First time home buyer takes a blow to the gut!

[Pixel Shooter]

I bet you can get 2.94% at ATB if you wait a couple days and ask for it
Glad it worked out and big congratulations! When it comes to acreages or self builds, ATB is hard to beat

Originally Posted by Jhass

Alright guys, those of you who are wondering how things worked out... excellent! I got approved with ATB at 2.99% with 20% down. I had to put the 20% down because cmhc wouldn't even consider offering me mortgage insurance due to the age of the home and amount of land. Not a big deal though. I move in march 22nd which is 7 days after my 21st birthday.... little gift to myself I guess. The biggest thing here and a shocker indeed was that ATB appraised the property at 288k for the house and first 15 acres. The whole property itself is worth 420k+ so already I made an amazing investment considering I paid 320k. It was a fight... but when you really really want something... you have to fight for it. I hope this inspires others to strive for what they want in life and to not give up even when things seem impossible. There's always hope and a possibility. I want to thank everyone here who dedicated their time to offer me some valuable information. I must say that if it wasn't for this community... I would of been hopeless. Thank you all! I appreciate everything you guys have done.

[Janaives]

Buy a cheaper house learn to walk befor you run. Learn to save befor you spend. Welcome to adulthood.

[hayseed]

Big congrats on your purchase...good to hear it all worked out!!

Enjoy your new digs!!!

[Jhass]

Originally Posted by KegRiver

None of the banks I've ever dealt with did.
If you haven't borrowed before, you have no credit rating. Your credit rating is zero.

At 21 I had been earning a living, supporting a wife and child and had borrowed small amounts, I still needed a co-signer to get a loan to buy a house. And my wage did not qualify me for enough to buy the cheapest house in town.
Back then I was a heavy equipment operator with over five years of experience.

Today I own two houses, an almost new pickup and I've been working the same job for over 12 years. I do have a credit history and thus a A+ credit rating. Still, I don't qualify for a $350,000.00 home. I don't have enough equity or enough income.

You are fortunate indeed to have a credit rating without borrowing before and even more fortunate to have been approved for a loan that many people can only dream of getting.

Your good fortune seems to go even further then that.
A check of acreage prices close to Red Deer turns up several 2,000 foot square homes on one or two acres selling for $350,000.00 to 1,200,000.00.
You were incredibly fortunate to find such a home on so much land so cheap from what I can tell.

I thought you said you were a heavy equipment operator like me.
How you managed to buy a brand new pickup, with cash, and now a $350,000.00 home, in three years of operating heavy equipment is to say the least, astonishing.

I have loaned before with previous vehicles when I first got my license... but not brand new. I have been using my credit card to pay for everything since I was 18 and made sure I pay it off completely at the end of each month. So I have accumulated some credit. Also I never stated this place was close to Red Deer but rather an hour away. The home is an older Modular which is quite rough in the interior and needs work. It's 2100 sq ft due the fact that is has a attached garage which is heated and insulated. The living space is really only 1700 sq ft. And yes I have operated equipment for 3 years and make a lot of money doing so.... but I do know how to manage my money.

[RescueDiver]

Originally Posted by brettk.

Jhass, the problem starts at the fact that people beleive a pre-approval means something. It doesn't. It is simply a guide line for what could be and acts as a rate hold. When you said things got serious when you made an offer, your right, it did. Now the lenders that your broker is dealing with are doing credit checks. At 21, your credit is probably very low, no crack at you, it takes time to build. You also have 0 net worth. Again not another crack at you, simple fact of life at 21. I could go on for awhile but the fact of the matter is this is reality and another broker nevermind a Bank may not be able to do any better. The one great thing about a broker is your best intrest is also theirs. You get a mortgage they get paid, you don't they don't. I highly doubt she is trying to screw you, the lenders make the ultimate desicion. The amount of money you have or are earning are not the most important things in getting a loan for a home. There is a reason most 21 year olds don't have a mortgage. But I do hope something works out for you.

I good broker will do all the checks, and know before you make an offer what your chances of being approved are. After looking at your file, if it isn't straight forward then they should be letting you know of potential issues to the deal.

Also, all brokers are not created equal.....you can't assume they are getting you the best rate. Brokers have volume deals with lenders that pay them more money on closing......or they just might not like dealing with one lender over another. Example.....Over a year ago I was placing mortgages with ING a lot. All of the sudden rates dropped but they didn't stay competitive. I could get a client 2.99% on a 5 year fixed term and they wouldn't go below 3.19%. Now I simple moved mortgages over to where I could get the best deal for my client.....but ING still did business.....millions of dollars worth....why.

[RescueDiver]

Originally Posted by Pixel Shooter

not really worth the paper it is written on Dave. People want to be qualified all the time but only in respect to maximum dollar of mtg they would qualify for, after that, still much work to be done before the actual approval process unfortunately. but atleast people know in advance price ranges they should be looking at and infact the bank will entertain a deal, meaning nothing unforseeable will derail, ie credit bureau, income verification, yada yada. Most good realtors will have their purchasers, especially first time home owners go thru this, call it good time management and piece of mind as you say. just my 2 cents

Good point Pixel and correct. As a mortgage broker I just want to add a couple things on pre-approvals.

