everyone who is
homeless. Everybody, no matter what their financial status or
education, should have an opportunity to own a home at some time in
their lives. This is one of the principles that moved me forward in
writing this book. That and the revelation that a house truly is
just four walls and a roof and no matter how it looks on the inside
or outside, making it a home is entirely up to you. We eventually
found exactly what we were looking for.
The
following chapters are a condensation of our time , which in reality
ended up being a little more than two months, three months if you
count sitting in hotels waiting for the closing. I chose to list
here the most interesting and educational of our experiences. The
hard lessons learned, which are at the end of each chapter, were
difficult and exhausting and would have been to hard to overcome
without a positive attitude and an incredible amount of
determination, two things which I am not generally known for, but
with the assistance of my ever supportive partner was able to bring
forth. Of course the thought of living in a cardboard box under a
bridge is bound to motivate most people in one direction or another.
And a little hot chocolate every morning didn’t hurt either.
I
have included definitions in the back of the book and other documents
which will be referred to during the course of reading. Above all I
have tried to keep everything as simple as possible. This book is
for the average person and is not meant to educate you to become a
realtor. But instead someone who can navigate the real estate market
with a lot of education.
Happy
house hunting and remember, you deserve to own the house of your
dreams, no matter how much money you have.
Chapter
1 The Day of the Cats
Well
off we go for our first day of house hunting armed with a healthy
breakfast and a whole lot of even healthier optimism. We were hoping
to have a house by the end of the week. It was a very hot, humid
July day so I dressed in the coolest most comfortable skirt and
walking sandals, a decision which I would discover later was a big
mistake. Knowing we would be riding around in a realtor’s car all
day I grabbed my big tote bag and filled it to the top with paper,
pencils, maps, drinks, food bars, and a long sleeve shirt to keep me
warm in a cold air conditioned car. We drove to the realtors office
just a few blocks away and piled into her SUV. We had met the
realtor before and had prearranged our time. We were to look at
three houses this morning.
The
first house was in a small historic town. We liked the idea of being
able to walk to the downtown area with small shops and a library.
But as we drove into this particular neighborhood my heart sank.
Some of the homes were very run down, even boarded up. But when we
pulled up in front of the house I was encouraged. A very cute
cottage of sorts with a front porch. Perched on one of the porch
rails was one of the cutest cats I have ever seen. The house was
surrounded by newly planted blooming flowers. Very cozy. The
closest neighbor's house was in good condition. This place
definitely has possibilities. As we approached the front porch the
cat made a run for it under the crawl space. My fantasies of setting
cooling apple pies on the front porch next to my blooming daffodils
quickly disappeared when the realtor opened the front door. The
smell that emanated out the door was enough to make me lose my
breakfast. It was an effort to enter the house. I tried not to
breathe.
Maybe
the tenants were cooking up something strange or simply didn’t take
out their garbage. The tenants were strange ones indeed. All the
windows were covered with heavy blankets making the interior so pitch
black that even with the lights on we could barely see anything.
When my eyes adjusted I saw that the interior was filthy. As I
walked across the living room my foot sank into a hole in the middle
of the floor. The floor was rotting right through to the crawl
space. A crawl space that was totally inaccessible for repairs
because it was only about a foot high. The bedrooms on the back of
the house have no windows at all. It looks like they enclosed the
back porch and didn’t bother to put any windows in it. In order to
get to the tiny bathroom you have to walk through both bedrooms,
neither of which was big enough to put a bed in. There is a back
exit out of one of the bedrooms which is an old interior door that
doesn’t fit properly, leaving a huge gap all around the door to the
outside and a nice place for the entrance of every kind of rodent
imaginable. The kitchen at the front of the house and the bedrooms
at the back were ad-ons to the original house and were only built
with 6 foot high ceilings. My partner has to walk hunched over since
he is over 6 feet tall.
The
MKS sheets say that this house is supposed to be 750 sf, but 250 feet
of it is an attic that can only be accessed from a pull down ladder.
Not really usable space except for storage, and should never have
been listed as part of the total square footage.
Outside
there’s a small backyard with an old falling down shed that we
decide is not salvageable. There is a new metal roof but as I walk
around the outside of the house I notice it appears that the vinyl
siding is melting off the house. The neighbor who lives in the nice
house next door comes outside to chat and feels compelled to tell me
that the current tenants throw their bacon grease out the window.
Just about the same moment that she finishes her sentence I look down
and realize that my comfy flat sandals are sliding around in a huge
mound of bacon grease, that has now oozed up over my sandals and
around my toes. I decide to take a moment to ask some neighborly
questions.
“Have
you been inside the house? Do you know what the strange smell is
inside? It smells familiar. Do they cook strange foods? Spices?
“No”
She says. “It’s the cats. They live under the house and use it
as a litter box.” Must be about ten of ‘em.”
Yep,
that’s it. A litter box smell. I slowly put two and two together.
