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When my husband and I were preparing to buy our first home, we were equal parts excited and overwhelmed thinking about what to do with all the space we would have.  Home gym? Yes. Home office? Yes. A gigantic deck for entertaining?! Yes.  Holding those keys in your hand is an amazing feeling and while it’s not a goal for everyone, it is still a very significant one for many people.  In that vein, I thought I would share my top 5 tips for navigating the sometimes murky process of buying a home:

1.  Have 25% of the purchase price saved in cash before you go shopping.

A 20% down payment will allow you to avoid Private Mortgage Insurance (PMI), and the discipline required to save enough cash for a “traditional” down payment is a great litmus test of your ability to meet the financial requirements of property upkeep for many years to come. There is a reason 20% was the standard before lenders came up with “clever financing tricks” to enable prospective buyers to put down less, and a reason why the bubble burst when we got all crafty with lending. Don’t fall for it, even though it’s still a thing lenders will try to sell you, and I think it should be illegal.  Another post for another day, maybe.

So a 20% down payment – got it.  But there’s more!  By the time we negotiated a reduced selling price, we still would have needed to bring 24% of the sale price to the table at closing, without any additional credits.Since those credits, in whatever form they take, are not a guarantee, it doesn’t make sense to shop for something you can’t afford straight up.You’ll just feel bad, or you’ll go broke and then you’ll feel bad.  But you’ll feel great if you stick to what you can really afford!

2.  Take advantage of free money.

First free money situation: 

Redfin offers a buyer credit based on the sale price of any house you buy.  This is literally free money and to my knowledge, no one else does this while still keeping your best interest in mind.  Redfin agents are salaried, so they have no incentive to coax you into buying a property that isn’t right for you (our realtor firmly told us to walk away from several properties, in fact).  So everyone use Redfin.  They aren’t paying me to write this, either! 

Second free money situation: 

We shopped around bigtime with lenders, and the rates totally vary from bank to bank.  Neglecting to shop around can cost you tens of thousands of dollars in interest over the life of your mortgage.  There was a minor incident where one unnamed lender enthusiastically announced to my husband that “your wife [who is listening to you on speakerphone, sir!] must be so happy to have hardwood floors on every level – it’ll be so much easier for her to clean now!” After I picked my jaw up off the floor, I vowed that we wouldn’t use that lender regardless of what their rates were.  Fortunately they were not the most competitive.  We ultimately went with Consumer Direct, and they have been excellent (they’re also not paying me – I’m just sharing what worked for us because we are freaks about research).

Third free money situation: 

We went through the home inspection process and uncovered a few things that would need to be addressed ideally quickly, and some “longer term” maintenance things to consider.  Is the A/C unit older? Yes. Is it the seller’s job to replace it for us when it still works great? No. We countered with a reasonable, justifiable seller assist request, which the sellers happily accepted, and the sale process proceeded on schedule.  My best advice is to not be an asshole.  In fact, go into this process as if the sellers are going to be your new neighbors … because in our case, they were! 

3.  Don’t settle for something “close enough” to what you want

When we started shopping for a home, my husband urgently required that we live on a lake.  Not just any body of water, but a lake where he could partake in water-based activities like SUP, kayaking and swimming.  It wasn’t as important to me to have that feature, so I was beyond enraged when he didn’t want to drop (way too much) cash on new construction next to a lake he couldn’t swim in.  I had my list of demands that I would not compromise on, but I’m embarrassed to say it hadn’t occurred to me that he also had a vision for his future home.  I was worried that because we weren’t after the same things in a house, we would never find something that worked for both of us.  When my husband refused to move forward with the house I’d designed, I furiously called off the whole search indefinitely (I’m only this dramatic approximately 3% of the time).

A few months later, we stumbled upon THE property that met all of our requirements (not just mine! Yay!).  If my husband hadn’t stuck to his vision, we would not have ended up with the property we did, and it is so much better than either of us could have imagined individually.  More than once we’ve reflected on how remarkable it is thatthere is room for both of us to have what we want … and so it is with the world.  My house search mantra was “It’s this or something better than this…” and I just kept saying it until I believed it.  Which conveniently brings me to my next point…

4.  Trust your instincts

I love to tell the story of how we found our house, because to me, it’s magical.  Our story begins with a furious and distraught Emily tearfully throwing away all of the design paperwork for the home she had crafted, in a community yet to be developed.  Yeah, I wanted to pay way too much money for a house that was pretty close to what I wanted but not quite, and I wanted it, like, yesterday.  I was also fine with living in a construction zone for three years apparently.  I could afford it, so why not, right? Not right.  So the search was called off after my tearful rampage and the hiatus lasted about six months.

One day, my instincts told me to go onto a real estate website out of the blue and there it was.  This beautiful house in a quiet neighborhood with all of the things I wanted, attached to a giant park with, you guessed it, a massive lake that you’re totally allowed to do water activities in and on.  Have at it, husband!  The property had just been listed.  I clicked through all of the pictures, drooling, then remembered my house shopping ban and shut it down.  A week later, this house kept popping into my head, so I suggested to my husband that we go check it out, just for fun.  I cannot stress enough that we had no intention of buying this, or any, house anytime soon.  We showed up, and we immediately loved it.  It had everything on both of our seemingly incongruous lists.  We knew that this was our house.  Within 48 hours we had finalized the sale and were off on the magical closing process journey.  This was made easier because we had already saved more than enough money to buy the house with 20% down and plenty of room to spare.   Just a year prior, that would not have been the case, so how did we accumulate so much so quickly?

5.  Buy a property as though you earn half of what you actually do.

Before you freak out and close the browser, hear me out.  That sounds like a very big deal if you’re used to spending the entirety of your income(s).  We had decided after we got married to transition to living on only one of our salaries, thinking it would be less disruptive should one of us choose to stay home with our future children if and when the time comes.  The entirety of the other’s salary would go into a savings account (after we maxed out our 401K contributions with our respective employers at the time), and we would “make it work” on one salary*.  If we had not done this when we did this, not only would we have in no way been able to afford the house that we bought (with no financial strain whatsoever, I might add), but we would have bloated expectations of what our lifestyle should be like in general. 

When we max everything out to try to chase a lifestyle that isn’t congruent with our values, we all know where that road leads … frustration, detachment, burnout, and eventually total crisis.  I want much more for you than those things!  I want you to learn to earn more and spend less.  My coaching centers on maximizing your money, your time and your energy.  That does not mean maximizing your spending, your calendar commitments and your exertion in every activity.  It’s the opposite.  Maximize the potential of your resources and use them intentionally, and you will be able to optimize your happiness. 

We’re paying off our mortgage at breakneck speed, and you cannot do this if you are spending a stupid amount of money on things that aren’t actually enhancing your lifestyle in a meaningful way.  Trust me, I’ve tried.  And there is no better feeling than knowing I can have complete and utter financial independence, in my dream home, next to my husband’s dream lake with his dream paddleboard in our dream garage, in a fraction of the time most people assume it takes. 

Live abundantly!