Buying a Home Military Style, Pt. 1

“Let’s buy a house,” my husband said.

“It will be fun,” he said.

“It will be like we’re really adults and it will be good for the boys,” he said.

“OK, but how?” I responded.

I was also thinking, “And this means I can’t just call maintenance when I need something. And we will move again, so will we make money or lose money on this investment? And why should we start acting like adults now, in our 40’s?”

Of all the decisions you make when you move in the military, deciding where to live may be the biggest one. While a lot of factors always come into play, for this particular move we decided that being in our 40’s and having teenagers might be a good time to invest in a home. We hoped to stay in Kansas for four or more years.  We weren’t just flipping a house. We hoped to invest a little sweat equity.

But the big question was, “How?”

It’s Easy as 1-2-3

When Denise asked if I could write about how to buy a house I thought, “I remember looking at houses with a realtor, putting the offer in, talking to a lot of people and signing a lot of papers and then we were declared homeowners.”

I didn’t remember the actual steps. There were several.  A sense of overwhelm also came rushing back into my mind.

Then a great thing happened. I remembered that I knew a lot of people. So, I talked to my neighbor, friend and fellow Army wife who also just happens to be a realtor, Kayla Jordan with Coldwell Banker Real Estate Advisors located in Manhattan, Kansas.

Kayla walked me through the process step-by-step and answered so many questions!

First, understand there are several steps that each take some time to get through when buying a house. Have you ever gone to the car dealership and just prayed that you would be out of there in two hours or less with just the right car? This takes a lot longer, weeks longer, so buckle up!

If you are serious about buying a house there are seven basic steps. Plan on the whole process taking about three months.

1.     Get pre-approved for a home loan. You might not end up with USAA, but as military, it is a great place to start.

2.     Secure your realtor.

3.     Shop around.

4.     Find the home.

5.     Make the offer, get it accepted and sign a contract.

6.     Get home inspections while the lender does the appraisal and underwriting.

7.     CLOSE! You own the home!

That’s it! You’ve bought a house.

You still have questions. That’s ok, Kayla made everything sound so simple. I guess that’s her job!

Filling in the Details 

First, call USAA and/or another lender to get an initial pre-approval for a home loan. Get three pre-approvals so you know what houses are within your budget. You don’t have to stay with these lenders but it gives you a starting point.

It’s important to shop for a lender within a short window of time so you don’t get a big credit hit. Usually, credit hits come with looking up your credit score. If the banks do so in a short window, that is considered one credit check and does not significantly damage your credit score.

Once pre-approved for a home loan, you are ready to secure a realtor. Interview a few different people. Make sure you are compatible. You want someone who will listen to you and show you the homes you want to see within your price range.

Additionally, as a military family, you will want to have a realtor who is knowledgeable about VA loans if this is something you are considering (which you should if this is a primary home). Realtors near military installations are usually familiar with these loan regulations, but you want to make sure so they don’t show you something the VA loan assessor won’t approve. Hint: A VA loan assessor will not approve “fixer-uppers”. The house needs to be in good repair and move-in ready, though it may need some updating to suit your tastes.

Your realtor should also be knowledgeable about any local or state laws that might impact your bottom line. Our area has something called “specials.” There are extra taxes on brand new homes, so even if the sticker price on a new home is the same as the 15-year-old house across the street, you will pay more taxes because of the “specials”.

Another consideration when selecting a realtor is that some banks offer different incentives based on location. For instance, in Kansas the Navy Federal Credit Union (NFCU) has a loyalty program that offers a cash back incentive. If you start with NFCU, they will connect you to a realtor who is approved for this program. (Kayla is!)

Once you’ve found your person, you will have to sign some paperwork called an “agency agreement” prior to viewing homes.

The next three things kinda happen at the same time. After you secure a realtor and are closer to making an offer, Kayla suggests you shop around for the best mortgage available to you.  This might be the lender who pre-approved you earlier or it might be a new lender.

This sounds redundant, but you will want to listen to your realtor’s suggestions of where their previous clients have been successful in getting great rates on Veterans Affairs (VA) home loans. We did listen to our realtor who recommended a local bank. It turns out neither USAA nor Navy Federal Credit Union could beat the local bank’s rate.

The PCS Timeline vs Home Buying Timeline

Since closing takes about 30 – 45 days with a VA loan and you must occupy your home within 60 days of closing, it is ideal to start your home search three months out from your move date.

If you know well before the three months that you are PCSing and want to buy, you can use the time to learn about the area. Visit Facebook spouses’ groups for the receiving duty station, check out the “Nextdoor” app and school ratings apps.  Additionally, research what the sheriff’s department has to say about crime statistics in the area and join local non-military Facebook groups. Finally, Youtube has highlight reels for some areas so you can see what the locals are saying about your new town.

If you want to see what kind of home inventory is available in your new town, check out Zillow, Trulia and realtor.com. However, the prices given are often estimates based on their own algorithm, not the actual list price. So be aware that your realtor might give you different information about those houses once you hire her.

For this move we were in New York and we wanted to buy a house in Kansas. We had a choice to either visit ahead of time, buy virtually, or rent a home for three to six months or one year while we looked for a permanent home once we got there.

While some people have had success with virtual tours, I have a friend who is going through a nightmare situation with a home she didn’t enter prior to closing. Even though she saw it on the video, she didn’t smell it and couldn’t see some things she may have caught by being there. It turns out it smelled like cigarette smoke and had some water damage.

Some people don’t mind moving twice or living in limbo in an intermediate living situation while looking around. That didn’t suit us because we didn’t want to buy a house while Tim was deployed, something we knew would happen shortly after our move.

Another option is sending the service member ahead of the family and to the house search before the family arrives. Prior the convenience of the internet, when my Dad was in the Navy during the 1970’s and 80’s, he would sign into the receiving unit and look for houses while we hung behind at least four times. We would finish school and get packed for the move.

My Dad would consider all the things he and my mom agreed were important: schools, budget, yard, and whatever else rose to the top of the requirements for them. He narrowed the choices down to two or three and in 15 minutes or less, describe them to my mom over the phone so she could make the final decision. My mom didn’t see the houses they bought in advance of their moves for 27 years with one exception that was a local move. That’s four out of five of their homes purchased during their military years that my parents bought in this way. It must have worked, because they are still married after 60 years!

Join us next week when Ande walks us through the remaining steps to buying a home.