Contemplating another Condo Purchase

A few month's ago we tried to purchase another condo to use as a rental unit.  Because the condo was going to be used as an investment property, we had to put 25% down, but it was so cheap we couldn't get a mortgage to finance the remaining cost of the house.  It's still for sale and I think it will be an amazing deal for someone.  The pictures online are horrible though and really don't do it justice so I have a feeling it will be for sale for quite awhile.

I'm glad that purchase didn't work out though.  The condo we live in is pretty small for a family of four + 1 fur baby, only 965 square feet.  We've lived here for 10 years now and lately, the lack of space has really been getting to me.  I've been thinking about wanting to move for a few months but didn't think Mr. R would want to.  We've always talked about staying here for the long haul. But we outgrew this condo a few years ago.

Since we have already discussed investing in more real estate, I decided to finally talk to Mr. R about it a few weeks ago.  I told him that I think we should rent out our condo and purchase a 3 bedroom condo for us to move into.  He was all for it and didn't have any objections.

It's been really fun talking about what we are looking for in a home.  We've never home shopped before.  The condo we live in, was a really great price and a great location so we purchased it.  We never took time to look around before.

The bank pre-approved us for $130,000 but neither of us really want to spend that much.

Last week we looked at 4 condos.  Two of them we could tell were not going to work for us but we really liked the other two.  Three bedroom condos are hard to come by around here so we are pretty limited on our selection.

Today, we looked at 2 single family homes that looked really nice online but turned out to not be so great in person.  We wanted to compare what our money would get us between a mortgage plus HOA fees for a condo and just a mortgage for a single family home where we had to do all the maintenance.  We all liked the condos better.

Mr. R and I are going back on Thursday to do a really thorough walk through of our favorite condo and then possibly put in an offer.

No New Investment Property for Us

I don't know if I'm sad or relieved.  It changes every couple of hours.  I really wanted to purchase the foreclosed condo.  Especially if we could get it for only $50,000 - $55,000.  It would be a great investment.  But we couldn't get the financing figured out.

In order to purchase the Condo we had to put 25% down plus pay closing.  But if we put 25% down then it would bring the loan to under $50,000.  I guess there is a rule among banks that a mortgage loan has to be a minimum of $50,000.  After days of calling people, I've given up.  I could probably try my luck with a credit union.  I called a couple times and didn't get a hold of the person that could answer my questions.  So I've given up.  I guess it's not meant to be.

I'm sad because it would have been a great investment, in good condition at a great price.  I want to have more investment properties but we've never owned a real house.  The only experience we have is with condos.  We love having limited responsibility for the property.  We are responsible for the interior and major appliances but we don't have to ever worry about replacing siding, getting a new roof or anything structural.  Investing in condos just works for us.

I'm happy because this investment wasn't something we were planning on doing at this time. I've been paying extra money each month on my car, the mortgage on our rental unit, and on our new HVAC systems. If we had planned on purchasing a property sooner rather than later, I would have been letting that extra money build up in our savings account to have more of a cushion.  Plus we only have 1 more month of childcare and then we are done!  Little R starts all day kindergarten in August.  We had planned on using that extra money to pay off some debt, build some extra savings, save for a nice trip and save for a down payment for a new investment.  If we had moved forward with this purchase, all of the extra money would be going towards the new property.

Evaluating a Potential Rental Property

Have you ever wanted to do something but everyone you talked to about it seemed to think it was too much effort to move forward?  I hate that.

There are currently 2 condos for sale where we live.  One was selling for $68,000 and the other is listed at $99,000.  Yeah, good luck with that.  The most I've seen any of these sell for is around $80,000 and that was quite a few years ago before all the prices started dropping.

I happened to notice last week that the $68000 unit was foreclosed on and they dropped the price to $61,900!

