28 Jun

Is Denver Colorado in a Real Estate Bubble?

Now this may be a somewhat unpopular opinion among realtors – who are often all to eager to cheer the market on (after all, it’s how we make money)  but I think the Denver Colorado real estate market is, in fact, a real estate bubble.   It may not crash down in the same fashion as in 2007, but I think we’re in for some pretty significant price drops in the coming years.  Since my cat decided to go moth hunting at 4 in the morning, I’ve decided to make an article and video on the subject while I’m in that hazy, creative, half awake mode.

Why oh why would I, a real estate agent, suggest such a horrid thing?  Prices are up! The market is hot!  Yes, that all may be true, but I think there are some looming stats that can indicate a potential real estate bubble in the Denver metro area.

I would point you to the following articles that may give you some pause as a buyer in this crazy market .

Real Estate Growth Market Or Impending Bubble? How To Tell The Difference – Forbes, March 2 1017

Is Denver’s real estate market a bubble ready to burst? – Denver 7 Channel

Denver, northern Front Range real estate party ends in late 2019, new forecast predicts – The Denver Post

Here are 9 charts that can help the Fed spot the new housing bubble – Business Insider

Why It May Take Sixteen Years for Denver Millennials to Afford to Buy a Home – Westword

While these articles do make the important distinction that we do not have  a high number of sub prime mortgages (and resulting foreclosures) as we did during the 2007 crash, a major factor in my opinion that the Denver metro could be a real estate bubble is pretty simple-  the prices have soared a lot higher than the wages.   The Westword article above is pretty sobering for us millennial first time home buyers.

Another factor that I see coming that could make Colorado a real estate bubble is something that I don’t hear a lot of other realtors talk about – but I actually just took a class on it – and that’s our marijuana boom and future bust.  You’ll notice that shortly after Colorado ratified amendment 64, which legalized cannabis in the state, the housing prices soon shot up as well.  With  the 2016 election, California, Nevada, Massachusetts and Maine have all joined the ‘legal club’ that is going to cut largely into the influx of out of state Americans flocking to Colorado.

Again, this is just like, my opinion, man.    I do still think it’s a great time if you’re a seller – and selling now could likely put you near the top of the market if it’s a good option for you or you’re planning on moving.   However for buyers, it  may be worth waiting a little longer to see if the prices start to drop as the Denver post articles allude to.  Time will tell!

If you have any real estate questions or want to talk about buying or selling, give me a call at 720 260 0977.

Until next time,

Caleb

16 May

Is your real estate agent tech savvy or a dinosaur?

So, I am not going to lie, I should be paying attention because I am writing this post while sitting in on a class.   Today’s class is a computer class that goes over our local MLS software and how to make CMA’s with the software.   However… it’s getting pretty frustrating to watch.   It just amazes me, actually, when I see how many real estate agents are completely incompetent with technology in the year 2017.   Over half of the agents that are taking this computer class didn’t bring a computer. How are you supposed to learn software if you don’t follow along on your own computer? Prepare for today’s real estate agent rant.

This brings me to my larger gripe in general, is that a lot of real estate agents are dinosaurs when it comes to technology.  With the average age of a realtor being around 57 years old, I would say I might understand that some older people aren’t that tech savvy – but let’s be brutally honest here.  Computers aren’t a new thing.  If you’re 57 years old in 2017, that means you were born in 1960.  The first mass produced Apple computers and PCs came out in around the 80s.  You’ve had enough time to figure these things out.

is your real estate agent tech savvy, or are they a dinosaur?

If your real estate agent can’t navigate software in order to help you search homes, they are doing a disservice to you.  If they can’t properly pull comps from county assessor websites, they are doing a disservice to you.  If it takes them 6 hours to figure out how to draft and send in a virtual contract offer – especially with the speed and competitiveness of the Colorado market – They are doing a disservice to you.  If your real estate agent is truly the professional that they profess to be, they should be able to competently use the tools of the trade.  Back in the day the MLS was actually printed out in a book – but times have changed.

I don’t mean to be a jerk with this post, but I constantly see this through out the real estate industry – the reluctance of many a real estate agent to embrace the rapidly changing technology that has revolutionized real estate (and to be quite honest, puts a lot of real estate agents at risk of becoming irrelevant)  So, ask yourself – is my real estate agent tech savvy, or are they a technological dinosaur?  Along with the agent’s personality, morality and fiduciary commitment to you, their technical ability should be something that you as a buyer or seller consider heavily in your decision to hire them.