A rotting floor, ten cats, nasty smell, an inaccessible crawl space.
I don’t even want to think about what else is under there. Even
if we get rid of the cats will we ever get rid of the smell! We’d
have to raise the ceilings inside to be able to stand up straight. To
much for our $2000 budget for repairs. I motion to the realtor that
I’m ready to move on, as I try to get some of the bacon grease off
my feet by walking around in the high grass. When we got in the car
I told myself that this was only the first house, not to get
discouraged. They won’t all be enormous litter boxes.
After
quite a long drive on many winding, narrow country roads past more
cows than I ever knew existed on this planet, we approached the
driveway to house number two. The house stood just at the top of a
rolling hillside overlooking a pastoral farm with a pond and
beautiful little white ducks floating around in it. I could
definitely get used to the view. From the top of the driveway you
could see the mountains in the distance. Nice. Maybe I’ll just
stand here and take in the view for a minute. I was jolted out of my
paradise found fantasy as soon as I started walking around the side
of the house and I was greeted by a half rabid, convulsively barking
dog trying to get at me over an 8 foot fence that had been installed
along one side of the property. Clearly to keep the dog from eating
anyone who happened to wander into the back yard. Well that wouldn’t
really make for a nice quiet afternoon in the garden. We ended up
standing outside for at least 15 minutes while the realtor made 6
phone calls to try and get into the house. Evidently the lock box
was not working properly. The entire time the dog barked
convulsively and almost hung himself by his chain trying to jump over
the fence and get at us. But we knew we couldn’t let a dog make a
decision about our house choice. We couldn’t afford to be that
picky. So we resisted the urge to move on quickly. So finally the
door is open and as we walk into the house we are hit with another
obnoxious smell, but this time we knew immediately what it was.
Walking through the door of that house was like walking into one of
those restrooms on the side of a truck stop gas station. The kind
where they just let the door stand open all day because the odor is
so strong that lighting a match might blow the place up. Except this
house odor was even worse because it did not come from human pee but
puppy pee, evident by the yellow stains on every square inch of floor
and on every wall in every corner of the entire house. The carpeting
had been removed but the OSB board underneath had been soaked and had
to be replaced. There was no getting away from the smell anywhere in
the house. We didn’t think anything would get that smell out and
since our $2000 repair budget would not allow for the replacement of
all the walls and floors, we moved on quickly. We waved goodbye to
the rabid dog and watched the beautiful view of the mountains
disappear as we drove down the hill to continue our search.
After
a few more winding country roads we end up at a very nice corner lot
even further out in the country surrounded by farmland. There was a
nicely maintained brick home across the street. The house we are
looking at appears to be a beautiful 1920’s Craftsman cottage with
a cat lying on the front porch. A big, fat orange tabby. Not being
a good day for dogs and cats in general I went into panic mode but
realized very quickly that this house did not have a crawl space but
was sitting on an enclosed basement. So no worry of the cats living
under the house. My panic completely dissipated when the cat got up
and slowly lumbered across the street to the nice brick house as we
approached. Clearly he was just visiting.
So
why was this beautiful house in a nice area selling for only 50K?
Well to begin with the lawn had been let go terribly. We had to wade
through waist deep weeds and grass to get to the house. A stroll
which left me with an enormous amount of mosquito bites all the way
up to my backside and taught me a hard lesson about proper clothing.
Alongside the house there was a mess which appeared to be landscaping
gone bad. They had dug an enormous hole and left it there. A pond
maybe? Large piles of rocks. Nothing that couldn’t be fixed. The
50K answer came when we went inside the house. The previous owners
had tried to do some renovations and never completed them. Much like
what they had done in the yard except this was worse. It appeared
they had absolutely no idea what they were doing. The ceilings were
left mostly unfinished with bare insulation hanging down from them.
Parts of the walls were ripped out in some rooms and doors put in
their place, except the doors didn’t go anywhere. Doors to the
outside were covered up on the inside but still visible on the
outside. Some of the walls were covered with what appeared to be
flooring. But we kept looking because the bones of a beautiful home
were still there. Hardwood floors throughout. A gorgeous brick
fireplace. A large eat in kitchen was in need of serious repairs but
we could probably handle it with our budget.
After
walking around for about 10 minutes we decided the place had
possibilities. Our biggest concern was another strange odor which
we could not identify. Not exactly a cat litter smell but a cross
between old garbage and a dirty bathroom. Strange because the house
was pretty clean, including the bathroom, except for muddy cat paw
marks all over the toilet, sink, and tub. We decided the odor was
just old cat litter and headed up to look at the second floor. My
partner got to the top of the stairs, stopped in his tracks and
motioned for me to turn around and go back down the stairs. I
assumed the stairs were dangerous, which is what they appeared to be,
but instead the source of the strange smell had been discovered at
the top of the stairs. It seems the odor was not old cat litter but
the actual old dead cat that we found out later through the realtor
had gotten trapped in the house by mistake. The listing realtor had
searched for him but never found him. He had probably been trapped
in there for a while. And the muddy paw marks! The poor thing
trying to get water out of the toilet and dripping sink. We pretty
much were just stopped in our tracks and couldn’t wait to get out
of that house and lock the door. I definitely felt sorry for the cat
but I also couldn’t begin to think about starting a new life in my
first home where a lovely creature had just suffered a horrible
death. The memory of the home was tainted and could not be repaired,
even though the house probably could be. It might work for someone
else, but for us being animal lovers it couldn’t be a
consideration. We never discussed that house again even though it
did occur to me as we drove away that the poor kitty had a final
resting place but I had to continue searching for mine.
