Today was the settlement. We used the NVR settlement company (which NVR mortgage choose for us, but I think we could have requested someone else). Settlement took forever because they weren't quite ready for us. We waited around for 30 minutes before they had our paperwork. There is a large stack of papers to sign. The settlement guy in there with us was happy to explain any of the documents we were signing, wait patiently while we read anything we wanted. I had mixed feeling about reading all of the documents, on one hand it is good to know what you are signing, but on the other hand if you didn't agree with something you have no negotiation power to do anything about it. Plus these same forms are being signed by thousands of other people. I did a speed read of all the documents, I wanted to roughly know what was going. It took about 2.5 hours to sign everything. But at the end they handed over the keys and we were on our way.
We obviously went straight to our new home. There we found a welcome basket from Ryan Homes. There isn't much advice to give for this stage of the process so this post will be short. I'll just say make sure that the sprinklers are watering the new sod often. New sod needs lots of water.
Tuesday, May 29, 2012
Monday, May 28, 2012
Pre Settlement Inspection
Today I met my home inspector and did my pre-settelment walk through with him. As I have mentioned in other posts it is important to have a home inspector take a look at your new house as it is for them to look at old houses. My inspector told me about how he was looking at a deck on a new house and found one of the footings cracked completely through, it was just a matter of time before it broke apart completely. The whole inspection took about two hours (although I hear it varies quite a bit). I scheduled it for the day before my walk through with the project manager (which is tomorrow), that way we didn't need to rush. The cleaning crew was also there making sure it looked clean for settlement.
I walked around with my home inspector and some of the things we examined were:
I emailed the list to my project manager and I will see him tomorrow and we can go over the list and he can do his walk through.
The outside of the house with the new sod.
I walked around with my home inspector and some of the things we examined were:
- We turned the AC on and measured the temp of the air coming out of the vents (he had a meat thermomitor looking thing to do this) and then turned the heat on and did the same. It looked good.
- We ran all of the appliances in the kitchen and made sure they worked and that if everything on the stove (all the burners and oven) was on the breaker didn't trip.
- We opened up the furnace down stairs and ensured the proper filters were there. He also found that the safety switch for the furnace cover was taped down which wasn't good. It is designed to turn off if the furnace cover is open so you (or your kids) can't electrocute yourself.
- Checked the toilets, he found one that had a slow leak, wasting water.
- He checked that all the breakers work as they were supposed to.
- He checked the sump pump.
- He checked the GFCI outlets.
- He also found a couple scratches on the cabinets and mirrors.
- He checked every window making sure it was sealed well, opened and closed well. One window was a bit tight.
- We walked around the outside, he made sure the spigots worked well, found a piecie of siding that wasn't tucked in as it should.
- There were end caps missing off the molding near the garage door.
- He checked that garage door and the safety features of the garage all worked as they were supposed to.
He checked a gazillion other things as well, but this was some of the stuff that we checked and found wrong. In the end I had a list of about 12 things to give to the project manager that we wanted fixed.
The inspection was about $200, and considering how small that is compared to the home I think it is worth it. He also found problems that if I hadn't found on my own would have cost more than $200 to fix. He just knew to look for things that I wouldn't have looked at.
I emailed the list to my project manager and I will see him tomorrow and we can go over the list and he can do his walk through.
Our kitchen
Monday, May 7, 2012
Walk through to look at cabinets and stuff
We are a few weeks away from closing on the house. Today we had a walk through where we verified that some of the selections we made are correct. The project manager couldn't make it so the assistant project manager met us.
All the drywall is up and the house is very close to being finished. We checked out the kitchen cabinets and marble counter top. We also checked out the bathroom tiles. The flooring (carpet and such) was not in yet (I don't know if that is normal). All of this took a total of 15 minutes at most. Afterwards he let us roam around and look at the whole house. We measured some of the windows and locations for appliances (Fridge, washer, dryer and stuff like that). We didn't get any additional appliances from Ryan Homes and plan on replacing the basic stove, vent and dish washer that comes with the house so this was a good chance to get measurements because we'll buy the appliances before we settle.
Not much else to say. The only point of this meeting was to verify some of the selections so if they made a mistake they had time to fix it.
All the drywall is up and the house is very close to being finished. We checked out the kitchen cabinets and marble counter top. We also checked out the bathroom tiles. The flooring (carpet and such) was not in yet (I don't know if that is normal). All of this took a total of 15 minutes at most. Afterwards he let us roam around and look at the whole house. We measured some of the windows and locations for appliances (Fridge, washer, dryer and stuff like that). We didn't get any additional appliances from Ryan Homes and plan on replacing the basic stove, vent and dish washer that comes with the house so this was a good chance to get measurements because we'll buy the appliances before we settle.
Not much else to say. The only point of this meeting was to verify some of the selections so if they made a mistake they had time to fix it.
Saturday, April 21, 2012
Just a quick update and a picture
There hasn't been much to talk about lately. With the pre-drywall behind us we wait awhile until a quick walk through to just verify a few things like cabinet type/color, counter tops and stuff.
Here is the outside of the house. As you can see we are a corner lot. I like it because we have a large side yard on the south side of the house which will get a lot of son. We also got half siding and half brick on the front. This looks stupid on some houses/elevations because brick suddenly turns in to siding. With the Rome (Elevation C) there is that part that sticks out in the middle of the second floor. This is nice because it made that bedroom bigger (or the loft area if you don't enclose it) and it makes it so the brick just doesn't turn in to siding in the middle of the house. Look around the community you'll probably see what I mean. I also thought the brick would wrap around the house for about a foot, it does on some of the other homes, I don't know why it doesn't on ours.
Here is the outside of the house. As you can see we are a corner lot. I like it because we have a large side yard on the south side of the house which will get a lot of son. We also got half siding and half brick on the front. This looks stupid on some houses/elevations because brick suddenly turns in to siding. With the Rome (Elevation C) there is that part that sticks out in the middle of the second floor. This is nice because it made that bedroom bigger (or the loft area if you don't enclose it) and it makes it so the brick just doesn't turn in to siding in the middle of the house. Look around the community you'll probably see what I mean. I also thought the brick would wrap around the house for about a foot, it does on some of the other homes, I don't know why it doesn't on ours.
Monday, April 16, 2012
Pre-Drywall followup
I showed my wife the pictures of the house and she loved seeing them. She couldn't make it to the meeting with the project manager. It's really interesting to see your house in this state. I still think the pictures will come in handy down the road when I am doing some home improvement projects.
I stopped by and took a look at the house to make sure the stuff that was supposed to get fixed got fixed. It looked good, but I caught one more thing, a stud without a nail protector. I emailed the project manager about it.
One thing I do wish I had done was adding a second outlet to the garage, there is only one (technically two, one on the ceiling for the garage door opener). I can always add an outlet if I want down the road myself, but it will be a little bit of a hassle since it is an outside wall I would have wanted it on.
I don't think I'll have much to post on except pictures of the progress for awhile.
I stopped by and took a look at the house to make sure the stuff that was supposed to get fixed got fixed. It looked good, but I caught one more thing, a stud without a nail protector. I emailed the project manager about it.
One thing I do wish I had done was adding a second outlet to the garage, there is only one (technically two, one on the ceiling for the garage door opener). I can always add an outlet if I want down the road myself, but it will be a little bit of a hassle since it is an outside wall I would have wanted it on.
I don't think I'll have much to post on except pictures of the progress for awhile.
Thursday, April 12, 2012
Pre-drywall with the project manager
My previous post talked about my pre-drywall inspection with my home inspector. This post is about my walk through with my project manager and the types of things that were done.
The project manager will show you some of the features of the home, but I learned more from my home inspector than I did with my project manager. We started by going room to room. One of the big items that is done here is verify that the options selected are all correct (at least the ones installed). This includes fireplaces, light fixtures, ceiling fan mounts, extra outlets, low voltage cables for TV, Internet and phone. Almost all these you should check that you like there position. I asked them to move a ceiling fan mount since it was centered in the room, but since there was a bulk-head in the room it wasn't centered on the ceiling, so it looked funny. (I'll include a picture once we have the house finished and the ceiling fan is put in). I also had a wall mount phone outlet, but I felt it was too low so I asked him to move it up. Both of these things was no problem for him. You should also look to see if you want any of these moved.
As we went around I also pointed out things that my home inspector made notes about. My project manager pushed back on fixing some of them (there was a stud that I thought bowed too much) but in the end agreed to fix them, mostly to get me to shut up. In this case the squeaky wheel gets the grease.
