Episode 4: It was supposed to get less weird when we found a house! OR If you can’t be a good example, be a horrible warning.
We found a house!
Life can start happening again!
Oh, wait, this reality is just as bizarre as house hunting. At least it’s less time consuming… that’s something right? Right?
There’s this phrase that I love ‘If you can’t be a good example, at least be a horrible warning’. Let this be a lesson to those who come after us. The laws governing house sales and finance changed in 2008 and some of the after effects are looking-glass weird if no one explains them. Ok, even if someone explains them, they’re still mock-turtle weird, just easier to accept as reality. Here’s my disclaimer: This is the information as I understand it. I’m not a mortgage broker or a realtor. I’m just a person buying a house. If you experience any of this, for the sake of your diminishing sanity: Ask all the questions! No, don’t ask me, ask your realtor, broker and bank.
So, before you even started looking for a house, you got pre-approved for financing. You did that, right? You spent hours digging up last years W2s, figuring out how to print your bank statements (Who does hard copies anymore!), and pulling pay stubs before you went to the broker’s office. Then you spent an hour or more answering questions, signing documents and generally verifying that you’re worthy to be their client.
A little while goes by and the broker tells you that you’ve been approved for a loan of ludicrous size and they send you a copy of your current credit score as a courtesy. Actually, they’re legally obligated to let you have a copy – which is neat. I still don’t have an explanation for the size of the ludicrous loans people are ok’d for: Sure, we could cover the size loan we were approved for, but we’d never eat anything but Ramen again. What’s the fun of owning a house if your cabinets only have cardboard noodles and MSG in them?
Next, you spend a painful, emotionally distressing period of time house hunting. It’s amazing how stressful just the thought of not having a home is. I’ve been fortunate enough to never experience homelessness and just knowing that our house had sold and we didn’t yet have a place to move gave me a tick of stress that ratcheted up just a little every day. The day I get the keys to our new house I need to make a donation to a homeless shelter – because damn, that was stressful and it was nothing in comparison.
Now, you’ve bid on the house, had the offer accepted (Hooray!) and everything that’s left is supposed to just be paperwork and details. This process uses so much time and money from so many people it’s like a flaming tar pit that you just sacrifice dollar bills and pocket watches to. There has got to be a more efficient way to do this now that we have computers. And calculators. And freaking email! It feels like it’s all still getting done by abacus and pony messenger.
Now you get to talk to the Title company – they’re this neutral third party that makes sure the house you’re buying is something you can legally buy. The Data Analyst in my brain screams that all of this information should be in a single database somewhere in the country since house sales are PUBLIC RECORD. Title insurance should have become unnecessary 10 years ago – between the IRS, NSA and Homeland Security I find it hard to believe that ownership of any property is still in question unless there’s an active lawsuit. Sigh…yes, I’m sure there’s real legal needs for it, but from an average house buyers perspective, it all looks incredibly stupid and wasteful. The Title company also often takes care of Escrow accounts to cover property taxes.
Which brings us to Oregon property taxes. Fun fact: Oregon property taxes are paid in November of this year for July of this year through July of next year. So if you’ve ever wondered why escrow amounts always look strange: its because they are. The good news is if you sold your house, the bank has to give you back the money left in your escrow account almost immediately. They can’t legally keep it for a year…Which a bank did to us pre-2008 when that a**hattery was still legal.
Then there’s the mortgage broker. The weird financial matchmaker for love-less loans and their hair raising paraphernalia. This side of things, I think they were probably a good idea for us. If for no other reason than I had a person with an accessible office that I could send all my questions to and get answers.. The mortgage broker handled getting all the documentation from us that the lender required. So when they asked us for something I thought was weird, I could email or call and say something like ‘WTF do they need to know that for – it’s creepy!’
The first time I saw the list of documents from the broker, I freaked out a little bit because it’s creepy from a privacy standpoint. They want to know way more than I’m comfortable telling. Before I handed it over I made them tell me why they needed it. It went something like this:
- Most recent 30 days pay-stubs for each of you – Sure, they need to verify that we’re still making the money we were when they approved us for the loan
- W2 forms for the past 2 years: Ok, sure, they’re making sure we’ve continually made the money they expect for the past 2 years.
- Federal tax returns for the past 2 years. Not the summary sheet, the ENTIRE tax packet for the last 2 years. Including contributions to charity, union membership, medical expenses and anything else you had to claim. This was getting personal and a little creepy to me. I don’t like sharing that information with anyone – it reeks of giving someone enough information to deny you a loan because they don’t approve of your political party or union or church.
- Most recent 2 months statements from all checking and savings accounts. This is what sent me over the edge – I definitely don’t think it’s any financial officers business where I ate dinner, what stores I spent money in or how often I go to the arcade. We live in an age of debit cards so the details of all those purchases show up on our bank statements now.
I got the list first and called my partner in crime about it. His immediate response was ‘No, that’s crazy. That can’t be what they’re asking for’. Except it is. That 2008 law made changes that allow lenders to look for undisclosed expenses and unreported debt/income ratios. They’re not supposed to care that I donate to Planned Parenthood or buy fudge sundaes way more days than is healthy.
That Federal tax return is so they can see undisclosed rental properties, self-employment, and spousal support that was recorded out of state. The bank statements are so they can see if you borrowed against a credit card to make your down payment, got a down payment from the seller without telling the bank, or if you got the down payment from friends or family that you’ll have to pay back. So, there’s a pretty good reason for the bank asking for the documents, but I’m still a little squidgy about it.
Once you turn all the documents over, you wait. For WEEKS while paper acolytes pin each document to the sacred vault wall and perform intricate supplications to the gods of Wall Street and Hysteria for a sign that you’ve been approved to receive the holy grail of house buying: The Closing Documents. I’m sure there’s more to it than that, but every time I called to ask what day we’d be ready to close all I heard was chanting and muffled drumming. Once I thought I heard a human sacrifice screaming in the background but it was probably just someone getting a paper cut. Yeah, I’m sure it was just a really bad paper cut.
Magically, one day you get a call and they tell you that you have to be at an office you’ve never seen before to sign papers and you have to get to the bank today (Right Now!) to get a cashier’s check for the closing costs before they close. The call to your boss that you’re going to be out of the office for 2-4 hours the next day has to happen too. Cue the irritated sigh from my boss right here. Actually I’m pretty grateful on that front: having a boss whose only irritated at the inconvenience is awesome.
The next day you sign a thousand times on a stack of forms the size of a bible. This time the updates in the laws were fantastic. All the forms had to be in a text size we could read. On our first house, there were literally dozens of pages printed in 6 point font – not even kidding about that. We spent hours in the too-hot, too-bright office of a set of angry angry brokers and lenders reading the tiny script on every page before we signed it. Heh. Good times. But this time was way better. We could read everything and there was a third the paperwork as last time. After that, you wait 24 hours or so and get an email from the broker, the lender, the title company AND your real estate agent telling you that the sale has been recorded and you are officially the new owners.
Because the Portland market is still nuts, now all you have to do is wait to get the keys. Because almost everyone is doing a rent-back on the house they’re selling.
So here we sit. Waiting for the keys….. And Waiting….. Buying furniture that doesn’t fit in our current house and tripping over it until every toe and hip is bruised….And waiting some more…Then buying nerf rifles and using the furniture as cover for an indoor battle because being an adult is occasionally the best thing ever… Then waiting some more……
Please, can I have the keys to my house now?
Do you know what happened to the girl who got everything she ever dreamed of? She lived happily ever after.