Chapter
1 Hard lessons learned
1. Learn
to dress appropriately.
OK this is
one I should have learned when I was ten but never did somehow.
After watching too many house hunting shows where prospective buyers
are strolling through 300K homes in their business suits, I thought
it was important to look good, even though we were on a really low
budget. The truth is lower priced houses usually have unmowed lawns
and debris lying around. And you might have to crawl around in moldy
basements and attics. Covered shoes, long pants and long sleeve
shirts are the most appropriate attire for men and women doing this
kind of house hunting. We got to the point eventually where we were
wearing our old work clothes and taking along extras to change into
after getting into a mess. This is not house hunting for the
squeamish. So go prepared.
2. Seriously
nasty smells should not be occurring in a livable house.
I have a
good nose. If you don’t have one, take someone along who does when
you go house hunting. Nasty smells need to be searched out and
identified, especially if no one is living there when you are looking
around. Some smells, such as dampness, mold, and rot can have
serious health consequences. Seeking out smells means crawling under
the crawl space and into the attic and walking down rotting steps
into an old moldy basement, but it’s important. A dead cat can be
removed, but black mold can ruin your whole home. If you really like
a place but there was a strange unexplained odor, you can go back a
second time to see if the smell is still there, or hire an inspector
or clean up company to have a look before you make an offer.
3. First
impressions and experiences are important.
You’re
going to spend a lot of time living and working in this house. You
need to have a good feeling about it, even though you are searching
for really cheap real estate. A dead cat as a first impression will
ruin your feelings about the rest of the house. Realtors will have
the attitude that beggars can’t be choosers, but we did not settle
for something we did not feel good about. The home we finally
purchased gave us a good impression as we drove up to it, and when we
entered it we felt cozy and at home. We still love the feel of the
house. It's bright, sunny and cheerful. Just because you're not
spending 300K doesn’t mean you shouldn’t like what you buy.
Don’t settle for something that will give you night mares.
4. Know
your budget before you start looking.
House # 2
was on an awesome lot (except for the neighbor’s dog) but we knew
we could not afford to rip out all those floors and walls and replace
them. So we quickly moved on. Don’t waste your time looking at
something that is obviously over your budget.
Chapter
2 PODS, Pollution, Posturing
Well
I probably mentioned this before, but my partner and I were living in
hotels while we were doing the house hunting. We made a decision to
do our house hunting this way because we didn’t have jobs and
therefore could not rent an apartment. We also felt it was the
easiest way to search a large area, which we knew we would have to do
with a limited number of homes listed under 50K. Since this might be
the only option for other folks in the same situation I’ll take
some time to mention some tips and tricks here.
First
of all we put all our belongings except what fit into the car into a
POD. They are reasonably priced and they bring the container to your
house and give you time to fill it. No rushing to get the truck back
at the end of the day. We made sure that the pod storage place was
within a few hours drive of wherever we might be, which did come in
handy because we forgot to keep out some things we needed. And here’s
a tip on that. Put things you might need and necessities at the back
of the pod so when you open the door you can find them. I’m
talking about personal papers, pots and pans. These you don’t want
to drag around with you or leave in a hotel room to get stolen
either. I also bought two air mattresses and packed them with
sheets, etc., at the back of the pod for us to use in our new home
until we could have the POD delivered.
With
their delivery schedule you might have to wait a week or so, which we
did. This worked out nicely for us. We only had to move our stuff
once. Into the POD and out of the POD. And we could do it at our
own pace. You could also do it the old fashioned way and rent a
truck and a storage space. But I would only do that if you are going
to have help. Of course the cheapest way to store your things is to
find a relative with a big garage and if you are lucky enough to have
one, go for it.
As
far as hotels go, we kind of figured that out as we went along. In
whatever area we wanted to search we looked on the internet for
specials or coupons. We tried to get hotels with computer use and
refrigerators and microwaves, which saved us on buying prepared food.
If we thought we wanted to spend a week in a particular town we
looked for a place that offered weekly rates. These were the most
economical by far. And the less you have to move around the less
stressful your house hunting will be. Once we purchased our home we
still had to wait 3 weeks for the closing. At that point our realtor
got us a great deal, almost half price, on a nice hotel room with a
full breakfast and conveniences nearby. Most realtors should be able
to help out with some kind of hotel discount. All told we never paid
more than $65 a night for a room and weekly rates were around $300.