The whole meeting took about 2 hours, after wards he let me stay in the home to take pictures. Taking pictures at this stage will be very valuable later. I now have pictures of where all the pipes, power lines, sprinkler lines, and duct work inside the walls. If I want to renovate something later this will be valuable. You are not given any paper plans (Ryan will tell you there are proprietary) so this is your only way to know what is where, plus paper plans can be different that what is done. I also took a lot of video of me slowly scanning the room, I think these will be valuable because you can get a better perspective of the room. When taking pictures, remember to try to get landmarks in the photo, things you will see when the house is finished like windows, doors, outlets (you'll have to make a note of what outlet it is because they all look the same). This will let you know where exactly in the house the picture was taken. Trust me when looking through walls it all looks the same. Post it notes are also nice, you can label things and then take a picture of it so you have a note of what you took a picture of in your picture. These are just my 2 cents.
Lastly, I asked the project manager when I could come back and see that things were fixed. He told me I can come back in 3 days and everything would be done. This way I know that things actually got fixed, instead of just being told they did. Remember that the project manager works for Ryan, not you so he doesn't have your best interests in mind.
The project manager will show you some of the features of the home, but I learned more from my home inspector than I did with my project manager. We started by going room to room. One of the big items that is done here is verify that the options selected are all correct (at least the ones installed). This includes fireplaces, light fixtures, ceiling fan mounts, extra outlets, low voltage cables for TV, Internet and phone. Almost all these you should check that you like there position. I asked them to move a ceiling fan mount since it was centered in the room, but since there was a bulk-head in the room it wasn't centered on the ceiling, so it looked funny. (I'll include a picture once we have the house finished and the ceiling fan is put in). I also had a wall mount phone outlet, but I felt it was too low so I asked him to move it up. Both of these things was no problem for him. You should also look to see if you want any of these moved.
As we went around I also pointed out things that my home inspector made notes about. My project manager pushed back on fixing some of them (there was a stud that I thought bowed too much) but in the end agreed to fix them, mostly to get me to shut up. In this case the squeaky wheel gets the grease.
The whole meeting took about 2 hours, after wards he let me stay in the home to take pictures. Taking pictures at this stage will be very valuable later. I now have pictures of where all the pipes, power lines, sprinkler lines, and duct work inside the walls. If I want to renovate something later this will be valuable. You are not given any paper plans (Ryan will tell you there are proprietary) so this is your only way to know what is where, plus paper plans can be different that what is done. I also took a lot of video of me slowly scanning the room, I think these will be valuable because you can get a better perspective of the room. When taking pictures, remember to try to get landmarks in the photo, things you will see when the house is finished like windows, doors, outlets (you'll have to make a note of what outlet it is because they all look the same). This will let you know where exactly in the house the picture was taken. Trust me when looking through walls it all looks the same. Post it notes are also nice, you can label things and then take a picture of it so you have a note of what you took a picture of in your picture. These are just my 2 cents.
Lastly, I asked the project manager when I could come back and see that things were fixed. He told me I can come back in 3 days and everything would be done. This way I know that things actually got fixed, instead of just being told they did. Remember that the project manager works for Ryan, not you so he doesn't have your best interests in mind.
Wednesday, April 11, 2012
I had my pre-drywall inspection today. First I had my home inspector come out and give it a look over, then the project manager came and we went through it together with me pointing out things the home inspector pointed out to me. We had about a dozen things to fix, but all were small stuff that didn't make me question the quality of the home. I am going to break this in to two posts, thus one about my home inspector walk through, and the next one how it went with the project manager.
My home inspector came in the morning and we walked through the house together. I had the option of letting him do it himself; however, I would recommend against that for two reasons, you'll learn a lot about your house by watching and listening to him, and you'll need to know what things need fixed so you can tell your project manager. Being there in person will help with that.
We started by walking around the outside of the house. We found a couple spots in the housing wrap that needed patching, around a window and vent. We then went inside. We spent 15 to 20 minutes in every room just looking at everything carefully. He spent a lot of time showing me things and explaining why they do cretin things, so I learned a lot about the home. We found some studs that needed nail plates to protect the wires running through them. Some of the steal beams running through the house were missing bolts or had nuts that needed tightening. We checked that there was foam insulation behind all outlets, which is required for energy star rating. Overall we probably found a dozen things that needed to be fixed. Nothing was detrimental but having them fixed decreased the likelihood of problems down the road.
Even though we didn't find any major problems I still recommend a home inspector at this stage, the reason is that there is a chance something major is wrong. If there is a problem and the project manager didn't catch it chances are you have no chance of catching it. A home inspector will most likely find any problems, plus compared to the cost of your house having a home inspection is cheap. I think the people that are posting horror stories about building a home on the internet would probably have been saved if they had hired a home inspector.
My home inspector came in the morning and we walked through the house together. I had the option of letting him do it himself; however, I would recommend against that for two reasons, you'll learn a lot about your house by watching and listening to him, and you'll need to know what things need fixed so you can tell your project manager. Being there in person will help with that.
We started by walking around the outside of the house. We found a couple spots in the housing wrap that needed patching, around a window and vent. We then went inside. We spent 15 to 20 minutes in every room just looking at everything carefully. He spent a lot of time showing me things and explaining why they do cretin things, so I learned a lot about the home. We found some studs that needed nail plates to protect the wires running through them. Some of the steal beams running through the house were missing bolts or had nuts that needed tightening. We checked that there was foam insulation behind all outlets, which is required for energy star rating. Overall we probably found a dozen things that needed to be fixed. Nothing was detrimental but having them fixed decreased the likelihood of problems down the road.
Even though we didn't find any major problems I still recommend a home inspector at this stage, the reason is that there is a chance something major is wrong. If there is a problem and the project manager didn't catch it chances are you have no chance of catching it. A home inspector will most likely find any problems, plus compared to the cost of your house having a home inspection is cheap. I think the people that are posting horror stories about building a home on the internet would probably have been saved if they had hired a home inspector.
Sunday, April 1, 2012
Monday, March 19, 2012
Pre-backfill inspection
Today I had my home inspector come out and do a pre-backfill inspection. This is a chance to inspect the foundation from both sides and a lot of the plumbing that you cannot see that is either under the concrete slab that they pour in the basement (the inspection is done before this is poured) and the plumbing that goes around the foundation. This is all stuff that you never see in homes because it is buried and completely inaccessible, so this is the one chance to see it. I paid $175 for the inspection which took about one hour.
Overall things looked really great. It seems that my project manager took great care to make sure that all looks good, and my home inspector gave it a thumbs up. Know that everything is good gives me a lot of peace and mind and I would recommend getting a home inspector for the pre-backfill (my project manager acted like it was not needed). I have heard stories of crazy things that home inspectors find during these inspections and you don't want your home to be the one that has that pipe that can't drain because it is going up-hill. I also learned a lot (from the home inspector, the project manager was not there) during the process which is why I would advocate you being there for it. I learned that a poured concrete foundation (which Ryan homes did) is far superior to cinder block, you will basically never have moisture problems with poured concrete like you will with cinder blocks. Whoever you build with you should ask them if they use poured concrete or cinder blocks for the foundation. I now understand where all those pipes that will eventually just run down in to concrete run to and what they are used for.
It was also nice to see how our house fit on the property and finally see what our backyard looks like. It is a bit on the small side; however, it is mostly because my wife and I are used to the large (and flat) backyards of the Midwest. Overall things are going on quite well and we are happy with the progress.
Friday, March 16, 2012
Siding follow up and more
It has been a over a week since we went out to check on the sidings, but I haven't got the time ot talk about it until now. My wife and I went out and looked at the house that has Autumn Beige siding, and yes I think it is a bit pink. In fact my wife always thought that house was pinkish and didn't realize that was the color we chose! We looked at the other choices and for a darker gray we like, but there was a problem. Ryan homes has very specific choices of door color and shutter colors that you can choose from with each siding. With the color we chose (mountainstone clay) we couldn't get the shutters and the door to be the same color unless they were both green! My wife kept was very vocal about how stupid that was to the Ryan rep. We decided to drive around the neighbor hood and look for a different siding color that we liked or decide on what color we wanted our shutters and door to mismatch. As it turns out every homeowner in the community choose a pattern that had the door and shutters the same color, so it wasn't just us that thought it would look silly to have them mismatch.
While we were out driving around the rep called her supervisor and asked about letting us have both the doors and shutters painted black like we would have wanted. Typically they can't/won't do this, but I think that since they were playing damage control with the autumn beige thing and my wife was vocal enough the supervisor told our rep that we could get both black. This shows that Ryan can bend the rules a little when they want, but I think my wife being vocal about how the situation stunk a whole bunch helped.
