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The hazards of a long-distance home purchase

Finding and buying a home in a city you know is one thing, but making a move thousands of miles away? What could possibly go wrong?

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My wife and I just moved from one neighborhood to another in the same city. Eight miles total from one door to the other. Nearly killed me. But imagine moving from a Boston suburb to a small town in Texas. Or from California to Florida. Now you’ve got a whole new set of challenges. Finding and buying a home in a city you know is one thing, but making a move thousands of miles away?

What could possibly go wrong?

‘I feared we would be sleeping in the bus station’

A couple of years ago, Marilyn Santiesteban and her husband, Kent Portney, sold their suburban Boston home of 30 years and bought a home in College Station, Texas, for new jobs. Their Massachusetts home was in a desirable neighborhood and was under contract in less than three weeks. In the meantime, they flew to Texas, found a house and signed a purchase agreement.

An inspection revealed that the Texas house needed a new roof.

“No big deal; that‘s an easy negotiation,” Santiesteban says. “Except with this seller. She didn’t want to pay for any of it and wanted the insurance company to cover the cost as there was some hail damage.”

Meanwhile, with hopes fading for their new home in Texas, Santiesteban and Portney faced a deadline on the sale of their home in Boston.

“She kept dragging her heels, and we couldn’t close the deal. I feared we would be sleeping in the bus station,” Santiesteban says.

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Buying a home sight unseen

Back in Boston preparing for the move, Santiesteban and Portney faced a long-distance dilemma: move to Texas without a place to live or trust their Texas real estate agent and buy a home before even seeing it.

“We ended up buying another house sight unseen. We love it, by the way,” she says. But Santiesteban is quick to add, “I don’t want to move again for at least five years.”

Making a long-distance move requires a good bit of timing, and perhaps luck. There are few shortcuts when buying a home, and skipping a proper inspection is probably not one you want to take. If they had rushed the process, Santiesteban and Portney would have been stuck owning a house with a run-down roof — an expensive repair.

The homebuying process has changed

Alessandro Miglio and his wife, Eileen, bought a house in Richmond, California, in March 2008. That’s right, just as the real estate market crashed. Their home’s value was immediately underwater and stayed that way for seven years.

“During that time, we had both our children, and we never imagined we would be leaving,” Miglio says. “I’m originally from Miami, though, and the family pull proved too strong. It got harder to leave each time we visited, and the cost of living [in California] was becoming unsustainable.”

The couple waited until the East Bay real estate market recovered to make the cross-country move. But they were surprised to find that since their last home purchase, and as a result of the housing crisis, the mortgage process had changed considerably.

“Apparently, we bought our [Florida] home just in time for new loan regulations to kick in, so scrutiny on our application was higher and took longer than we had experienced in the past,” Miglio says.

“At one point, just days before we were supposed to close, the underwriter discovered that the proceeds from our California sale technically went to a trust we had set up in our own names in California,” he says. “The underwriter required a copy of the trust, and that was in the movers’ storage back in Concord, California. We had to beg our lawyer to make a full copy of it and pay her $300 just to appease the underwriter.”

How to make a long-distance home purchase work

Additional paperwork delays because of more stringent mortgage regulations made the process even more stressful for the Miglios. His advice for others planning a cross-country move?

“Have good selling and buying agents, even if it means eschewing your brother-in-law who just got his real estate license,” he says, and stay in constant contact with all parties involved in the transaction.

“I call it ‘New York mode,’” he says. “We lived in Manhattan for a few years, before California, and the pace and expectations there are understandably higher. I developed a ‘grinder’ mentality there that stayed with me when I left. I tend to be annoyingly diligent in ensuring everyone is doing their jobs in a timely fashion. It’s like herding cats with so many moving parts, though.”

To reduce the stress of a cross-country move, Miglio recommends going with a reputable mortgage lender that has good reviews as well as soliciting advice from friends and family about their positive lending experiences.

“Oh, and good beer,” he adds.

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Hal Bundrick is a staff writer at NerdWallet, a personal finance website. Email: hal@nerdwallet.com. Twitter: @halmbundrick.

This article originally appeared on NerdWallet.

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