Cheaper than renting an apartment in most cases and much more
convenient.
A
final word on hotels. A lot of people feel that if you pay any less
than $100 a night you will be battling bed bugs. We were on he road
for 2 months and didn’t find that to be the case. We only had one
incident with fleas and some problems with moldy smelling air
conditioners. The best thing to do is to have a look at the room
before you pay. Any hotel will give you the keys to a few rooms to
pick one. Open the door, sniff, turn the ac/heater on and make sure
it works and doesn’t stink. Examine the bathroom. It should look
and smell clean. Look in the corners for dead bugs of any kind.
Pull up the sheets and mattress covers and look in the corners for
dead bugs or blood stains. Look on the ceilings for roaches. If
there are any problems move on to the next hotel. We found most
places were OK. If after one night we were uncomfortable, for
instance the non smoking section really wasn’t, we moved on in the
morning.
So
we’re back on the road again with the same realtor. It’s day two
with three properties to look at today. The first is a double wide
listed at 50K, a foreclosure. It looks nice on the outside, and is
on a permanent foundation which supposedly makes it more valuable
than one that has skirting around the bottom. It’s in a nice rural
development with about 20 other homes that look to be in nice
condition. It has a large front yard, a long concrete driveway, and
farmland behind. Looks great to me so far. There are tenants, so we
have to knock. We discover there are three children and a mother
living in this small 3 bedroom home. One of the children has a baby
of her own. The rooms are piled so high with stuff that we can’t
see the walls. The shower in the master bathroom had fallen through
the floor, literally. You could see underneath the house. All the
people were using one bathroom, and that one looked like it wasn’t
in much better shape. The floors in the kitchen and living room were
bare OSB board and they were rotting through. They felt soft when
you walked on them. It looked like the refrigerator was ready to
fall through the floor too. What is going on? Why is the landlord
not making repairs? We left in despair, not so much about the house
but about the conditions this family was living in. Where would they
go if we would buy this house? Can I afford to be concerned about
this? Anyone with a heart would be. But the larger problem was that
we didn’t have enough money to fix the floors and bathrooms. So
for now we are the ones who will remain homeless.
Home
#2 was listed for 35,900. It was quite a drive, past some beautiful
recreational lakes; very, very rural. Back a dirt road with
beautiful pastoral scenes, sheep grazing on hillsides. It reminded
me of a scene from Pride and Prejudice. We pull up to a sign that
says, “No trespassing, Herb Sanctuary.” Is this the place? Are
you kidding? The realtor knew what she was doing. I love herbs,
flowers. This place had herbs, flowers, trickling streams, a
greenhouse, a chicken pen and a view of horses grazing in a field.
It is an older single wide, but in good shape, it appeared, with two
outdoor decks, a hammock in the backyard, and walking trails. The
surroundings were really beautiful. Things had been let go though,
for quite a while it seemed. Lots of weeds, grown up paths. Someone
died maybe? We are trying to get inside but there’s no key for the
realtor. She makes some calls. We have to drive back to the small
town twenty minutes each direction to get the key. Do we still want
to look inside the house? We have another house to look at today.
We might run out of time. Well, we decide that we can’t make an
offer if we haven’t seen the whole thing. And we like it enough to
do that. So back in the car to the real estate office, everyone uses
the toilet. And back at the house 40 minutes later. We finally see
inside. Lots of antiques. Very well kept. Looks to be in decent
shape. No weird smells. It looks like they have a setup to dry
herbs. It looks like someone just walked away and left everything.
Lots of cobwebs. Dirty dishes in the sink, crusted over. The beds
look like they were slept in. Does someone still live here? The
realtor doesn’t know. She thinks they’re part-time residents.
Well, I guess that would explain it. Still, it seems strange that
someone would just abandon a house like this after all the work they
clearly did on it. And why are their belongings still here? We both
got a strange feeling about the whole situation. Even though we like
it well enough to make an offer on it we decide to have a look at the
3rd
house before dark and discuss this house later.
House
#3 is a double wide foreclosure listed for 50K in a nice rural area
closer to town and near a beautiful state park where we can go
hiking. It’s also on a large acre lot which we really like because
we want a large garden. The driveway is completely grown over and
the grass appears as though it hasn’t been mowed for a year. It is
waist deep with weeds, mosquitoes and I’m sure lots of ticks. But
I’m prepared this time with long pants which make for an easier
trudge through the debris. We are very pleasantly surprised when we
get inside. There are no strange odors and everything looks
perfectly intact. It’s even clean! We notice a few holes in the
walls but easily repairable. And we have to buy all our appliances,
but we can easily do that. There’s a back deck in decent shape.
We meet in the center of the house with smiles on both our faces.