In other news they finally started digging. A two week delay in getting the permits. My wife and I saw the hole in the dirt last weekend. They were going to start the foundation on Monday, but the workers were a no show so they started late, but they got going now. I'll do a pre-backfill inspection with my home inspector next week. I should be able to see the foundation this weekend when my wife and I go over to look at the place. This will give us a chance to see how the house fits on the lot for the first time. It is a big house and not a huge lot so this will give us an idea of how big our back yard will be. Of course we saw all the dimensions on paper, but seeing it in real life will put a perspective on it.
While we were out driving around the rep called her supervisor and asked about letting us have both the doors and shutters painted black like we would have wanted. Typically they can't/won't do this, but I think that since they were playing damage control with the autumn beige thing and my wife was vocal enough the supervisor told our rep that we could get both black. This shows that Ryan can bend the rules a little when they want, but I think my wife being vocal about how the situation stunk a whole bunch helped.
In other news they finally started digging. A two week delay in getting the permits. My wife and I saw the hole in the dirt last weekend. They were going to start the foundation on Monday, but the workers were a no show so they started late, but they got going now. I'll do a pre-backfill inspection with my home inspector next week. I should be able to see the foundation this weekend when my wife and I go over to look at the place. This will give us a chance to see how the house fits on the lot for the first time. It is a big house and not a huge lot so this will give us an idea of how big our back yard will be. Of course we saw all the dimensions on paper, but seeing it in real life will put a perspective on it.
Thursday, March 1, 2012
Pink siding?
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| Not our house, but one with the same siding color as we chose. I can see some pink in it. |
Monday, February 27, 2012
Pre construction meeting
Once I am done with this post I'll be caught up with writing about the start of the process of buying our Ryan home and will begin to write about things as they happen. I want you to know that all the posts up to this point actually happened in a short period of a few weeks despite the dates on the post.
The pre-construction meeting was the first time that my wife and I met the construction manager for our home. Our rep that has been dealing with us so far was also there. Most of the meeting with the construction manager was about what he does, so I thought I would start there. He is in charge of lining up and scheduling all the contractors that will build our house. Ryan homes hires local contractors to do all the work on building the homes. He is in the home about once every day to see how things are going and to make sure the work is being done. He is also our point of contact if we have any construction questions, like when should I have the home inspector go out there for a pre-backfill inspection. The sales rep is also still there if we have any questions as well.
One thing that became clear at this meeting (that I think I was misled about earlier) is how difficult it is to walk through your house to take a look at it prior to settlement. As I mentioned in an earlier post I asked the sales rep if I can walk through the house to make sure things were being done right on a regular basis (I think I even told her once a week). She said that was doable and to just call the construction manager before hand so he can tell me if there is any dangers on the site. I found out at this meeting that if I wanted to walk through the house the construction manager needs to be there. I can call and make an appointment, as long as he has time available, but he indicated he is typically very busy. The outcome of this is that I don't think I will be able to see the house except at the predefined walk through. I am kind of disappointed in being misled like this; however, thinking about it afterwards I realized that I wouldn't even know what to look for if I was to walk through the house to make sure things looked fine. As a result I am a little less upset about it now because I don't think I would benefit from walking through the house once or twice a week, but I was still misled so I plan to that down on the post-settlement survey. But this leads to another very important topic, hiring a home inspector. As I mentioned before the construction manager works for Ryan homes and he has dead lines to meet so he receives raises/bonus. He is over seeing people that were the lowest bidder to build your house, and he is also over seeing maybe a dozen other houses at the same time. Don't rely on him to spot mistakes, or even to fix them if he does spot them, the one person he does not work for or have loyalty to is you. As I just mentioned I have no experience with building a house so I found a home inspector to by on my side to make sure things look right. I asked around and found a home inspector that my coworkers raved about. This home inspector will do a pre-backfill, pre-drywall, and pre-settlement inspection for me. I think it is very important to have someone on my side to make sure the house is as it is supposed to be.
I asked the construction manager how scheduling my home inspector works. I sounds like I just need to let him know what day and time my home inspector will be out there. I am also allowed to come with the inspector if I can get off work. One thing to note is they won't pause construction for any inspections. My inspector told me that I need to be very active on keeping track of the construction schedule and to schedule something about a week out which is his normal availability. I am already emailing my construction manager about pre-backfill so I know when to have the home inspector come out.
At the pre-construction meeting we also went over the final selection of upgrades and selections. We also saw an updated plat with our house on it. Everything looked as expected. Needles to say my wife and I are getting excitied.
The pre-construction meeting was the first time that my wife and I met the construction manager for our home. Our rep that has been dealing with us so far was also there. Most of the meeting with the construction manager was about what he does, so I thought I would start there. He is in charge of lining up and scheduling all the contractors that will build our house. Ryan homes hires local contractors to do all the work on building the homes. He is in the home about once every day to see how things are going and to make sure the work is being done. He is also our point of contact if we have any construction questions, like when should I have the home inspector go out there for a pre-backfill inspection. The sales rep is also still there if we have any questions as well.
One thing that became clear at this meeting (that I think I was misled about earlier) is how difficult it is to walk through your house to take a look at it prior to settlement. As I mentioned in an earlier post I asked the sales rep if I can walk through the house to make sure things were being done right on a regular basis (I think I even told her once a week). She said that was doable and to just call the construction manager before hand so he can tell me if there is any dangers on the site. I found out at this meeting that if I wanted to walk through the house the construction manager needs to be there. I can call and make an appointment, as long as he has time available, but he indicated he is typically very busy. The outcome of this is that I don't think I will be able to see the house except at the predefined walk through. I am kind of disappointed in being misled like this; however, thinking about it afterwards I realized that I wouldn't even know what to look for if I was to walk through the house to make sure things looked fine. As a result I am a little less upset about it now because I don't think I would benefit from walking through the house once or twice a week, but I was still misled so I plan to that down on the post-settlement survey. But this leads to another very important topic, hiring a home inspector. As I mentioned before the construction manager works for Ryan homes and he has dead lines to meet so he receives raises/bonus. He is over seeing people that were the lowest bidder to build your house, and he is also over seeing maybe a dozen other houses at the same time. Don't rely on him to spot mistakes, or even to fix them if he does spot them, the one person he does not work for or have loyalty to is you. As I just mentioned I have no experience with building a house so I found a home inspector to by on my side to make sure things look right. I asked around and found a home inspector that my coworkers raved about. This home inspector will do a pre-backfill, pre-drywall, and pre-settlement inspection for me. I think it is very important to have someone on my side to make sure the house is as it is supposed to be.
I asked the construction manager how scheduling my home inspector works. I sounds like I just need to let him know what day and time my home inspector will be out there. I am also allowed to come with the inspector if I can get off work. One thing to note is they won't pause construction for any inspections. My inspector told me that I need to be very active on keeping track of the construction schedule and to schedule something about a week out which is his normal availability. I am already emailing my construction manager about pre-backfill so I know when to have the home inspector come out.
At the pre-construction meeting we also went over the final selection of upgrades and selections. We also saw an updated plat with our house on it. Everything looked as expected. Needles to say my wife and I are getting excitied.
Monday, February 20, 2012
Meeting with the flooring people
You need to meet with two companies in the first 30 days (besides your mortgage people). The first was guardian for you low voltage wiring which I talked about in my last post. The second (you can meet with them in any order) is the flooring people to choose carpet, tiles, wood flooring and anything else.
The company that was doing our flooring is Stonemark Flooring, and I have to say that the whole process of dealing with them has been horrible. When at their show room it was like pulling teeth to get the price for particular upgrades. I asked if I could just see the list in writing and our associate, Rebecca, would say I don't really have an official list that she could print off, they were all on the computer. SO I kept asking for various upgrades and she would sigh every time before telling me the price for the upgrade. Then finding out what selections were part of that upgrade was also difficult. For example upgrade 6 was below upgrade 1 on the shelf, and when I would ask where upgrade 1 was she would waive vaguely at the shelf making it difficult to know where one upgrade started and one ended. They also lacked knowledge about their product. I would ask what the carpet density or number of twists were for a sample and she would say it was on the back but out of all the samples I picked up only one had it on the back. When I continued to ask she told me that the manufacture didn't tell them what it was. If you have ever bought carpet you will know that these two qualities of a carpet is what tells you the quality of the carpet and all carpets have them listed. I ended up having to compare the wieght of carpets and try to count the twists myself. Stonemake flooring was useless when it came to providing product information.