These are the hurdles I've faced this week:

1. Condo Association - I was under the impression that a decision had been made to not allow anymore condos to be used as a rental. But when the price dropped on this unit, I decided to check into it.  And Guess What?!  A decision was never made.  At this point if we purchase this unit it will grandfathered in as a rental unit.  But, the next condo owners meeting is Monday and we're still working out the financing so I'm hoping they just don't come to a decision at the meeting.  Usually not enough people show up and we have to have a vote done through the mail which would take a while.
2. Down Payment - On our last rental we had to put 20% down and pay for closing out of pocket.  It came to a lot higher number than I had anticipated and we took a lot of money out of savings.  Our closing costs came to $4700 when I was originally told anywhere from 3 - 5% of cost of purchase which would have been at the most $3400.   Mr. R and I decided if we go through with this purchase, we aren't comfortable pulling so much cash out of our savings this time so we need to find a way to finance the down payment by pulling equity out of the properties we already own.  Banks weren't very cooperative in this but I found a local credit union that was very helpful so I think we have this figured out.
3. Checking out the condo - From the pictures on the internet, it looks like a nice unit but not as nice as our other two.  I met with our real estate agent to view it and it was actually really nice.  It has some great features that our other 2 units don't have.  We would have to replace the water heater and there is a stain on the carpet in the living room.  If we can't get it cleaned up, we might have to replace that carpeting.  Other than that it's in good condition and pretty much move in ready.  
4. Financing - I talked with a mortgage lender that was recommended to me by our real estate agent.  This woman was really nice and told me upfront that there are going to be a lot of hurdles to jump through to get this property but she would do some research and get back to me.  The issues are:
1. This will be our 3rd mortgage so the lending guidelines might be more strict and we may be required to put more than 20% down.
2. It's a condo.  Apparently it's harder to finance a condo.
3. It's a Home Path Home which requires lots of additional paper work.

Moving Forward: As soon as we hear back from the mortgage lender, I want to go back and have Mr. R see the unit and then make an offer.  We are going to offer lower than asking since it's a foreclosure and we know the bank won't fix anything for us.  

We already own 2 of these condos so I'm confident this is a great investment.  I've ran the numbers too to make sure.  We live in a great neighborhood with highly ranked schools.  The condos are right next to a beautiful park.  I know the area and I know what we can expect to get as rent.  Our other unit rented with in 2 weeks of closing on the deal.  In those two weeks, I had tons of phone calls on it and did about 10 showings.  It rented for $825 per month.

Investing: Real Estate vs. Stock Market

I have had a little over a thousand dollars sitting in my sharebuilder account waiting to be reinvested and I just haven't gotten around to doing it.  As much as I have tried and tried reading about investing and learning as much as I can, I just can't seem to really get into it or truly understand it.

But real estate excites me.  I love reading articles about real estate investing.  Every couple of weeks, I look at the real estate listings.  On Thursday, I saw a house a couple streets away from us that was reduced to only $55,900.  It looked like it was going to go to auction but then it didn't.  After talking to our Realtor, it sounded like the owner probably filed bankruptcy.  He hasn't lived in the house for 2 years and he lives out of state.  The house had been on the market for over a year now.

I was really excited to look at it.  The houses around it were selling in the 80s and 90s. I knew that there had to be something majorly wrong with it for it to sit this long.  But in the back of my mind, I was really hoping it was just cosmetic stuff.  The house was a mess.  It amazes me that they didn't bother to at least try to clean it up a bit.

Unfortunately there was some major structural issues.  The basement walls were cracked horizontally and bowing inside.  I feel bad for this guy.  There's no way I would pay more than $20,000 for the house knowing all the issues.  He must not have had a house inspection when he bought it.  The paper work said the cracks had been there for 22 years so they were there when he purchased it in 2001.  Our Realtor said to reinforce the basement walls would cost around $15,000 to $20,000 plus everything else that would need to be done like some electrical work, landscaping, new flooring, painting.

It was definitely too much for us.  We probably shouldn't purchase another property just yet anyways as we are still rebuilding our savings after the last property.  But we are at the point that if we found a really good deal, we could do it.

