Crabgrass is easy to control, you have to get on a pre-emergent program and stick with it. It will help with most if not all common annuals, not just crabgrass. More info here:

http://lawniac.com/conquering-crabgrass-and-annual-weeds

Maybe you can still plant some ryegrass and do a renovation next August? Too late for Kentucky Bluegrass.

There are a few things going on. Likely prior to moving in the lawn was abandoned (not watered, mowed, or fertilized for months). That would leave thin or dead spots. Then when you moved in and started to water, the summer annual weed seeds, like crabgrass, had both water and sunlight necessary for germination.

The "good practices" ways to prevent crabgrass are to 1) grow a dense lawn that shades the soil and helps prevent seedlings from taking root; and 2) water properly so that the weed seeds don't germinate. You grow a dense lawn by reseeding fescue and rye in the fall and/or growing Kentucky bluegrass because it usually gets dense by itself. Watering properly is more complicated, but not that hard to figure out. Here's more on that.

Watering: Deep and infrequent is the mantra for watering. This is for all turf grass all over the place. Deep means 1 inch all at one time. Put some cat food or tuna cans around the yard, and time how long it takes your sprinkler(s) to fill all the cans. Memorize that time. That will be the time you water from now on. My hose, sprinkler and water pressure takes 8 full hours to fill the cans. Your time will likely be less. I like gentle watering. As for watering frequency, that depends on the daytime air temperature. With temps in the 90s, deep water once per week. With temps in the 80s, deep water once every 2 weeks. With temps in the 70s, deep water once every 3 weeks. With temps below 70, deep water once a month. Note that you have to keep up with quickly changing temps in the spring and fall. This deep and infrequent schedule works in Phoenix and in Vermont, so it should work for you. The reason for deep and infrequent is to grow deeper, more drought resistant roots and to allow the soil to dry completely at the surface for several days before watering again. If it rains, reset your calendar to account for the rainfall.

Thanks for the comments so far. The watering advice was interesting as most around here just set their sprinklers to go every morning for a couple hours.

I assume it's too late to lay down grass seed now? Should I use any crabgrass preventer or should I wait on that as well since most has died with a couple cold days last week? Thanks again!