Either they were very bad at their job, didn't care because they knew I had to do business with them, or are trying to deceive me by providing a lower grade carpet. I feel completely cheated by the process of dealing with them that I plan to ask my Ryan Rep for the are manager so I can tell them my experience and how I felt that they are trying to deceive me. I'll let you know how it goes.
I know I have gone on and on about certain upgrades being very over priced, but it seems to be very true for the carpet too. For example they were charging what came out to be $8.00 per square yard for the upgraded pad. $23 per square yard for a middle of the line carpet. It seems that you will do better off if you can upgrade your carpet after you settle if you don't need to roll it in to the mortgage. Pluss you can select from more brands. Just so you know the base line carpet is of the same level an apartment would have.
One last thing, they did this demonstration on the stain resistance of the carpet. They put two carpet samples in a container of cool-aid. When they pulled it out they showed how the carpet without stain guard didn't get dyed. The problem is they waited until my back was turned to set the demonstration up. I would have wanted to see what the carpet looked like before they put it in the cool-aid. Maybe others can comment on if they saw the demonstration set up or did they wait until your back was turned? I have read that stain guard carpet is well worth the money, but as a scientist not seeing the carpet before the cool-aid made the demonstration useless to me.
The company that was doing our flooring is Stonemark Flooring, and I have to say that the whole process of dealing with them has been horrible. When at their show room it was like pulling teeth to get the price for particular upgrades. I asked if I could just see the list in writing and our associate, Rebecca, would say I don't really have an official list that she could print off, they were all on the computer. SO I kept asking for various upgrades and she would sigh every time before telling me the price for the upgrade. Then finding out what selections were part of that upgrade was also difficult. For example upgrade 6 was below upgrade 1 on the shelf, and when I would ask where upgrade 1 was she would waive vaguely at the shelf making it difficult to know where one upgrade started and one ended. They also lacked knowledge about their product. I would ask what the carpet density or number of twists were for a sample and she would say it was on the back but out of all the samples I picked up only one had it on the back. When I continued to ask she told me that the manufacture didn't tell them what it was. If you have ever bought carpet you will know that these two qualities of a carpet is what tells you the quality of the carpet and all carpets have them listed. I ended up having to compare the wieght of carpets and try to count the twists myself. Stonemake flooring was useless when it came to providing product information.
Either they were very bad at their job, didn't care because they knew I had to do business with them, or are trying to deceive me by providing a lower grade carpet. I feel completely cheated by the process of dealing with them that I plan to ask my Ryan Rep for the are manager so I can tell them my experience and how I felt that they are trying to deceive me. I'll let you know how it goes.
I know I have gone on and on about certain upgrades being very over priced, but it seems to be very true for the carpet too. For example they were charging what came out to be $8.00 per square yard for the upgraded pad. $23 per square yard for a middle of the line carpet. It seems that you will do better off if you can upgrade your carpet after you settle if you don't need to roll it in to the mortgage. Pluss you can select from more brands. Just so you know the base line carpet is of the same level an apartment would have.
One last thing, they did this demonstration on the stain resistance of the carpet. They put two carpet samples in a container of cool-aid. When they pulled it out they showed how the carpet without stain guard didn't get dyed. The problem is they waited until my back was turned to set the demonstration up. I would have wanted to see what the carpet looked like before they put it in the cool-aid. Maybe others can comment on if they saw the demonstration set up or did they wait until your back was turned? I have read that stain guard carpet is well worth the money, but as a scientist not seeing the carpet before the cool-aid made the demonstration useless to me.
Meeting with Guardian people
I met with the Guardian people the other day (I am still trying to catch up on blogging about the whole experience, so it was really over a week ago). Guardian s the company that will install the low voltage wiring in the walls of your house. For those of you who don't know, low voltage wiring is all the wiring for phone, internet, cable tc, in-wall speakers, alarm systems, in-wall video cables. They also offer a central vacuum setup.
The home comes with two phone jacks, and two cable jacks. The phone jacks have to be in the kitchen and master bedroom. The cable jacks have to be in the family room and master bedroom. If you want them elsewhere you should ask, but there is no guarantee that they will do it. You should know that they use Cat5 cable for the phone lines too, and the jacks they use accept both phone and Ethernet plugs, so if you don't plan on having a home phone system these can still be used for internet. They were charging me $95 per additional phone, Ethernet or phone line that they put in. This is something you can do your self after you move in but it involves cutting drywall and patching it up. If you plan on painting the place this isn't so bad since you will paint the patches. Even if you don't plan on painting you can paint the patches you make with the same color paint they have. It is difficult to run a line between floors, so I asked them to run a cable line and two cat5 lines (one can be used for phone) up to the attic. This way I can split the cables from there and easily run them in to each bedroom, I think this was worth the $285.
They also hang a tv up for you and run lines behind the wall to the cable box\blu ray player. The price for this seemed a bit high, and if you have a little DIY skills you can also do this yourself with little trouble. What I didn't like about this service is they run a specific number of cables, I believe it was one HDMI and one set of component cables. If you have more than two devices, or need two HDMI cables you will be out of luck, so think ahead.
They also offer features such as whole house audio, setting up in wall speakers. Agian, these are things you could do later (and better) if you have the know how for less. The research I did showed that these things add very little value to your house, so you won't make the money back when you sell the house; however, if it is something you want and don't know how to do it your self it may be worth having guardian do it.
Guardians big thing is the alarm system. They want to put a wired alarm system in to your house for little cost and then have you committed to paying for their alarm service for 3 years. This is what they will spend the most time selling you on. My wife and I wanted an alarm system so we looked at what we got for free plus what we would want to add on. We only got one control panel, sensors on the doors to the house, and a motion detector for free. To get sensors on the first floor windows, another control panel and a smoke detector would have been many hundreds of dollars. As a comparison we could get a wireless system with ATK for $100 installed that had everything we wanted (ATKs package came with more free stuff if you sign a 3 year contract). The monthly cost was $2 cheaper per month with ATK. ATK also had the ability to monitor your home from your cell phone, a feature Guardian's wired package currently does not (but it is in the works). The guardian rep tried to sell me on the idea of a wired system. It has a couple of advantages, you don't have to replace batteries (ATK does monitor the batteries in all your devices and will call you when one gets low so you know to replace it), and the door sensors can be hidden (the window sensors are not hidden). The wired package also has some disadvantages, it takes a lot of effort to add on to the system. If you want to add another window sensor, or glass breaking sensor you can't without having to run wire through your walls. With a wireless system you just put a battery in and put it where you want. In the end I decided to not go with guardian for the wired alarm system, although I will consider them and ATK (plus others) for their wireless system. The guardian guy pushed the alarm system using quite a few scare tactics. When I continued to say no he offered me three months free OR a free smoke detector. When I continued to say no it turned in to three months free AND a smoke detector. This was tempting but just wasn't enough to get me, but if you are going to use them for your alarm company try saying you aren't interested, you may get similar offers to mine.
In the end I didn't get much from guardian except a few cable runs because I plan on doing most of the stuff myself for less money and a better system. It actually isn't about the money for me on this topic, I really enjoy setting these types of things up myself and doing it the way I want it done. That might not be for everyone though. Overall, the Guardian rep was nice, only a little pushy on the alarm system (but not overly pushy) and was knowledgeable about what he was talking about.
The home comes with two phone jacks, and two cable jacks. The phone jacks have to be in the kitchen and master bedroom. The cable jacks have to be in the family room and master bedroom. If you want them elsewhere you should ask, but there is no guarantee that they will do it. You should know that they use Cat5 cable for the phone lines too, and the jacks they use accept both phone and Ethernet plugs, so if you don't plan on having a home phone system these can still be used for internet. They were charging me $95 per additional phone, Ethernet or phone line that they put in. This is something you can do your self after you move in but it involves cutting drywall and patching it up. If you plan on painting the place this isn't so bad since you will paint the patches. Even if you don't plan on painting you can paint the patches you make with the same color paint they have. It is difficult to run a line between floors, so I asked them to run a cable line and two cat5 lines (one can be used for phone) up to the attic. This way I can split the cables from there and easily run them in to each bedroom, I think this was worth the $285.
They also hang a tv up for you and run lines behind the wall to the cable box\blu ray player. The price for this seemed a bit high, and if you have a little DIY skills you can also do this yourself with little trouble. What I didn't like about this service is they run a specific number of cables, I believe it was one HDMI and one set of component cables. If you have more than two devices, or need two HDMI cables you will be out of luck, so think ahead.