But my criteria really limits us:

• Must be in our neighborhood.
• Must be $60,000 or less; preferably less 
• Must not need too much work

We live in a really nice neighborhood.  Right by a really nice park.  I am confident that we would have no trouble renting any property.  

Within 2 weeks of purchasing our last investment condo, we had about 10 people view it and a lease signed.  I set the price at $825 and every one I knew said that was too high even though after doing research I knew that I could get that... and I did.

On our way to a second rental property?

I just happened to do a quick search for condos for sale in our area.  And guess what?!  Another condo in our condo association is for sale.  We don't have enough in savings to cover another 20% down payment just yet, but I thought maybe we could tap into the equity in the 1st rental property.

This new condo is really really nice.  Looks in great condition and it already has a tenant paying $850 per month.  (We charge $825 for our rental).

I called the credit union and they referred me to the mortgage lady we worked with last time.  I wasn't really looking forward to contacting her since I kind of through a little fit with lots of tears right before we closed on our last property.  I felt that she misled us and when I get really mad I usually end up in tears.  I hate that.

In any case, if I want to go through the credit union I have to work with her.  So I emailed her.  She responded very quickly.  Unfortunately we have to have over 25% in equity to be able tap into it for the purchase of another property and we don't have that much.

I think Mr. R is relieved.  I don't know why, he didn't have to do anything last time except sign some papers.  He told me we can't buy anymore properties until we have $15,000 in cash in the bank.  We'll see about that.

But we definitely won't be buying this condo.  Unless it doesn't sell anytime soon so we have time to save up more money.

I'm a little sad.  It's a really nice condo!  And with a tenant already living in it!

Being a landlady - 6 month review

We recently collected our 6th rent check and so far all is well.  Our tenants are still really nice, we haven't received any complaints.  They haven't even needed us to fix anything yet. 

We did have an issue one day when the electricity was down in the whole neighbourhood.  The garage doors are electric and our tenant couldn't get into his garage.  There wasn't anything we could do though and they were understanding of this.  I have a key for our garage but I'm not even sure how that would work since the electric opener was put in.  But we don't have a separate key to open the rental unit's garage.  Just a back up garage door opener which requires electric.  Probably something we should look into.

The rent has been paid on time every month and their water usage (the only utility we pay from their unit) has been about the same as ours, so nothing excessive.  The condo association hasn't raised the monthly fees yet.  There was talk that it might come to that but so far there hasn't been any news.

After we pay all the bills each month, we have $325 left in income.  I always put $100 away for any home repairs that may come up.  This money also pays for the girls bumper bowling league fees.  I'm also using this money to pay our personal savings accounts back for money we took out for the down payment.  That will be repaid in a couple months and then I'll have to figure out what to do with the extra income.

So far I am still really happy that we went through with the decision to purchase the condo next door to us.  I'm happy we didn't let the naysayers affect us, most of whom have never owned rental property.  It was a very stressful decision to make and the amount of money we had to take out of savings to purchase the unit about made me sick.  But in the end, I'm really happy with the experience.

Once we get our savings account built back up or we have enough equity to use towards the down payment of another unit, I would be tempted to repeat the process and purchase 1 more.  But it will definitely be a while before that can happen.

One month review of being a landlord

Our tenants dropped off the September rent check yesterday.  I almost feel guilty.  I know we own the condo they are living in and there will be wear and tear and eventually appliances will need replaced.  But in the first month as landlords, we haven't had to do anything. 

Our tenants had told us their dishwasher wasn't draining.  My wonderful hubby who usually is not the DIY type just happened to remember that had happened to us when we had a new garbage disposal installed.  All that was needed was a piece of plastic punched out that connected the dishwasher to the disposal.  He told our tenants that was what it probably was and he would be over the next day to fix it.  They went ahead and did it themselves before he got there.  It was such an easy fix anyways.

The water bill came, it was only $35.11.  So after I pay the mortgage, water bill and condo fee for September, we'll have $368.

