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Ask HN: Buying house – any disruptors I can use?

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Ask HN: Buying house – any disruptors I can use?

#1

Post by 100-xyz »

We are starting to look at houses and are realizing how much we will be paying for services that IMO are quite mundane.

1) Mortgage broker - This lady will charge us 1% (10,000$) to find us a suitable loan. Basically, she will compare about 10 loans and choose the best one. Software systems can do this easily.

2) The buying agent - so far she has not come up with any houses on her own. She finds the same things we find on line. I dont need her to visit open houses. Legally, in SF I need an agent to be present during the inspections. I can use the selling agent for a fee. If I use her to place an offer, there is a bias problem. A buyer agent may be biased towards placing a "strong" offer. The "stronger" the offer, higher the probability that it will go through and higher her share. I have researched the areas enough and am comfortable coming up with a price.

Are there any startups that are disrupting this space? Say mortgage brokers and buying agents rolled into one. Small flat fee for the mortgage broker and flat fees for the buyer agent only for services that I need?

Alternative ideas also appreciated.

Re: Ask HN: Buying house – any disruptors I can use?

#2

Post by sharemywin »

Ask if they do borrower paid compensation. you might also want to check a local credit union.

You might also try looking for mortgage brokers and small banks in smaller towns in CA with lower property values. They might be willing to give you a break since your loan amount will look big to them. And they are used to doing loans for 4-6K

Also make sure you get the inspections worked out upfront. Last thing you want to do is try to round up all the inspectors at the last minute.

Here are some you may need: pest, radon, structural, general, one with moisture detector

for buyers agent https://www.upnest.com/ finds agents willing to offer buy credits

Re: Ask HN: Buying house – any disruptors I can use?

#3

Post by giantg2 »

Most of the paperwork for offers etc are standard forms that are used in the state. You can put in an offer and get a mortgage on your own. There is some overhead of learning it, but it's not difficult. If you do run into anything tricky (covenants, etc), most agents just tell you to talk to a real estate lawyer anyways. You should be able to save the 3% that a buyer agent typically charges.

Re: Ask HN: Buying house – any disruptors I can use?

#4

Post by f0e4c2f7 »

I suspect who you will eventually see move into this space is Airbnb. This may be some time off though and after they absorb hotel booking.

Another possible one is Zillow or one of the real estate apps. They seem less savvy than the Airbnb guys though so I'm not so sure about that.

Both of those seem like good places for innovation to me. One of the challenges you might find is that in both cases they are connecting to the legacy economy with phone calls rather than api's to get things that haven't been put on the internet yet (random bankers, listing that haven't been posted yet).

Those aren't insurmountable problems though.

As far as stuff you can use today, you can shop banks yourself rather than using a mortgage broker (obviously here you run the risk that the broker would have found the better rate).

In a way just using sites like Zillow or realtor is a big disruption. Think about how much more dependent on a real estate agent you would be if calling them on the phone or driving by a for sale sign was the only way to find a house.

Re: Ask HN: Buying house – any disruptors I can use?

#5

Post by 100-xyz »

sharemywin wrote: post #2

Ask if they do borrower paid compensation. you might also want to check a local credit union. You might also try looking for mortgage brokers and small banks in smaller towns in CA with lower property values. They might be willing to give you a break since your loan amount will look big to them. And they are used to doing loans for 4-6K Also make sure you get the inspections worked out upfront. Last thing you want to…

Appreciate your detailed pointers.

Re: Ask HN: Buying house – any disruptors I can use?

#6

Post by 100-xyz »

giantg2 wrote: post #3

Most of the paperwork for offers etc are standard forms that are used in the state. You can put in an offer and get a mortgage on your own. There is some overhead of learning it, but it's not difficult. If you do run into anything tricky (covenants, etc), most agents just tell you to talk to a real estate lawyer anyways. You should be able to save the 3% that a buyer agent typically charges.

Thanks. Because it involves such a large investment and affects are life, I want to understand and learn it - so problem with overhead of learning.

Will research into the paperwork.

Re: Ask HN: Buying house – any disruptors I can use?

#8

Post by pickle-wizard »

I've never heard of the buyer having to pay a mortgage broker a fee. When I bought my house I didn't have to pay them. The guy used gets a commission from the bank when he sales a mortgage.

However when I refinanced I didn't use a mortgage broker. I just went through my credit union.

Re: Ask HN: Buying house – any disruptors I can use?

#9

Post by 100-xyz »

pickle-wizard wrote: post #8

I've never heard of the buyer having to pay a mortgage broker a fee. When I bought my house I didn't have to pay them. The guy used gets a commission from the bank when he sales a mortgage. However when I refinanced I didn't use a mortgage broker. I just went through my credit union.

The commission paid by the bank is recouped by the bank by raising the interest rate slightly. One way or the other it's paid.
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