This is definitely a doable house. And only on our second day of
looking! I feel happy and very lucky. I grab a copy of the MLS
sheet and start taking notes. I make a quick list of any potential
problems based on my self inspection education. We will go back to
the realtor’s office and make an offer based on what we see here
now and leaving ourselves enough money to do any necessary repairs.
We will add a contingency to the offer for a full inspection which we
will do ourselves after the water and electric are turned on. My
partner inspects the outside of the house and we head back to the
realtor’s office exhausted but happy. Our happiness did not last
long when after a few minutes on the phone the realtor comes out of
her office and informs us that there are already three offers on the
house and the listing realtor feels there would be no point in making
another offer. All the offers are higher then the offer we were
going to make. And now I’m angry, exhausted and confused. Why are
we looking at homes that already have offers on them? The realtor
says she didn’t know. Why didn’t she know? Isn’t that her
job? Is it up to us to find this out? Why are we wasting our
precious time like this? Every day in a hotel is costing us more
money. The realtor seems unconcerned with the situation.
I’m
grabbing my things to head back to the hotel when the realtor says
she can show us an almost identical house nearby with no offers if we
leave immediately. She is not sure of the condition of the house.
We decide to follow her in our car so that we can head right out to
dinner afterward. I am skeptical and feel that the realtor is just
doing it to make amends. Can’t she see we’re exhausted?
So
we drive about 10 minutes to an industrial area of town, not a very
nice location but the neighborhood looks OK. The front porch is in
very bad condition. We step lightly for fear of falling through. The
inside is a nice surprise. Even nicer than the last one. It looks
almost like no one has lived in it. It actually smells clean. Even
the carpets look unworn. The appliances are included and look brand
new. There is some minor wall damage. Easily fixable. There is a
sliding glass door in the dining room. I open it to a twelve foot
drop down to the lawn. No deck, no porch. Dangerous. There is
another back entrance off the house with stairs but it is literally
falling off the house and unusable. So the one front entrance must
be repaired before even moving in. I’ll try to get an estimate for
that on the internet later, probably a couple hundred dollars. The
lot for this house is a pretty steep hill with a small shed at the
bottom. About a half acre lot with a nice mountain view. We decide
to take inspection notes, and go back to the office and make an
offer. Everyone is happy, us, the realtor. So why do I feel
skeptical about the whole situation? Why does this nice house not
have any offers on it? While the other one in worse condition has
three when they are offered for the same price?
Nevertheless
we decide to move forward. Since this is our first experience with
offering on a foreclosure we decide to start at a low amount. We
assume that the bank is just jumping to unload to unload this place.
We start in the high 30’s. We wait in the office while the offer
is drawn up. There is a whole stack of pages we have to sign, almost
like buying a house. My partner gets out the check book to write the
earnest money check and the realtor says she doesn’t need a check.
Why the heck doesn’t she need a check? It says right on the offer
that we just signed that an earnest money check is included. How
will the bank know that we are serious? My skeptical feeling
increased and I leave the realtor office with that feeling but, also
a feeling of happiness and contentment that at last we are finding
some properties that are livable in our price range.
Before
we left the realtor told us she would be gone for the weekend and
unable to show us any homes. So we asked her to print out a list of
some more homes that we can drive by ourselves. That way we can be
ready if our offer is turned down. She prints out the customer MLS
with the directions so we can drive around.
So
back at the hotel with Chinese food in our stomachs we sit down to
review the day, and plan the next day. We did this every night just
so we are always on the same page and also so we know what our
schedule is for the next day. It keeps you from sitting in the hotel
watching HBO all day.
So
here’s how the conversation went:
Him-”So
do you think that sag at the roof line on the house we made an offer
on is a serious issue?”
Me-”What
sag in the roof? What are you talking about?”
Him-”Oh
come on now, how could you miss it? It was pretty obvious.”
Me-”You
mean we made an offer on a house with a sagging roof. Why didn’t
you tell me about it?”
Him-”It’s
right here in my notes.”
Me-”Your
notes. I didn’t see your notes.” We
just looked at each other, ate our fortune cookies and went to bed.
Tomorrow we start all over again.
Chapter
2 Lessons
1. Homes
must be properly ventilated underneath.
We found a
problem with this in many homes we looked at. Whether it’s a crawl
space or basement doesn’t matter. If there isn’t sufficient air
circulation under the house you will get rotting floors and mold. We
found basements where the windows had been boarded over and crawl
spaces that had been completely sealed shut for aesthetic reasons, or
just because the cats were crawling underneath. Any inspection book
will explain proper ventilation. There should be screens over those
holes so no rodents or cats can crawl under. And cross ventilation.
The results of doing it improperly I can tell you will ruin a home.
In the first house in this chapter there was a permanent foundation
and not enough vents. We also couldn’t find a spot to get under
the house to have a look. This is necessary for repairs, etc.
Usually they are in the form of a hinged door that you can crawl
into, hence the name crawl space. So the floors were rotting out
from under the house. And the remedy is expensive. Redoing the
foundation and all new floors. Not worth the expense in most cases.
