house negotitations

So, let me tell you about this house. When we first saw it, it was listed at 550. We loved it-- it was two separate houses one a lot, with 2 garages. The lot is huge, 8,700 square feet, the second unit has 2 bedrooms, a great kitchen and its own yard. Both houses are in great shape. Great, this is exactly what we want, and it's out of our range.

We talked to the agent, the agent said, "she'll let it go for 460." We said, ok wow we can actually do that. We put in an offer at 460, our offer had an appraisal contingency, so that if the property appraises for less they have to drop the price to the appraisal.

Endless paperwork later, we're finally approved for the loan, and the appraisal comes back at 405. We're very excited, she has to drop the price, right? We offer 405. Well actually she has a backup offer at 435, so she counters at 435.

Now here's the thing, the bank is only going to lend us money against the appraised value of 405k, so if we want to buy the house for more than that we need to make up the difference up-front with cash. We were a bit lean in the down-payment department to begin with*, so this represents significant pain for us. We review our finances and counter 420, and it's as high as we're willing to go. We think we've lost the house to the other buyers at this point.

Radio silence for a few days, then we get a call saying she'll take it for 425, she just wants 5k more and we can seal the deal. Now, it's not the 5k in purchase price that's a problem, it's the fact that it's up-front that makes it a deal breaker. We can't give her more than 422 and feel like we're not being totally reckless. We already feel pretty reckless frankly.

More radio silence, then we get a call saying that our agent and the seller's agent have both agreed to take a 1.5k pay cut in order to make up the difference between us and the seller. The deal is on. So that's where we are right now. The seller has the football, we expect them to sign and pass it back to us any minute now.

I'm not totally sure how I feel about all this yet. I think it's gonna be good, but I don't want to hear your second-guessing until after we've finished the whole thing and moved in and made our first mortgage payment. Then we can talk about how irresponsible we are. ;-)

*For all you's out there wagging your finger right now, please remember that we will be renting out the front unit to cover more than half of our mortgage payment; some things are not as irresponsible as they look.