They also offer features such as whole house audio, setting up in wall speakers. Agian, these are things you could do later (and better) if you have the know how for less. The research I did showed that these things add very little value to your house, so you won't make the money back when you sell the house; however, if it is something you want and don't know how to do it your self it may be worth having guardian do it.
Guardians big thing is the alarm system. They want to put a wired alarm system in to your house for little cost and then have you committed to paying for their alarm service for 3 years. This is what they will spend the most time selling you on. My wife and I wanted an alarm system so we looked at what we got for free plus what we would want to add on. We only got one control panel, sensors on the doors to the house, and a motion detector for free. To get sensors on the first floor windows, another control panel and a smoke detector would have been many hundreds of dollars. As a comparison we could get a wireless system with ATK for $100 installed that had everything we wanted (ATKs package came with more free stuff if you sign a 3 year contract). The monthly cost was $2 cheaper per month with ATK. ATK also had the ability to monitor your home from your cell phone, a feature Guardian's wired package currently does not (but it is in the works). The guardian rep tried to sell me on the idea of a wired system. It has a couple of advantages, you don't have to replace batteries (ATK does monitor the batteries in all your devices and will call you when one gets low so you know to replace it), and the door sensors can be hidden (the window sensors are not hidden). The wired package also has some disadvantages, it takes a lot of effort to add on to the system. If you want to add another window sensor, or glass breaking sensor you can't without having to run wire through your walls. With a wireless system you just put a battery in and put it where you want. In the end I decided to not go with guardian for the wired alarm system, although I will consider them and ATK (plus others) for their wireless system. The guardian guy pushed the alarm system using quite a few scare tactics. When I continued to say no he offered me three months free OR a free smoke detector. When I continued to say no it turned in to three months free AND a smoke detector. This was tempting but just wasn't enough to get me, but if you are going to use them for your alarm company try saying you aren't interested, you may get similar offers to mine.
In the end I didn't get much from guardian except a few cable runs because I plan on doing most of the stuff myself for less money and a better system. It actually isn't about the money for me on this topic, I really enjoy setting these types of things up myself and doing it the way I want it done. That might not be for everyone though. Overall, the Guardian rep was nice, only a little pushy on the alarm system (but not overly pushy) and was knowledgeable about what he was talking about.
Monday, February 13, 2012
Over priced upgrades
As I mentioned before after you sign your contract you have two weeks to make changes. During this time I did research on a few of the upgrades and I found some really surprising results. As the title of this post suggests I discovered that the upgrades offered by Ryan Homes are well over priced.
The most blatant of over priced upgrades (that I discovered) was the appliances. My wife and I had opted for the second highest level. This upgrade was $3,300 for a GE profile oven, dishwasher and above the stove microwave. When I looked up the price on Lowe's and Sears I could buy all three for $2,900. That is a savings of $400, plus if I sell the very basic stove, oven and above the stove exhaust fan for 50% on Craig's list I could get $600, that'll bring my savings to $1000 easy!! Plus I can get any brand. Needless to say we changed our upgrade to the basic package. My wife and I also plan to hit the Memorial day sale and save even more.
The kitchen knobs are a similar story. They charge $200 for knobs on the kitchen and bathroom cabinets. The knobs they use are simple chrome knobs. I never counted the number of knobs but I would guess 40 in the entire house. At $3 a piece (price at home depot) that would cost $120. Knobs are super easy to install your grandmother can do it, all you need is a drill. Plus, you can add style to your kitchen by choosing from hundreads of knobs at home depot instead of being forced to have the same knobs as all your neighbors. You can also get light fixtures and faucet upgrades for cheaper than the upgrade (plus sell whatever they give you on Criag's list to make even more money).
The bigger ticket items such as granite counter tops also can be done cheaper than the upgrade itself. The granite upgrade in our model (the Rome) is about $4,500. I got an estimate from Home Depot for the same granite for $3,200 installed plus $900 to remove the old counter tops. In total I could save $400. What is amazing here is Ryan homes already has to install the counter tops PLUS they don't have to remove old counter tops PLUS you already paid for basic counter tops in the price of the house, so you can just see the profit Ryan is making off their customers upgrades. Ridiculous huh!
You might be asking how can Ryan Homes charge such crazy prices for their upgrades. They are relying on two things. First they are hoping that their customers don't realize, either by ignorance or since Ryan prices their upgrades as one price, instead of the more familiar individual price or price per square foot you would see at a store. Secondly and most importantly they hope that their customers need to roll the cost in to their mortgage. The only way you can put the cost of the stove in to your mortgage is to buy it through Ryan Homes. If you don't have a down payment that can cover doing these items on your own, then if you want them you have to pay the extra price.
If you already bought the upgrades you shouldn't worry too much, you probably added as much value to your home as you paid in the upgrade. When you upgrade parts of the house it sells for more than the upgrade cost. People who buy fixer upers, fix everything, and then sell make money because it cost less to upgrade most things than it adds to the home value. The same applies for new homes too except Ryan is making the profit instead of you, you most likely broke even. But there is a few grand out there that you can save if you play it smart. Finishing your basement (if it wasn't your incentive like it was ours) is also a good way to make save money.
Also, as far as I can tell it would be hard to upgrade the carpet after the house is built for less than the upgrade, but it is very close (Ryan I am sure is still making money on the upgrade because they don't have to pay to tear out old carpet). It'll depend on the quality of the upgraded carpet which I haven't seen. We have our flooring meeting on Friday, so I'll let you know after that.
Lastly, I will say even with some price gouging for the upgrades Ryan Homes still seems priced well. I am talking about a few thousand in savings at most by doing the upgrades after the house is built.
The most blatant of over priced upgrades (that I discovered) was the appliances. My wife and I had opted for the second highest level. This upgrade was $3,300 for a GE profile oven, dishwasher and above the stove microwave. When I looked up the price on Lowe's and Sears I could buy all three for $2,900. That is a savings of $400, plus if I sell the very basic stove, oven and above the stove exhaust fan for 50% on Craig's list I could get $600, that'll bring my savings to $1000 easy!! Plus I can get any brand. Needless to say we changed our upgrade to the basic package. My wife and I also plan to hit the Memorial day sale and save even more.
The kitchen knobs are a similar story. They charge $200 for knobs on the kitchen and bathroom cabinets. The knobs they use are simple chrome knobs. I never counted the number of knobs but I would guess 40 in the entire house. At $3 a piece (price at home depot) that would cost $120. Knobs are super easy to install your grandmother can do it, all you need is a drill. Plus, you can add style to your kitchen by choosing from hundreads of knobs at home depot instead of being forced to have the same knobs as all your neighbors. You can also get light fixtures and faucet upgrades for cheaper than the upgrade (plus sell whatever they give you on Criag's list to make even more money).
The bigger ticket items such as granite counter tops also can be done cheaper than the upgrade itself. The granite upgrade in our model (the Rome) is about $4,500. I got an estimate from Home Depot for the same granite for $3,200 installed plus $900 to remove the old counter tops. In total I could save $400. What is amazing here is Ryan homes already has to install the counter tops PLUS they don't have to remove old counter tops PLUS you already paid for basic counter tops in the price of the house, so you can just see the profit Ryan is making off their customers upgrades. Ridiculous huh!
You might be asking how can Ryan Homes charge such crazy prices for their upgrades. They are relying on two things. First they are hoping that their customers don't realize, either by ignorance or since Ryan prices their upgrades as one price, instead of the more familiar individual price or price per square foot you would see at a store. Secondly and most importantly they hope that their customers need to roll the cost in to their mortgage. The only way you can put the cost of the stove in to your mortgage is to buy it through Ryan Homes. If you don't have a down payment that can cover doing these items on your own, then if you want them you have to pay the extra price.
If you already bought the upgrades you shouldn't worry too much, you probably added as much value to your home as you paid in the upgrade. When you upgrade parts of the house it sells for more than the upgrade cost. People who buy fixer upers, fix everything, and then sell make money because it cost less to upgrade most things than it adds to the home value. The same applies for new homes too except Ryan is making the profit instead of you, you most likely broke even. But there is a few grand out there that you can save if you play it smart. Finishing your basement (if it wasn't your incentive like it was ours) is also a good way to make save money.
Also, as far as I can tell it would be hard to upgrade the carpet after the house is built for less than the upgrade, but it is very close (Ryan I am sure is still making money on the upgrade because they don't have to pay to tear out old carpet). It'll depend on the quality of the upgraded carpet which I haven't seen. We have our flooring meeting on Friday, so I'll let you know after that.