This is how that extra money will be spent:

• September Bowling League for Girls: $48
• Guitar Lessons: $68
• Home Repair Fund: $100
• Pay Back Savings used for down payment: $127
• Condo Insurance Fund: $25

Overall our experience has been great.  I know things will come up down the road.  Repairs will need to be made and we made not always have such great tenants.  But I'm glad that I didn't let all those what ifs and negative comments that friends and family made scare me off.  Most of the people that had negative comments had never owned a rental property any ways. 

Officially Landlords and Re-evaluating our Investment

We signed the lease today with our first tenants for our rental property.  I am so excited to be at this point.  They gave me a check for $1525 which covers the deposit and August's rent.  I told them I couldn't give them the keys until the check cleared but feel comfortable that there won't be any problems.  The woman gave me a copy of the bank statement to show they have the money.  Her husband and son want to be able to move some stuff into the garage tomorrow since he has the day off so I did let them have the garage door opener.

Here is a new evaluation on our rental property.  I am using the same calculator as before from here:

Purchase Price:$68000
Loan Amount:$54400
Interest Rate: 4%
Property Taxes: $627
Property Insurance: $262
Vacancy Rate: 8% or 1 month per year
Rent: $825 per month
Condo Fees: $110 per month
Extra Maintenance Expenses: $600 Annually
Misc Expense: $50 (background checks)
Appreciation: 2%

ROI with appreciation: 36.05%
Cap Rate: 8.44 (From what I understand through research, this indirectly measures how long it will take for the property to pay for itself. In this case, 11.85 years.)

ROI without appreciation: 26.05%
Cash on Cash: 19.26%

Accepted Application for Rental Property

I'm very excited.  I'm done screening our potential tenants.  They paid $50 to have their credit reports and background checks sent to me.  I also did a court docket search myself to see if anything had been missed.  Which it was interesting to see I found more on my own than what was shown on the background check that was paid for through a service.  But there wasn't anything major.

I've looked at pay stubs and talked to their current land lord. 

I think I've done about all I can to try to make sure we have responsible tenants. 

Our new tenants want to move in August 1st.  I've asked for a $500 holding fee since we are no longer advertising the unit and are holding it for them.  The woman told me she would bring it to me by the weekend.  Once they move in, the holding fee will then become part of their deposit.

I just received a new email today saying she is going to have the full deposit and Augusts rent for me all at the same time.  If she does give us everything at once, I'm going to give them the keys early without charging any extra.  Since the townhouse is sitting empty anyways, I figured they might as well be able to start moving things in.

We ended up charging $500 for the deposit plus another $250 pet deposit since they have a cat.  Rent will be $825 per month.  The first month I am only charging them $775 to reimburse them for the credit/background checks that they paid for.

I'm going to do another ROI analysis now that I know all the final numbers, but I'm afraid to do it before I get the check from the tenants.  They haven't officially signed the lease yet and I'm afraid if I start evaluating it, some how I'm jinxing it and they'll change there mind.

I've had a lot more requests for information even though I haven't added any new ads.  My old ads are still out there.  So I know we would find someone else, it would just suck to have to start all over again with all the showings and applications.

Screening our first potential tennants

After about 10 walk throughs, we finally have our first applicants for our new condo.  I'm taking my time to thoroughly research them.  I don't want to jump into anything but so far so good.  I've received the credit/background checks and tomorrow will verify employment and call their current landlord.

This has been a long process and it's exciting to finally be getting some closure.  I know we will always be managing this property but it was a scary decision financially and its great to see that it was a good investment.  We've had a lot of interest in the condo and will be getting more rent for it than I had originally thought when we first decided to go forward with the purchase.

Pinpointing the reason our rental unit isn't renting

Ok, I know we haven't even had our rental on the market for a full two weeks yet, but I can tell something isn't right.  We've had lots of calls, 4 showings, 2 of which really, really liked it to the point that I thought for sure they would put in their application and then I never heard from them again.