Most bank pre-approvals are generated electronically. They input basic info into the computer....do a soft pull of credit and bang your pre-approved. But there is a lot more to it. They do this because the majority of people with end up getting approved in the end and it makes you stay with them.....because you think you have a pre-approval and why would you seek another one.

Additionally, not all mortgage brokers a created equally either. Some will simply do the same thing. The good ones know what the lenders will want to see to prove income, job status, downpayment ext. ....they will ask you for these documents and basically underwrite the deal in advance. They minimizes the chances you will have problems once you make an offer....there is a lot of things that can derail a mortgage. They will also explain to you what could derail the deal and work with your realtor to make sure you are not putting an offer on the house that won't get approved.

Additionally, a good broker will have up to date knowledge of what the lenders require, as this changes week to week.

[norwestalta]

Congratulations on your little piece of paradise. I to had problems buying my house/farm. The worst thing you can do is tell bank you're buying land in my opinion? They only take 10 acres into account and high down payment. My down payment was $65000 and higher interest than I wanted to pay. Went to atb who I thought would work with a fella but not the case. I ended up going to fcc which I'm glad I did. The little bit extra in interest I pay makes it well worth the hassle of not having to get a appraisal done and they are much easier to deal with if want to buy tractor and such things. If your a equipment operator how do you make that kind of money working for wages? Must be contract operator which makes it harder yet when self employed. If you're that busy I'd be thinking of buying a piece of iron and that'll pay for your house.

[a little redneck]

Congrats.... as time goes you can always build what you want on your property or find another property. You're in the game now.

[BuckCuller]

Congratulations! People have to realize this is a new age and patience doesn't get you anywhere any more. You have to be aggressive to get what you want or you just get screwed. And if you grew up in these times would you turn down 120000 a year to make the old guys feel better, not me I would take it and run. It's not a sense of entitlement it's called ambition and trying to get ahead. I don't know about anyone else but the only people I owe an explanation to is my family and I will do what it takes to provide them with what I can. Good job and I think you will have a bright future.

[Digger1]

Congrats JHASS and a good read. My wife (a former realtor) enjoyed it too.

And northwestalta, you don't need to be a contract operator to make decent coin running iron. I make considerably more than 120, as a company operator with my own pickup, and I'm not the highest paid in the outfit. And I'm home every night to boot. You just have to work when you got it

[Jimboy]

Originally Posted by Jhass

As I said I already have the 20% down and more so that is no issue. Also I still could afford the house at 7% but I'm not even going to consider paying that much if i can do better. My pre-approval was done 3 weeks ago... find it hard to believe the rate changes from 3-7% since then.

Go talk to a credit union

[mooseburger]

Originally Posted by Kanonfodder

Talk to jamie !

x2

[rhuntley12]

Late to the thread but glad it worked out. We used a mortgage broker when we bought our acreage and she was great. We went through the bank originally as we could only put 10% down on the house until we sold our other house. Bank said not a chance in hell would they approve it. Mortgage broker got it done without fibbing numbers.

Buying acreage we were told the bank will only consider something like the first 3 or 4 acres for value or something along those lines.

CMHC can be a total pain in the butt too depending who you get there, half them have no idea.

[KegRiver]

Originally Posted by norwestalta

Congratulations on your little piece of paradise. I to had problems buying my house/farm. The worst thing you can do is tell bank you're buying land in my opinion? They only take 10 acres into account and high down payment. My down payment was $65000 and higher interest than I wanted to pay. Went to atb who I thought would work with a fella but not the case. I ended up going to fcc which I'm glad I did. The little bit extra in interest I pay makes it well worth the hassle of not having to get a appraisal done and they are much easier to deal with if want to buy tractor and such things. If your a equipment operator how do you make that kind of money working for wages? Must be contract operator which makes it harder yet when self employed. If you're that busy I'd be thinking of buying a piece of iron and that'll pay for your house.

Actually I think there are a couple of ways a person could earn that kind of money working for wages. The oilfield for example.

But those jobs are hard to get when you are young and inexperienced.

That's why I said he was very fortunate to get that sort of wage.


I was fortunate as well, I had one of those jobs, worked my way up to driller. But my luck ran out just when I started to get ahead.

The NEP happened and I had to take a job in town just to make ends meet.

I know what it's like to work 16 hours a day for months at a time. I know what it's like to see your children grow up, in pictures.

Now these young bucks think they are hard done by when they had a tiny bit of trouble getting a home of their own at age 21. And they look down on "Old guys" like me, calling us "lazy and stupid."

They have no idea what hard times are, or what hard work is.

Try eating boiled wheat for weeks at a time cause that's all there is. I've done it.
Try stooking forty acres of Barley in a day. Then show me your bleeding hands. I'll show you the scars on mine.
Try sleeping in a ditch, with one light blanket for cover. In the NWT in August.
Try working even one week of 20 hour shifts I've done it for months, with no coffee breaks or lunch breaks.
Try living in a camper through several norther winters.

And keep in mind that I had it easy compared to many of my generation.


Like I said, he is very very fortunate.

Yeah, good for him that he is able to buy a house, any house. But appreciate it for what it is. Good fortune. And know that many will never be able to own a home, through no fault of their own.

[bwcweld]

if its subject to suitable financing then pull the pin and leave them all hanging