So make sure you look under the house.
2. Research
the area for toxins, Superfund sites, well contamination.
Remember
the single wide with the beautiful herb gardens that looked like it
had been abandoned? Well here’s the story. We both had a strange
feeling about that house, but we both liked it also. So I did a
general internet search on the town itself. Nothing scandalous
there. Something that really bothered me was that it was a hot day
in July and when we drove by those beautiful recreational lakes there
wasn’t one person on them or near them. So I googled the lakes and
what I found was shocking. Hepatitis contamination in all surrounding
wells. Raw sewage had been dumped by the Tennessee Valley Authority
in the lakes years before and leached into local wells. Lots of
very, very sick people. Homes unlivable. You have to be able to
connect to municipal water to live in the house, otherwise you take
the risk of getting sick. You can’t wash your food with it, water
your animals or irrigate your garden. They have a map showing the
areas that are contaminated and this house was in that area. No
wonder they abandoned the place! We almost made an offer on this
house!! Chances are they would have accepted it because their
chances of selling it are slim. Closer research showed many, many
homes in the area for sale. Most with a notation behind it saying,
“can be connected to municipal water supply.” That’s an
indication that the water is bad. The hard lesson here is that you
have to research the area you are looking in. And if you notice
anything strange in the community, dig deeper. Start by doing just a
general internet search. Then go to EPA.gov. Or ask someone you met
on the street. Generally boarded up or abandoned homes indicate a
community wide problem and someone local can fill you in. There are
a lot of toxins you might be able to deal with such as a local paper
mill with a nasty smell, but you must have clean water to live
safely. Make sure you know what you are getting into.
3. Don’t
rely on the realtor to give you information about the area.
We called
the realtor and asked her to fill us in on the contaminated lake
situation. Shouldn’t she have let us know what we were getting
into? She told us she didn’t know anything about it. An
impossibility for anyone living in the area. It was a big scandal.
All over the newspapers. All those homes for sale. Anyone living in
the area, especially a realtor, would have to know something about
it. More than likely she just didn’t want to discuss the problem.
It’s your job as the buyer to get all the facts. Don’t expect
anyone else to do it for you. The burden is on you. So do your
research.
4. Most
banks do not accept contingencies on foreclosures.
This
sounds complicated but it’s actually really simple. A contingency
means that you are making a monetary offer in the house, lets say
30K, but before you are going to buy it something else has to happen.
For instance, you have to get the money inheritance, you have to
sell the house you are currently living in to get the cash, or, in
our case, we needed to turn on the electricity and water to inspect
the house. Most people and banks are OK with contingencies during
normal economic times. But when the market is glutted with homes that
could take years to sell, a contingency means that the seller could
be waiting a long time for the transaction to occur. So in hard
economic times, most people, and banks, don’t allow contingencies.
They want to get the deal over with as quickly as possible. Who can
blame them really? What happened in our case was an investor feeding
frenzy on homes. It cost the bank a lot less money to write up a
deal for 8 houses at one time with no contingencies than one house
with contingencies. So the investors were making great deals buying
up a lot of homes to renovate, resell, and make some cash. On these
smaller houses maybe about 30K per house. But what is happening is
there are a lot of people out there that desperately need a cheap
home that are being left out of the real estate market. And there
are a lot of empty houses sitting around. The investors need some
time to do repairs and relist (at a higher unreachable price). In
the meantime the house is empty. This particular house we made an
offer on is still on the market by the investor, over a year since we
would’ve bought it. And probably was empty for years before that
going through the bank foreclosure process. It’s my opinion that
these homes should be made available to people living on the streets.
With a little “homeowner repair” education they would become
great places to live.
So
we ended up eventually talking to the listing agent for this
particular house and he said there were no contingencies allowed from
day one. The realtor who took our offers and wasted our time waiting
on these offers didn’t bother to tell us that. We’re not sure
why. Maybe she didn’t take the time to find out herself. So
before making a foreclosure offer, make sure the bank is taking
contingencies. We would have not made the offer had we known that we
could not afford to buy a house without inspecting it first. If the
pipes were broken under the house we would not have had enough money
to fix them. The investor probably didn’t care because he wasn’t
going to live in it and had enough money to make any repairs
necessary. We also would have had to pay the connection fees, a few
hundred dollars, just to have the water and electric turned on. A
big investment for us at the time. And a big risk because while we
were inspecting the house, someone else could have bought it out from
under us. So if the house is a foreclosure you have to take all
these things into consideration, keep our budget in mind, and have a
lot of patience.
5. If
there are two people looking at a house, walk around and take notes
together.