So I've been doing some research and I've decided my problem was the tenant screening policy that we are handing out with the application.  This was meant as a way to describe to the potential tenants what we will except.  This included the obvious stuff: no prior rentals, no felonies, good references from previous land lords.  Basically, I got most of it from a website and then added some info of my own.  It was long (about a page and a half) and sounded very legally worded.  I wasn't trying to scare everyone off, but trying to communicate that we live in a great neighbourhood and we are doing everything we can to screen tenants so that we have good upstanding people living here.  Especially since we live right next door to the unit. 

So I've totally redone our "tenant screening policy".  I'm still going to hand this out to potential tenants with the application.  I feel like it covers me so that people will know I'm not discriminating against them for an illegal reason but specifically shows that we expect:

• No previous evictions
• No Felonies
• No more than 2 misdemeanours in the last 5 years
• We will check references, verifying employment and ask for pay stubs.

But it is simplified and I took a lot of the legal sounding mumbo jumbo out of it.  I understand people may not have the best record or the greatest credit score, but they shouldn't be afraid of a credit or background check.  I just don't want child molesters or thieves or people that don't pay their bills and refuse to leave.

My point in handing out this tenant screening policy with the application is to protect us from someone saying that we discriminated against them illegally.  I don't care what race, religion, etc. etc. anyone is.  I will rent to anyone as long as I don't feel they are a financial risk or a safety risk to my family.  I'm hoping my new Tenant Screening Policy will communicate that better and not scare anyone off.

I have 3 showings tomorrow, so hopefully this will help get us some qualified applicants.

Bills, Bills, Bills...

Mr. Ripples pay check was nice this week.  He had picked up some over time.  I was going to be able to put an extra $200 in savings but had to use it for some work on the new condo.  It turned out the garbage disposal wasn't fixable so we had to purchase a new one.  We have a retired friend that does some work for us whenever needed so he installed the new garbage disposal and then did a couple more small fixes around the condo.  I paid him $60 for his time.

I'm getting anxious about getting the new condo rented.  I had to pay the $110 condo fee for it for this month.  Next month we'll owe electric and water which should be low since no one is living there and then the condo fee and mortgage.  I had lots of calls the beginning of last week, 4 walk throughs.  One couple on the 4th said they were really interested but I haven't heard from them since.  It's only been 9 days so maybe I'm worrying over nothing, but I think I might lower the rental price tomorrow from $825 per month to $795.

I've been keeping track of everything we've had to spend on the condo so that I can make sure once we start getting rent for it, I can pay our savings account back before I start counting any of the money as profit.  I feel like I won't be able to relax until then.  Maybe I'm rushing lowering the price.  Mr. Ripples thinks I should be more patient.  We'll see.

Adverstising our Rental

I've posted an ad on a local news site, craigslist and Zillow.   I was a little worried over the weekend since we hadn't really received a lot of calls but starting yesterday I've received a lot.  I had a family come look at the unit yesterday.  They didn't seem super interested but the woman called me this morning and asked when she could drop off their applications and if cash was ok for the app fee.  I told her I'd be home all night but she didn't show up.

I had another showing this evening.  I have another scheduled tomorrow, plus a second possible showing tomorrow and then one on the 4th as well.

I've been updating my post every day on craigslist and it seems that most of the calls are coming from there.  I've had two inquiries from Zillow.

So far the experience hasn't been bad.  I'm getting used to talking to people about the unit and not feeling weird about discussing money and credit and background checks.

I did have one woman that wanted a showing this evening.  She then called back and asked if I could meet her earlier.  So I arranged to meet her when I was on my lunch hour.  She then called me 2 minutes before our appointment and cancelled.  That was annoying.

We own our first Rental Property!