For example, as a seller – what does your real estate agent actually do to market for you?  Do they put the property in MLS, stick a couple of flyers in a box outside, and pray?    Wouldn’t you rather be more comfortable with a real estate agent that has the ability to create videos, a custom website for your listing, and have all the (professionally taken) photos posted not only on the MLS, but on Instagram, Facebook, Twitter and all the other major social networks?

Anyway, I guess I should stop ranting for the day, but I just think it’s something I have had on my mind for a while.

If you’re looking for a tech savvy Realtor in Colorado, feel free to give me a call.
Caleb

720 260 0977

13 Feb

Open houses are a waste of time for sellers

There, I said it.

Open houses are a waste of time for sellers.

“Why do you say that, Caleb?”  Well, it’s simple.  Here’s why:

What’s the most traditional marketing method when selling your house? The OPEN HOUSE! But, is it really all that useful? I don’t think so.

Open houses are really not very great – only 1-2% of homes even sell via an open house, and you are opening your home up to some potential danger.  Is a 2% chance worth the potential of damage to the home, theft, or something even worse happening?

Open houses really are just a marketing gimmick used by the listing agent in order to find new BUYER clients. That’s why we all have a sign in sheet and ask people to fill out their information upon entering. It’s not to sell YOUR house, but rather so we can get some new leads.  Most agents that are doing an open house are doing it, at least partially, with their own business interests in mind.  That’s why other agents from the same brokerage will hold an open house for your listing agent.

Open houses also will allow anybody into your home – they may be neighbors looking at your drapes, or even criminals that are casing out the home in order to burglarize it.  It happens every year in America where people have their home for sale – stuff gets stolen.  Firearms, jewelry, electronics and drugs (prescription or otherwise) are all open season in an open house.  Some thieves are seasoned and will come in groups, splitting up inside the house so the agent hosting the open house can’t keep track of both of them at once.  This is not even mentioning the potential of assault / rape / other much more heinous things that could happen.

If an open house is the only method of marketing that your agent provides, you may want to re-think your business relationship with them. A well made video tour, professional photography of the home and well planned social media exposure will go a LOT further in the effort to sell a house than holding an open house. In my opinion open houses are a waste of time for sellers.

My name is Caleb – I am a realtor in Parker, Colorado. You can contact me via my website

www.realestate.calebblock.net

www.homeinparkerco.com

 

26 Jan

Sold! Parker Colorado condo 17268 Waterhouse Circle

What a great location in Parker!  This 2 bed, 2 bath condo was under contract within a week – and sold for above asking price!  With easy access to the cherry creek trail, shopping in nearby Cottonwood, and nearby highway exits, this is a great area for commuters looking to live away from the hustle and bustle of Denver.   Very happy to help my client with selling this Parker Colorado Condo!

Sold price:  $242,000

subdivision:  Prairie Meadows

Parker, Colorado

Have you been thinking about selling your home in Colorado? Contact me.

Contact Caleb Block




19 Jan

Sell your Colorado home

Time to move?  Are you getting ready to sell your Colorado home?  Get in touch with me today and let me show you how I can market your home to get you the best possible sales price – and more importantly, get to the closing table!

Get in touch with me

Contact Caleb Block




12 Oct

Longmont Colorado Sold 1614 20th ave longmont Colorado

Hey everyone !

It’s a little behind schedule but I wanted to post a new property that I got sold up in Longmont!  Woohoo!

1614 20th ave Longmont Colorado

Sold:  $235,000

Congratulations to the seller!


20

 

 

 

 

 

 

 