I can’t
stress enough to take a lot of notes. Every detail is important
because when you leave you will not remember what you were looking
at. Especially if you look at more than one house in a day. I don’t
care how good your memory is. Have the realtor print out an MLS sheet
and take your notes on that. Walk around together and point out
everything that you see that should be discussed. Two heads are
better than one in this case, and I would highly recommend taking
someone along who can give you a second opinion. Studying an
inspection book is helpful but on the first visit to the house pay
particular attention to the following:
What is
the neighborhood like (better observed at night). Is it clean, are
there boarded up homes nearby?
What
is next door, business, house, empty lot? Across the street How
far is it to the nearest amenities (ask the realtor)? Where do you
have to park?
Observe the
house from a distance:
Are
there large trees leaning over the house that need to be removed?
Does
the roof ridge look level? Are there any obvious sags in the roof,
holes, etc.
Walk around
the house:
Where does
the yard begin and end if there is one?
Is the yard
private, is there a fence?
Are
you near a highway? Is there a lot of noise? What
is at the end of the lot, an alley? Another entrance? Is there a
storage shed, garage. What is it’s condition? Is there debris such
as old oil tanks that need to be hauled away? Take a quick walk
around the outside:
If
there are porches, what kind of condition are they in? What
kind of siding? How does it look?
What
kind of foundation. How does it look? Is
there standing water in the yard (bad drainage, full septic tank).
Are there
any unusual smells in the yard (septic or old leaking kerosene tank)?
Look for
erosion in the yard from poor drainage.
Inside the
house:
Note any
unusual smells such as mold.
What
is on the floors. Carpet, wood, vinyl. What is the condition? Do
the walls need to be repainted?
Are
there any water leaks on the ceilings, mold? Are
the kitchen and bathroom currently usable or will something have to
be repaired/replaced before you can move in? What are the
approximate sizes of the rooms? Will your stuff fit in the house?
Are there any unfinished repairs such as torn out ceilings that must
be completed before you can move in? Are all the appliances there
ie. stove, dishwasher, refrigerator, water heater? Do they need to
be replaced before moving in? How is the house laid out? Will it
work for your family? Draw a small floor plan if you think it is
unusual so you can discuss it later.
If there is
a basement and attic have a quick look. Do they smell moldy? Are
there water marks in the attic? Is there standing water in the
basement?
If you
review these points and have an MLS sheet you will have enough
information to sit down and discuss the home and calculate
approximate move in costs. Once you have done that you can make an
offer at a price that is logical and practical.
6. Ask
the realtor for a complete MLS sheet.
From our
experience it seemed that the MLS system was not very efficient.
Some of the MLS sheets have a lot of information on them. Some have
no more than the address and how many bedrooms are in the house. The
realtor will give you what is called the customer copy. We found
that this varies greatly. Make sure the realtor knows that the more
information you have the easier it will be for you to make a
decision. We had to in many cases, demand a proper MLS sheet. They
weren’t cheerfully supplied. The realtor wants you to call her
with questions, which you can. But in our experience it took many
days to get a simple question answered, like “how big is the lot?”
You don’t want to waste time this way. The “customer copy”
MLS sheet should contain the following:
Price,
address, county, bedrooms/bathrooms, lot size, schools, zoning
(residential/business), year built, square footage, exterior
covering, roof covering, appliances included, heating, cooling,
source of water supply (well, public), sewer (septic, public), type
of water heater, city/county taxes, directions to the house in case
you want to do a drive by after the fact or late in the evening.
Less information than this is not useful in trying to make a
decision.
When
the realtor that you go to prints out your MLS sheets they will have
their contact information at the bottom of the page, but that realtor
may not be the listing agent for the property. The listing agent for
the property is the one that met with the owner and helped them
choose the price and has the most detailed information about the
property. This, in our opinion, is the best person to show you the
property. They know the story behind it (grandma has to sell to go
into a nursing home) and can probably fill you in on the neighborhood
better than a non listing agent who has never seen the house before.
But if you’re going to look at a lot of homes you will have to do a
lot of running around to different agencies to talk to the listing
agent on each property. Not a possibility in most cases.
Also
the listing agent is a little more motivated since they will get the
full 6% commission if they sell the house whereas the non listing
agent will only get 3%. So this is what we did. We asked a lot of
questions about each property. You will have a lot of questions if
you are really doing a serious buying spree. The non listing realtor
then has to call the listing agent and get those questions answered.
In many cases this never happened and we never got our answers.
Remember, we only have 40K to spend. 3% of that is only $1200. Maybe
not worth a lot of phone calls, etc, to a realtor who is use to
making 20k on one sale. The listing agent however will make $2400.
A nice paycheck for sharing information that you already know. So if
we didn’t get the answers we needed we went to realtor.com. Put in
the MlS# of the property and got the listing agent’s name so we
could give them a call. In most cases this worked great. We got
answers to all our questions quickly. Our feeling was this. We
deserve as much time and effort as the guy with 300K. Realtors have
to accept the fact that there will be lower priced sales that will
require a lot of their time. That’s part of the job. Everyone
deserves to find a home they love. Unfortunately we found realtors
who understand this to be the exception, not the rule. We were
homeless and got very little consideration. Do what you have to to
get the information you need.