It was very stressful the last few days.  On Thursday I got the final amount we had to bring to closing and it was about $1000 more than we had anticipated.  I hate to admit it, but I threw a temper tantrum.  I was so mad at our mortgage broker and feel that we were misled.  Before we even went forward with making an offer, I asked how much closing costs would be.  I was told around $3200 maybe a little more.  Then when I got our estimate for closing, it came in at $3800 which I thought was a lot more not just a little.  Final total, $4712 and that was just closing costs! We also had to pay the 20% down payment.  We did receive a check for $500 back from the Real Estate Agency for the earnest money we had paid.  And we were overcharged by $50 on our appraisal so we will be receiving a check in the mail for $50 back.  But had I known we would be taking this much money out of savings, I don't know that we would have moved forward with it.  It's a little scary.

So the bad news is that we had to bring a lot more to the table at closing than I had anticipated when we started this whole process.  The good news is that our monthly mortgage payment is less than I had anticipated.

Mortgage Payment:          $311
Condo Fee:                      $110
Water Bill:                        $ 50 (Budgeting $50 but it should be less than that)
Insurance:                        $ 22
Total Monthly Expenses:  $493

We're hoping to rent it for $825 per month so that would bring in an extra $332 per month.  I listed the rental on a local news site and on craigslist.  If we don't receive any calls on it within a week, I may lower it to $795.  I'd still be really happy with $300 a month income.  When we first started looking into this, I thought we would only be bringing in around $150 a month so I'm really happy that our expenses were lower than I had thought.

For a comparable, there is another condo listed for rent at $825 per month and they aren't even including water in the rent, plus our unit is more updated and nicer.

Stressed out and Cutting Back the Budget

I'm starting to get stressed out about this whole rental property.  I was totally content with our decision to go forward with it, but the longer I have to wait the more I start to worry.  What if we don't get a renter right away or can't get the rent that I think we can.  Since the closing costs are about $800 more than I was originally estimated that's another big concern.  We are supposed to be able to close on Friday but the title agency called at 4:48 and of course I missed the call.  I had watched my phone all day until the end of the day and then didn't think to check it until after dinner.  The title agency is closed and left a message that they only have a 1 pm appointment left on Friday.  If we don't close Friday, then we won't be able to until Monday and I really really want to close so I can start advertising the rental and hopefully fine a good tenant quickly.  Then I'll have peace of mind.

I'm also getting stressed out about the big old check I'm going to have to write at closing.  It is basically depleting our joint savings account.  I justified this because we both have some money in personal savings accounts.  And if it came down to it, I could always sell some of my stocks or we could as a last resort get a HELOC on the equity that we have on the new condo.  Plus I really do think this was a good investment and will bring in at least a couple hundred dollars a month as well as cover all the expenses of the condo.

So I'm looking at the budget for ways to save extra money to rebuild our savings as quickly as possible.  Here are my new goals:

Lower Food Budget to $200 every two weeks = $60 per month extra savings
Lower "Extra" Money Budget to $225 per month = $15 per month extra savings

So that should give us an extra $75 a month to put into savings to try to rebuild our joint savings account as fast as possible.  Those are really the only 2 places that I can reasonably cut back.  We also usually have an extra $10 in our gas budget and an extra $10 - $20 in our electric budget so any extra money will go into our savings account as well.

Crazy Day but We Finally Have a Closing Date!

Lots of calls going back and forth between me, mortgage broker, realtor and insurance agent but in the end we will be able to close on Friday.  Here are some of the weird things that came up today:

• Mortgage Broker called and said the underwriter hadn't verified funds and she needed to know where the money was coming from to make the down payment and pay closing costs.  I provided all of our bank statements weeks ago.  I find it funny that we are taking out a loan that requires a 20% down payment and no one thought to look before today to make sure we actually have the money to pay it.
• Real Estate Agent called and said that the seller never had the double tap on the electric box fixed.  She said that we technically could walk away from the deal because of this.  I asked why the seller never had it fixed since it was in the contract.  Apparently the seller's brother told her not to fix it because the double tap was there when their mom bought the property so therefore they shouldn't have to fix it to sell it.  Really?!  It was in the contract that she signed!  I almost wanted to walk away just because they were being so stupid about it.  But in the end my real estate agent said that she and the seller's agent are going to get someone in to fix this at their cost.
• Mortgage Broker called and said that since the insurance policy I signed started July 1st, I had to have the insurance change the policy date to June 28th.  The Insurance company said this isn't possible, they have to cancel the policy that I just signed last week and open a new policy. The Real Estate Agent wasn't to happy about this because of course the mortgage broker needed proof of insurance today before we could schedule to close on Friday and this all came about around 2pm in the afternoon. 