Lastly, I will say even with some price gouging for the upgrades Ryan Homes still seems priced well. I am talking about a few thousand in savings at most by doing the upgrades after the house is built.
Monday, February 6, 2012
The Mortgage
After you sign the contract you have seven days to meet with the mortgage company. The place I went to they didn't have weekend or evening office hours, so be prepared to take a few hours off from work for this, but I am getting ahead of my self, let's talk about mortgages in general.
Most people buying a home don't have the money to pay cash, so they take a loan or a mortgage. A bank or someone else gives you money, and in return you pay it back, a little every month. You also have to pay them interest, think of it as you buying the loan of money, every month you'll be paying interest/buying the loan by paying more than what you borrowed. The longer they loan you money for, the more it cost to buy the loan. A standard mortgage is for 30 years which is a long time, but you can also do 20, 15 or even shorter loans. In addition to paying interest there are many other fees that are required to buy the loan. There will be an origination fee which is expressed in points or a percentage of the mortgage (1 point is 1 percent of the money that they loan you). You will pay the origination fee when you take control of the house (that is also the time the money is officially lent to you and you start paying interest). There will also be a lot of flat fees such as appraisals, application fees, credit report fees and the like. You'll also pay this at closing. To save the most money (now and over the next 30 or so years) you will want to minimize these fees which is why you want to shop around. It's a really good idea to shop around, all lenders will give you a good faith estimate of all the fees.
Ryan homes wants you to go with their lender, NVR mortgage. Just so you know NV Inc owns both Ryan Homes and NVR Mortgage (they also own other companies like NV Homes), that is why they want you to use NVR mortgage. They offered us a free finished basement (actually only part of it was free, since we added the morning room on we had to pay for the extra part of the basement to be finished). This does not mean that you should just bend over and go with NVR mortgage but first I want to discuss what is legal and not legal (and barly legal) in terms of packaging a new construction home with a mortgage.
In Maryland (and other states) there is a law that says a builder can offer incentives to a buyer to use a certain mortgage company; however, they have to offer you a mortgage comparable to what you can get shopping around. This means that they cannot put fees in or higher interests rates to negate your incentive. If your state doesn't have these laws there are also federal anti-trust laws that could be used to stop the mortgage company of adding unreasonable fees/interests rates to make back the incentive; however, after I looked at these laws I feel that it doesn't really stop it. Lucky for me I am in Maryland so I am protected, but that doesn't mean I should let my guard down. I got a couple good faith estimates from the two banks I do business with along with some research online (you can get a loan from an online company as well). I came armed with this knowledge when I showed up at my NVR mortgage appointment.
The first thing they will do is take all of your financial documentation that you brought, the Ryan rep will give you a long list when you sign the contract. This will include the last two months of statements for your bank accounts, investment accounts, pay stubs and two years of your federal taxes. They will also want statements of your loan payments (including any loans you cosigned on, such as that student loan your parents are still paying off). You will need to provide your spouses as well. The reason they want your bank statements is they want to see if you got any large payments recently (besides your job). This is because when considering your down payment in figuring your interest rate it matters weather you saved it up or your parents gave it to you. The reason is if you saved it you must be more responsible. If your parents plan on giving you money, you may want to consider getting it in your bank account a few months ahead of time. Everything else they want is just to verify your financial situation, what you make and what you owe.
I brought all of the info they needed, but I forgot one month bank statement for an account. No worries though we were able to finish everything and I mailed it to them the next day. After going through all the paperwork I brought they gave me a good faith estimate. I was expecting some large fee that they were going to try to swindle me with to make up for the incentive they offered me. To my delight there estimate was between the two estimates I had already gotten. All of them had the same interest rate and were pretty close in fees. After looking it over and finding it acceptable I signed that I wanted to proceed with the loan approval and then she came back with a ton of papers to sign. There were papers for this and that. As I mentioned before I read stuff before I sign. She was patient with me while I skimmed through everything. There was nothing complicated or a surprise and she explained any questions I had. I went by myself, which was fine. After signing all the paperwork she made copies and I brought them home for my wife to sign. She also provided me a UPS envelope prepaid so I could overnight it back to her.
Just because my NVR mortgage was similar to the banks doesn't mean it will be for you. If you are borderline between interest rates you may save big by using a lower mortgage rate at a bank than NVR mortgage. Google amortization calculator and you'll be able to figure out what your monthly payment will be and how much interest you will pay back for different loan amounts and interest rates. That $10,000 incentive might look like pennies when you see how a slight change in interest rate changes how much money you pay over 30 years. Plus that $10,000 finished basement (or other incentive) isn't really $10,000 since you could have a contractor come and and do it for $7,000 after you buy the house, but I will talk about that in a post coming up real soon. So GET MULTIPLE GOOD FAITH ESTIMATES!!!
Overall I felt that NVR mortgage was no different that the two banks I also went to. They didn't have the lowest offer, but it was definitely comparable, and with the incentive of the finished basement it was worth it. The customer service was good, but so were the banks. They did have free coffee and a good coffee station with milk and Splenda that I took advantage of, but I deserved that because it took almost three hours to go through everything (45 minutes of that was probably me reading/skimming everything, but you'll do that too). Overall the experience was average compared to the banks except I got coffee.
On a second to last note, NVR mortgage most likely will sell your mortgage to a different company the second you close on your home. In fact it is so likely that they have you sign a paper that tells you that they don't hold mortgages long term and intend to sell it. This practice is very common; although, I don't completely agree with it (but that is something for congress to fix). So don't be surprised if it ends up at a big bank or even with someone you never heard of. Your terms won't change, just who you make the check out to. The reason I don't like this practice is that I feel part of shopping around for a mortgage should involve shopping around for a company that you are willing to do business with. For example I would never do business with Chase banks (they stole my mom's money after she passed away by assessing fees to her account, I felt this was immoral); however, Chase may end up with my mortgage and I'll be forced to deal with them. That is just the way of mortgages.
On a last note there are many complexities to mortgages; however, they are easy to understand. I may write a blog in the future about it but you should understand your mortgage before you get one. Google how mortgages work or ask your parents or a friend that has a good financial head. Consumers not understanding how a mortgage works is part of the reason we had a financial collapse, the others being that banks let people take loans they knew they didn't understand and had little chance of being able to pay off. Also if you are confused ask the banker or person doing your loan. If they can't explian any part of it to you then don't sign. Understanding your mortgage s your responsibility. There are also many types of loans, from fixed to adjustable to ones with balloon payments. From what I can tell NVR only offered fixed loans which with the low interest rates we have now is the best loan for everyone. I didn't ask the rep if they offered other types of loans so I would like to hear from other people, were you offered anything except a fixed rate loan from NVR mortgage?
Most people buying a home don't have the money to pay cash, so they take a loan or a mortgage. A bank or someone else gives you money, and in return you pay it back, a little every month. You also have to pay them interest, think of it as you buying the loan of money, every month you'll be paying interest/buying the loan by paying more than what you borrowed. The longer they loan you money for, the more it cost to buy the loan. A standard mortgage is for 30 years which is a long time, but you can also do 20, 15 or even shorter loans. In addition to paying interest there are many other fees that are required to buy the loan. There will be an origination fee which is expressed in points or a percentage of the mortgage (1 point is 1 percent of the money that they loan you). You will pay the origination fee when you take control of the house (that is also the time the money is officially lent to you and you start paying interest). There will also be a lot of flat fees such as appraisals, application fees, credit report fees and the like. You'll also pay this at closing. To save the most money (now and over the next 30 or so years) you will want to minimize these fees which is why you want to shop around. It's a really good idea to shop around, all lenders will give you a good faith estimate of all the fees.
Ryan homes wants you to go with their lender, NVR mortgage. Just so you know NV Inc owns both Ryan Homes and NVR Mortgage (they also own other companies like NV Homes), that is why they want you to use NVR mortgage. They offered us a free finished basement (actually only part of it was free, since we added the morning room on we had to pay for the extra part of the basement to be finished). This does not mean that you should just bend over and go with NVR mortgage but first I want to discuss what is legal and not legal (and barly legal) in terms of packaging a new construction home with a mortgage.
In Maryland (and other states) there is a law that says a builder can offer incentives to a buyer to use a certain mortgage company; however, they have to offer you a mortgage comparable to what you can get shopping around. This means that they cannot put fees in or higher interests rates to negate your incentive. If your state doesn't have these laws there are also federal anti-trust laws that could be used to stop the mortgage company of adding unreasonable fees/interests rates to make back the incentive; however, after I looked at these laws I feel that it doesn't really stop it. Lucky for me I am in Maryland so I am protected, but that doesn't mean I should let my guard down. I got a couple good faith estimates from the two banks I do business with along with some research online (you can get a loan from an online company as well). I came armed with this knowledge when I showed up at my NVR mortgage appointment.
