It was 2008, and our country was going through the most challenging financial era since the great depression. Big banks were closing down every week, lenders weren't lending, unemployment was at an all-time high, and it felt like 100's or 1000's of homes were foreclosing. It was at this time, I decided to buy my first home.
I was only 25 and I had just gotten into real estate the year before, so I was a "newbie". I literally didn't know the difference between a sump pump and a water heater (OK not really but you get it). At this time, I wasn't a licensed realtor, but I was selling new homes for a builder. I was doing alright financially (not great), and I decided to buy my first home.
The very first place I decided to buy was in the city, Chicago. It was an awesome new construction loft, not far from the neighborhood I grew up in. I remember putting my deposit down, signing the papers and picking out my interior selections. I was going to close in about 60 days, and it was all really exciting. Meanwhile, the real estate world around me was still collapsing, and there was no end in sight to the recession. Merrill Lynch went under, so did Lehmen Brothers, and all of these big builders were filing for bankruptcy... But I didn't know, or care.
Speaking of didn't know... After putting my deposit down and signing papers, I was all set to close on this condo in just a few months... Except, I never did. Not because the builder went under, or because I was denied a loan... But because I walked away, the night before the closing.
Yep. My place was ready to go, I got my final numbers from the lender, closing was scheduled... And I called my attorney and said I'm OUT.... But wait, I'm in real estate, what the hell was I thinking and why did I walk away? I'll tell you why...
I was UNPREPARED, and I didn't have the correct real estate professionals helping me. Had no clue what I was getting into. This purchase was literally going to drain me of just about every penny in my bank account (and put me upside down, because I borrowed some of the down payment money!). You can't buy a home, and have a few hundred dollars left in the bank.
My lack of preparation, and not having the right team in place (lender, attorney AND realtor to coach me) was going to make me broke. And lose everything. I remember having about $18,000 or so in my bank account, and the day before the closing the lender sends me over the final numbers for closing, which was $17,500 something. There were a ton of costs I wasn't prepared for, and didn't know about!
After the closing, I wouldn't have enough money left over to buy a couch, or TV! Imagine that, I would have my badass new condo with an air mattress, folding table & chairs, and we're eating Ramen noodles until I build it back up!
So I decided to walk away from the deal. I lost my earnest money, and that's fine. It was the price I paid, my "tuition" I call it, for the knowledge I gained in the process. There are so many things you have to budget for, and I didn't ask the right questions, nor did I have the help I needed from my realtor at the time. I don't blame him, I take full accountability for my actions. But there is something to be said about having a good realtor in your corner to guide you through the buying process and prepare you, so you don't make mistakes like I did.
If you have any questions about buying or selling a home, don't hesitate to reach out to me and ask questions. My 12 years experience in this business can help prepare you so you can avoid paying the extra "tuition" like I did.
103 Realty - Realtor & Owner