In the end, it all worked out.  We are scheduled to close on Friday.  I'm just waiting to hear from the title company to actually schedule the time.  I'm keeping busy working on our lease agreement and advertisements for the property.

I found a great resource for beginning real estate investors at biggerpockets.com. 

Waiting....

I am so tired of waiting for to close on our new condo.  I've done all the math, all the research, my part of gathering information for the bank is done.  There's nothing I can do but sit and wait.  I want to start advertising to get a renter but since I don't have the keys, I can't really show it to any one.  Plus I don't know when I am officially closing so I can't even tell a potential renter when it will be available.

I'm really not so good at being patient.

Insurance

So I got a call today from our mortgage broker telling me that she contacted our insurance company to obtain proof of insurance for the new condo.  Which of course they couldn't provide her as I haven't taken out a policy yet seeing as we don't even have an official closing date.

How am I supposed to insure a property that I don't even own.  This does not make sense.  But the mortgage broker is acting like she needs this right away and asked me to call the insurance company today to get it taken care of.

So tomorrow, I am signing an insurance policy that will start on July 1st.  Even though, as I've mentioned, I don't know yet if we will be closing on July 1st.  It could be later.  So I could be paying for insurance for a condo that I may not actually own.

Does this make sense?  Not to me.

Repairs

We just heard back that the seller is going to do the repairs that we asked for on our new condo.  I'm super excited.  It wasn't anything drastic, just fixing a double tap on the electric box and having the furnace and A/C cleaned and serviced.  But I kind of expected them to say no and then have to go back and forth negotiating to at least get one of them done.  I'm surprised they said yes to both right away.

Now we're one step closer to getting our condo.  I've submitted almost everything the bank has asked for.  The last paper is a form that I have to have my husband sign and get notarized so he has to come into my work tomorrow to get that done.

Then hopefully that's it.  I'm tired of gathering information.  It hasn't been too hard or a drastic amount, I'm just ready to be done.

I've noticed I'm a lot more calm this time around.  When we purchased our first condo 8 years ago, I was an emotional mess.  It was a scary step.  Financially, we weren't really secure.  We both had good jobs but we didn't have a down payment or much of a savings.  I was worried about how much extra the repairs on a house could add up to be and the seller was kind of a jerk and refused to repair anything to the point where we were ready to back out.  I was only 21 at the time and really didn't know what I was doing and we didn't have a realtor.

This time, I'm much more patient and just going with the flow.

Closing Costs are Annoying

The bank sent me a detailed list of charges that will go into the closing costs and an estimate of what the amount will be that we need to bring when we close.  I did some research online and asked both my realtor and credit union mortgage representative what we could expect for closing costs and I never could get a straight answer.  I read online to estimate about 3% of the cost of the house.  Ok, that's only $2040.  My bank said a little over $3000. Ok so I'm thinking about $3200 at the most.  The total charges listed in my preliminary settlement statement are $3867.  That's not a little over $3000... That's ALMOST $4000.

It's frustrating because its not like I could price shop and I couldn't even get a real answer as to what all the charges would be ahead of time.  The seller requested we use a specific title agency since they already had a lot of the information from a previous deal that fell through.  The extra $600 - $800 isn't enough for us to back out, not that I think we could at this point just because of the closing costs being too expensive but we're already coming up with a big chunk of money for the closing and pretty close to the limit that I feel comfortable removing from our savings.  It would have been nice to have been able to have this information up front when we were making our decision.