I moved to Hampton, VA for my new job in January 2009. I was a fresh graduate from South Dakota State University, and I was pretty excited about starting my professional career. It was not more than a couple of weeks, and I have made many good friends at work.

During lunch break, my colleagues often talked about the recession and its impact on housing market. A couple of friends had recently bought houses, and they kept suggesting others to take advantage of lower mortgage rate and the tax credit of $8000 for first time home buyers. I was a foreign national who has been living in the United States less than three years, and I had no idea about buying a house, getting a mortgage, and all other stuff. But I decided to learn about these things. One of my friends made appointments with some real estate agents during weekends, and I often went with him to see the houses on sale. They were mostly pre-owned houses. After a few visits, I was quite familiar about housing prices in Hampton area, mortgage rates, different mortgage types, closing costs and all other stuff you need to know or ask the real estate agents. But I was not that happy after seeing the old houses. They didn’t come with any warranty, and so do the appliances. I thought buying a house is not just earning a property, it is also an investment. I got a feeling that I should rather invest the money on a new home so that in case if I want to sell it after a few years, I would have good resale value for it. Also I didn’t want to get screwed up by the old appliances after I moved in to my house.

At that time my wife was still in South Dakota. She graduated in May, and then moved here with me. She seriously started looking new houses in the historic town of Williamsburg. Within a week, she found the Centex builder, building a new neighborhood named “Highgrove” on Cheeseman Road. We liked the place and the model home they had up there, and made a purchase agreement. We picked up a lot and customized the house the way we want it to be. The Centex builder has collaboration with CTX Mortgage Company. If a buyer gets financed with CTX, the builder will pay for the closing cost, which was about $9000. This was a good offer. In the beginning, we were worrying if we will get a competitive mortgage rate from CTX or not. But I have maintained a good credit score in past two and half years, and this helped me to lock in my mortgage rate at 5.00%. I never tried to get Good Faith of Estimates from any other mortgage companies (which may not be a good idea) but I knew I have a good credit history and if one bank can offer me a good rate then others should equally do. We are going to put just 3.5% for down payment, which in our case is about $9000. If you are putting less than 20% for down payment, you need to buy insurance on your mortgage that will slightly increase your monthly payment. We have started saving $500 – $800 every month from our paycheck since June. We are planning to manage the rest of the money for the down payment by borrowing from friends. We are not worrying much of paying it back because we will get the tax credit amount of $8000 in February. The house is getting ready by Nov 12. Definitely the expenses will go up after that , but we are happy that we will have a piece of land of our own and a sweet home built upon it.

So the bottom line is, maintain good credit score, save money on monthly basis, find the right property, and do some research on mortgage types before making the final decision on buying a house.