Chapter
3 If you want something done right, do it yourself
Well
as I said, the realtor said she would be busy over the weekend and
unable to show us any homes. We had made an offer on the double wide
that we eventually found out would never be accepted because there
were no contingencies allowed, so we wanted to keep ourselves busy by
driving around looking at some other available properties. We
decided to be loyal to this realtor since she had already put in a
lot of time for us. So we had her print out complete listings for
about 8 other possibilities with directions for drive-bys. Some of
the homes were empty (indicated on the MLS sheets) so we could also
inspect the exterior of the homes. Never, ever invade a person’s
privacy who is selling a home,even if you think they are not at home.
It’s frightening to have strangers walking around in your yard!
So
Saturday morning we piled in the car with a cooler full of snacks,
maps, MLS sheets, and a lot of optimism. It was a nice weekend and
we planned on a picnic at the local park. We also planned to stop by
the local college and use the computers to do more internet searches.
A laptop is a useful thing when searching for a house. Most hotel
rooms have free high speed these days. Some hotels even have public
access computers which are nice. But we found the most economic way,
without purchasing a laptop, was to make use of libraries and
colleges. We could each get a computer and so do twice as much
research.
Most
libraries allow you an hour at a time and will give you a visitors
pass. Most colleges had unlimited time and just asked for some basic
information to give you a temporary card. Of course students get
first priority so if you’re there during the school year you might
not get access. We were looking during the summer sessions when
fewer students are around, and so had unlimited access.
So
we’re headed out for a drive by day, which we found to be a very
important part of our searching as time went on. As a matter of
fact, by the time we got to the end of our two month spree we were
doing all the drivebys by ourselves before we even considered going
there with a realtor. We found that we had wasted a lot of time
driving around with realtors who probably had nothing better to do
and in many cases were showing us things we just weren’t interested
in, couldn’t afford, or didn’t have the money to fix. Even
though we let them know exactly what we needed. In many cases we
knew as soon as we drove up to the house that we weren’t
interested. Many were in horrible neighborhoods and weren’t even
easily accessible with our little Toyota Tercel. Many of the realtors
showed us listings that we didn’t even agree to see. They just
drove us to the houses while we were out looking at other homes. I
guess the thinking is “you never know.” But here we were wasting
our time and money on hotels, which the realtors all knew.
Frustrating, to say the least. And we are not rude people, so we
went along with the game and didn’t complain. A big mistake on our
part.
So
eventually we did it this way. We chose a real estate office in a
particular town by looking in the free real estate publications to
see who was listing lower priced home. These real estate offices
seemed to have the most knowledgeable realtors concerning the cheap
real estate. Then we went to their office during office hours and
asked them to print us MLS sheets on the lower priced homes (the
complete ones with directions). In most cases someone was more than
happy to do it because it saved them the time of driving us around.
The realtor that gave us the MLS sheets would give us her business
card and if we saw anything we wanted to look at we would call her.
Sometimes they would drive out and meet us there, which was the most
convenient of all.
We
were able to save a lot of time and eliminate a lot of houses this
way. Many were in very bad neighborhoods, at least for my taste, or
were clearly beyond repair. Some had streams running through the
backyard and could easily flood. Others had train tracks 8 feet from
the back door which definitely wouldn’t make for that “zen”
feeling.
Plus
you can take the time to drive all around the neighborhood and have a
look. If the home was in a small town we parked the car and walked
the streets. You notice a lot more on foot than in a car.
You
can tell if a home that is for sale is unoccupied by looking at the
bottom left of the mls sheet where it says “showing instructions.”
It will say “lock box vacant.” Which means that no one lives
there and there is a lock box on the door which the realtor has to
have the key for to let you in. Or you can ask the realtor that
prints the sheets for you, although they might not know unless they
happen to be the listing agent. As I said before, never walk into
the yard of a home that is for sale unless it is vacant. Sometimes
it’s obvious that the house is empty, but other times it is not.
If it is, you can do a thorough outside inspection of the yard and
the house without the realtor and even peer in the windows. This
will help you eliminate any homes that clearly have very serious
exterior problems.
With
the direction on the MLS sheet you should be able to find the house,
although many times we got thoroughly lost. We found that in most
cases the directions started at a clear cross street or from the
realtor office itself. But other times it was not clear whether we
should go east or west. So it’s useful to have a map of the area
handy at all times. If you are lucky enough to have a GPS your
problem is solved, or maybe you can borrow one for your drive-bys.
Also
when you do the drive-bys yourself you get to see more of the area,
since you have to look for landmarks, street signs, etc. We found
that we were much more aware of how far away the grocery store and
other conveniences were when we were doing the driving. When the
realtor is doing the driving you don’t need to pay attention,
although a good one will point out all the conveniences if they know
you are not familiar with the area.