The first thing they will do is take all of your financial documentation that you brought, the Ryan rep will give you a long list when you sign the contract. This will include the last two months of statements for your bank accounts, investment accounts, pay stubs and two years of your federal taxes. They will also want statements of your loan payments (including any loans you cosigned on, such as that student loan your parents are still paying off). You will need to provide your spouses as well. The reason they want your bank statements is they want to see if you got any large payments recently (besides your job). This is because when considering your down payment in figuring your interest rate it matters weather you saved it up or your parents gave it to you. The reason is if you saved it you must be more responsible. If your parents plan on giving you money, you may want to consider getting it in your bank account a few months ahead of time. Everything else they want is just to verify your financial situation, what you make and what you owe.
I brought all of the info they needed, but I forgot one month bank statement for an account. No worries though we were able to finish everything and I mailed it to them the next day. After going through all the paperwork I brought they gave me a good faith estimate. I was expecting some large fee that they were going to try to swindle me with to make up for the incentive they offered me. To my delight there estimate was between the two estimates I had already gotten. All of them had the same interest rate and were pretty close in fees. After looking it over and finding it acceptable I signed that I wanted to proceed with the loan approval and then she came back with a ton of papers to sign. There were papers for this and that. As I mentioned before I read stuff before I sign. She was patient with me while I skimmed through everything. There was nothing complicated or a surprise and she explained any questions I had. I went by myself, which was fine. After signing all the paperwork she made copies and I brought them home for my wife to sign. She also provided me a UPS envelope prepaid so I could overnight it back to her.
Just because my NVR mortgage was similar to the banks doesn't mean it will be for you. If you are borderline between interest rates you may save big by using a lower mortgage rate at a bank than NVR mortgage. Google amortization calculator and you'll be able to figure out what your monthly payment will be and how much interest you will pay back for different loan amounts and interest rates. That $10,000 incentive might look like pennies when you see how a slight change in interest rate changes how much money you pay over 30 years. Plus that $10,000 finished basement (or other incentive) isn't really $10,000 since you could have a contractor come and and do it for $7,000 after you buy the house, but I will talk about that in a post coming up real soon. So GET MULTIPLE GOOD FAITH ESTIMATES!!!
Overall I felt that NVR mortgage was no different that the two banks I also went to. They didn't have the lowest offer, but it was definitely comparable, and with the incentive of the finished basement it was worth it. The customer service was good, but so were the banks. They did have free coffee and a good coffee station with milk and Splenda that I took advantage of, but I deserved that because it took almost three hours to go through everything (45 minutes of that was probably me reading/skimming everything, but you'll do that too). Overall the experience was average compared to the banks except I got coffee.
On a second to last note, NVR mortgage most likely will sell your mortgage to a different company the second you close on your home. In fact it is so likely that they have you sign a paper that tells you that they don't hold mortgages long term and intend to sell it. This practice is very common; although, I don't completely agree with it (but that is something for congress to fix). So don't be surprised if it ends up at a big bank or even with someone you never heard of. Your terms won't change, just who you make the check out to. The reason I don't like this practice is that I feel part of shopping around for a mortgage should involve shopping around for a company that you are willing to do business with. For example I would never do business with Chase banks (they stole my mom's money after she passed away by assessing fees to her account, I felt this was immoral); however, Chase may end up with my mortgage and I'll be forced to deal with them. That is just the way of mortgages.
On a last note there are many complexities to mortgages; however, they are easy to understand. I may write a blog in the future about it but you should understand your mortgage before you get one. Google how mortgages work or ask your parents or a friend that has a good financial head. Consumers not understanding how a mortgage works is part of the reason we had a financial collapse, the others being that banks let people take loans they knew they didn't understand and had little chance of being able to pay off. Also if you are confused ask the banker or person doing your loan. If they can't explian any part of it to you then don't sign. Understanding your mortgage s your responsibility. There are also many types of loans, from fixed to adjustable to ones with balloon payments. From what I can tell NVR only offered fixed loans which with the low interest rates we have now is the best loan for everyone. I didn't ask the rep if they offered other types of loans so I would like to hear from other people, were you offered anything except a fixed rate loan from NVR mortgage?
Thursday, February 2, 2012
The contract
After you decide on the house you want then you sign the contract. This was about a three hour process for us and Ryan's rep told us that that is typical. I recommend you make an appointment. Prior to this meeting I asked for a copy of the contract that they wanted me to sign and they did just that without any hassle. I read the entire contract so that I knew what was in it and what I was signing, and I highly recommend you do the same thing. They'll give you a one line summery for each section of what you sign, but I felt that she often didn't paint the whole picture for that section and glazed over the parts that are weighted in their favor. For example, they can delay your construction for basically any reason and you just have to deal; however, if you are out of town or in the hospital on the day they want to close they could charge you hefty fines.
The contract also lays out the building standards that they use which is the standards a national organization sets. I found this reassuring to know they don't decide what is quality work and what isn't. The contract also says you can't go on to the property during construction to check things out without prior approval. I told our rep it was my intention to stop by every day or two to check it out and walk around. She told me that wasn't a problem and to just let the construction manager know ahead of time so he could warn me of any dangers. I am still worried about it though because how the contract is written they could deny me access every day. I'll definitely report on how that goes. They could also deny a home inspector access until the very end (you really want the inspector to come out a couple times, but more on that later), but again I was assured that they wouldn't. I'll just have to hold my breath and find out how that goes as well. of course I'll raise a ruckus if it doesn't work out; however, other people didn't seem to have any problems.
During the signing you also be initialing floor plans, choosing all your options and filling out a mortgage survey if you plan on using their mortgage provider. I'll talk in detail about the mortgage in a later post. You also will have time to change some of the options you choose with no penalty. Some things you will have up to two weeks, and others one month. They'll let you know when you are there. If you are buying the house with someone else, such as your spouse, they will need to be there as well. I will point out that we also had our one year old son with us. The rep let him play all over on the floor of her office while we signed papers and never once got annoyed when he was loud or smashed food in to the carpet (which we made sure was clean before leaving), so big props to her for the customer service!
Although the process was long, it was pretty painless, especially since I read the contract ahead of time which I recommend you to do. While you read the contract you have to remember that even though it is heavily waited in their side there isn't a thing you can do about it, it isn't like they are going to change it for you. It is just something you have to deal with if you want a newly built house, but by reading the contract you at least know how far backwards they can make you bend.
When we were all done they gave us a sold sticker to put on the board with all the lots so we could cover our lot up. My wife loved it!
Tuesday, January 31, 2012
First thing first
As I mentioned in my first post I am going back to blog about some of the steps I've been through already. Well the first thing everyone does is to check out the model homes. Almost all of these developers have a handful of floor plans you can choose from. They will typically have a built model home at the new community for perspective buyers to take a look at. Other communities in the area will typically have a different model home so you can see different floor plans. Before going to see your first model home (and talking to the agent there) you should know some things.
First, if you want a real estate agent to represent you then you need to have them present at your first meeting. The reason for this is because Ryan Homes will sometimes pay your Realtor the 3% fee if you buy the place if they are the ones to bring you there, think of it as a finder's fee. If you try to bring the Realtor in later Ryan Homes won't pay them; therefore, you will need to. It isn't a bad idea to have a Realtor represent you (it can't hurt); although, if you feel comfortable negotiating then you can make do without one. My wife and I aren't using a Realtor.
Second, sometimes, if you are referred by someone else in the community then both you and them can get an incentive. You need to tell them who referred you on your first visit. It might be a good idea to stop and talk to any home owners on the street as you drive through and get their name. Instant good karma for making friends with the neighbors. While you are at it you can also ask about their experience with the building process and any advice. If you don't see anyone then get a name off the mail box. My wife and I put down a friends name that bought in a near by Ryan community; therefore, we didn't get the incentive which would have been $500. It was very disappointing that Ryan feels that only certain customers can refer other customers.
If you are not ready with either of the above you could still go to the model home, just refuse to put down your info (or put a fake name) on their list. Wait until you have a Realtor or a referral until you start talking to them.
Third, you should never tell them how much money you have, annual income, what your price range is, or any other financial information. They don't tell you what there financial situation is, so why should you tell them yours. It gives them an advantage in any negotiations on price or incentives. Just leave the fields blank. If they ask you to fill it out you should decline. If they ask you as you walk in the door you can just say you can afford any house that you find to be a good fit for your family. That steers the discussion to show me the house and we can talk about money if I am interested.
Lastly, and most importantly, is that they apply high pressure sales tactics. The agents goal is to get you to sign a contract and the best way to get you to commit is to put down a deposit. Even if it is refundable they know if you put down a deposit they have a hook in you. To get you to put down a deposit they will quickly offer you some type of incentive, a free upgrade or case towards closing and then act as if it is a one time deal and might not be there in the future. This is a common sales tactic used to give the buyer a sense of urgency and jump before thinking. So when the high pressure sales tactics start being used take a breath and just tell them you'll think about it.
This brings us to something all buyers should be aware of and always keep in mind at all times. All the people that you'll deal with that work for the developer has the developers best interests in mind not yours. There job is to make the company money, not doing what's best for you. If they can get you to buy a house that isn't best for you they still get paid, that is why they try to get you to jump at the first meeting before you think about it. They'll even tell you that they represent the buyer in the contract that you sign, the reason they mention it in the contract is because they will act as if they care about your interests to the point that if they don't have you sign that you know they aren't your repersenitive they could get sued. This goes beyond just selling the house, so keep it in mind during the whole process, I know I will.
First, if you want a real estate agent to represent you then you need to have them present at your first meeting. The reason for this is because Ryan Homes will sometimes pay your Realtor the 3% fee if you buy the place if they are the ones to bring you there, think of it as a finder's fee. If you try to bring the Realtor in later Ryan Homes won't pay them; therefore, you will need to. It isn't a bad idea to have a Realtor represent you (it can't hurt); although, if you feel comfortable negotiating then you can make do without one. My wife and I aren't using a Realtor.
Second, sometimes, if you are referred by someone else in the community then both you and them can get an incentive. You need to tell them who referred you on your first visit. It might be a good idea to stop and talk to any home owners on the street as you drive through and get their name. Instant good karma for making friends with the neighbors. While you are at it you can also ask about their experience with the building process and any advice. If you don't see anyone then get a name off the mail box. My wife and I put down a friends name that bought in a near by Ryan community; therefore, we didn't get the incentive which would have been $500. It was very disappointing that Ryan feels that only certain customers can refer other customers.
If you are not ready with either of the above you could still go to the model home, just refuse to put down your info (or put a fake name) on their list. Wait until you have a Realtor or a referral until you start talking to them.
Third, you should never tell them how much money you have, annual income, what your price range is, or any other financial information. They don't tell you what there financial situation is, so why should you tell them yours. It gives them an advantage in any negotiations on price or incentives. Just leave the fields blank. If they ask you to fill it out you should decline. If they ask you as you walk in the door you can just say you can afford any house that you find to be a good fit for your family. That steers the discussion to show me the house and we can talk about money if I am interested.
Lastly, and most importantly, is that they apply high pressure sales tactics. The agents goal is to get you to sign a contract and the best way to get you to commit is to put down a deposit. Even if it is refundable they know if you put down a deposit they have a hook in you. To get you to put down a deposit they will quickly offer you some type of incentive, a free upgrade or case towards closing and then act as if it is a one time deal and might not be there in the future. This is a common sales tactic used to give the buyer a sense of urgency and jump before thinking. So when the high pressure sales tactics start being used take a breath and just tell them you'll think about it.
This brings us to something all buyers should be aware of and always keep in mind at all times. All the people that you'll deal with that work for the developer has the developers best interests in mind not yours. There job is to make the company money, not doing what's best for you. If they can get you to buy a house that isn't best for you they still get paid, that is why they try to get you to jump at the first meeting before you think about it. They'll even tell you that they represent the buyer in the contract that you sign, the reason they mention it in the contract is because they will act as if they care about your interests to the point that if they don't have you sign that you know they aren't your repersenitive they could get sued. This goes beyond just selling the house, so keep it in mind during the whole process, I know I will.
About the blog
Hi everyone, and welcome to my blog about my experience building with Ryan Homes. I include a link to their website because there are some other builders that have similar names. Let me start with what I hope this blog will become, ad then I'll talk to you a little about myself.
There is some stuff on the internet that gives advice and experiences from people building a house. There are also a couple blogs (including others that used Ryan Homes). I am hoping that this blog will be an additional source for other that are looking to build a house. I am going to write about advice that I have gotten from research or talking with friends and how I'll use it to approach the whole process. I'll also talk about how my experience is going, what I am glad I did or what I wish I had done differently. I hope that someone reading my blog will gain insight and their process will be improved from my experiences. I am starting this blog just after signing the contract with Ryan Homes so I do not know yet if the process will be great or not but I bet valuable advice will come from it. The next few posts will be about the process so far, and then after that I'll do my best to blog about things as they happen. I am not going to share which Ryan community I am building in to protect my privacy a little, but I will share that it is in Maryland.
A little bit about my wife and I. We are in our late twenties, and this will be our first house that we have bought. We both are very thoughtful in all of our decisions doing a lot of research and weighing pros and cons before making a decision. We spent a lot of time looking at houses and considering different developers which is when I noticed that it would have been helpful if more people talked about their experience, good or bad. This is my first blog, so it's also a learning experience for me in using the tools and the best practices to write about the experience, so bear with me at first.
Lastly I'll point out that their are two very different categories of having a home built. First, and what my wife and I are doing, is to find a developer who has a ton of lots in a community and is building houses on them as they get buyers. They will have a handful of floor plans to choose from and a decently large selection of options to choose from; however, there will still be stuff you can't change, or choices that are limited by the options available. For example you can choose from a few kitchen sinks. You decide on all the options and then they build your house on a lot you choose. When they are done they transfer the deed to you. The second option is to find a builder and a lot and have the builder build you a house on the lot. Here the builder will typically build any floor plan you find (or have made by an architect). In this case every aspect of the home you can choose or change. You can go to Home Depot and choose any kitchen sink you want. Some of what I will talk about will apply to building a house both ways, but I wanted to point out that it'll focus on building a new development with a builder such as Ryan Homes.
On a second last note I'll point out I have allowed anyone to leave comments. No user accounts are needed. I hope to generate questions this way, so feel free to ask. I also hope that others may give advice, hopefully in time for me to act on but if not at least others can use it, so please feel free to leave advice.
There is some stuff on the internet that gives advice and experiences from people building a house. There are also a couple blogs (including others that used Ryan Homes). I am hoping that this blog will be an additional source for other that are looking to build a house. I am going to write about advice that I have gotten from research or talking with friends and how I'll use it to approach the whole process. I'll also talk about how my experience is going, what I am glad I did or what I wish I had done differently. I hope that someone reading my blog will gain insight and their process will be improved from my experiences. I am starting this blog just after signing the contract with Ryan Homes so I do not know yet if the process will be great or not but I bet valuable advice will come from it. The next few posts will be about the process so far, and then after that I'll do my best to blog about things as they happen. I am not going to share which Ryan community I am building in to protect my privacy a little, but I will share that it is in Maryland.
A little bit about my wife and I. We are in our late twenties, and this will be our first house that we have bought. We both are very thoughtful in all of our decisions doing a lot of research and weighing pros and cons before making a decision. We spent a lot of time looking at houses and considering different developers which is when I noticed that it would have been helpful if more people talked about their experience, good or bad. This is my first blog, so it's also a learning experience for me in using the tools and the best practices to write about the experience, so bear with me at first.
Lastly I'll point out that their are two very different categories of having a home built. First, and what my wife and I are doing, is to find a developer who has a ton of lots in a community and is building houses on them as they get buyers. They will have a handful of floor plans to choose from and a decently large selection of options to choose from; however, there will still be stuff you can't change, or choices that are limited by the options available. For example you can choose from a few kitchen sinks. You decide on all the options and then they build your house on a lot you choose. When they are done they transfer the deed to you. The second option is to find a builder and a lot and have the builder build you a house on the lot. Here the builder will typically build any floor plan you find (or have made by an architect). In this case every aspect of the home you can choose or change. You can go to Home Depot and choose any kitchen sink you want. Some of what I will talk about will apply to building a house both ways, but I wanted to point out that it'll focus on building a new development with a builder such as Ryan Homes.
On a second last note I'll point out I have allowed anyone to leave comments. No user accounts are needed. I hope to generate questions this way, so feel free to ask. I also hope that others may give advice, hopefully in time for me to act on but if not at least others can use it, so please feel free to leave advice.
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