 
1614 20th Ave Longmont, CO 80501
County: Boulder
Locale: Woodmeadow
Community:
Get
Homesnap Pro FREE
MLS#: 7879481 Status: Sold
List Date: 07/15/16 List Price: $335,000
Sold Date: 09/14/16 Sold Price: $335,000
Under Contract Date: 07/19/16
CDOM: 4 Appraised Value:
Concession Amount: $0
Status Conditions: None Known Original List Price: $335,000
Has HOA: No Tax ID: R0104902
INV Blackout Ends: Taxes: $1,908 (2015)
Title Company: First Integrity Title
Financial Terms: Cash, Conventional,
Earnest $: $5000, Title Company
Seller Type: Individual
Legal Desc: LOT 31 BLK 2 WOODMEADOW 5
Type: Detached Single Family Style: MultiLevel
Architecture: Contemporary Year Built: 1989
Construct Details: Model:
Time to Completion:
Builder Name: Richmond American Homes,
Heat Fuel: Electric, Gas
Heat Type: Forced Air
Cooling: Air ConditioningCentral
Other HVAC:
HVAC Detail:
Construction: Brick, Frame
Exterior: Brick, Wood Siding
Roofing: Composition Shingles
Recent: 09/14/2016 : Sold : U>
S
Selling Broker ID: 322610
Selling Office: RE/Max of Boulder
Sold Term: Cash
Concessions: None
Buyer Broker Paid By: Listor/Seller
Broker Closing Comments:
Total Beds: 3 Upper Sqft: PSF Above Grade: $238.10
Total Baths: 3 Main Sqft: 300 PSF Total: $149.89
Full Baths: 2 Lower Sqft: PSF Finished: $196.25
3/4 Baths: 0 Above Grade: 1,407 Bsmt Type: Full, Cellar
Half Baths: 1 Basement Sqft: 528 Subfloor: Crawl Space
1/4 Baths: 0 Total Sqft: 2,235 Bsmt Finished: No
Roughin:
Yes Finished Sqft: 1,707 % Fully Finished:
Other Finished SqFt: Bsmt Ceiling Height:
Other Finished SqFt Desc:
Measurement From: County Records Date Measured:
School District: St. Vrain Valley RE1J
Jr High/Middle: Longs Peak
Elementary: Northridge Sr High: Longmont
School of Choice:
Appliances: Dishwasher, Disposal, Dryer, Microwave Oven, Refrigerator (Kitchen), Smoke Alarm, Stove/Range/Oven, Washer
Flooring: Carpet, Tile Floor, Wood Floors
Interior Features: Cable Available, Eating Space / Kitchen, Five Piece Bath, Internet Access (Wired), Master Bath, Master Suite, Open Floor Plan,
Smoke Free, Vaulted
Smart Home Features:
Fireplaces: 1, Location(s): Family Room, Type(s): Wood
Exclusions: All personal property and furniture is excluded.
Site Type:
Beds Baths
Upper 3 2
Main 0 1
Lower 0 0
Bsmt 0 0

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13 Jun

3 keys to selling real estate

June already!  I can’t believe I am half way through my second year in the real estate business.  I have had the opportunity to help several sellers already  in the process of selling real estate, and here are my 3 biggest tips for home sellers.

  1.  The market dictates the price, not your mind.

I think one of the hardest things about selling your home is that it’s your home. It’s where you’ve made memories, for better or for worse.  It’s a special place to you, and all home sellers have a bit of emotion that wants the house to sell for x amount of dollars.  Now, in Colorado we’ve had quite the seller’s market so if your home isn’t falling apart at the seams and is in a lower price range, chances are it’s not going to be on the market for long.  However, the key word is the market.  Right now, everyone wants to move in Colorado.  Will that be the same scenario in 5 or 10 years?  Perhaps not, as markets ebb and flow just like waves on the ocean.  The best way to judge what your home’s market price will be is to get your agent to do a in depth CMA.

comparative market analysis
Comparative market analysis is an examination of the prices at which similar properties in the same area recently sold. Real estate agents perform a comparative market analysis for their clients to help them determine a price to list when selling a home or a price to offer when buying a home.
A good CMA is an invaluable tool to help you determine where to set your price.

2.  Get the home as clean as possible and take professional photos.

There’s a saying I have quickly become familiar with in real estate, and that is;  The way you live is not the way you show. This simply means that a home in “showing condition” is going to be a lot more minimalist and cleaner than it probably is in your day to day routine.  I know that some people maintain an impeccable clean home at all times, but we’re not all that nit picky (myself included!) However, if you’re serious about getting the home sold you should (if possible) remove all clutter from the house.  Getting a short term storage unit is a great idea in these situations.  The more open space in your home will show possible buyers the possibility of the space, rather than how much it can be cluttered.

The same goes for when it comes time to get pictures taken for the property.  The difference between homemade photos and a professional’s can be rather shocking – in terms of brightness and sharpness, and as well as being able to capture the depth and space of rooms.  Bland boring photos will turn a lot of people off from even coming to see the house in real life when they come across it on the MLS, Zillow or other home search sites.  Make sure your agent is one that will get professional photography (and in some cases video) of your home to put it in the best possible light.

3.  Be as flexible as possible with showing times.

flexible-showing-hours-selling-real-estateI understand this one can be tough, especially if you are still occupying the property you are trying to sell ( or worse, you have tenants in it!).  But, for you to be able to sell your home buyers have to be able to access it, see it, and make a decision.   I have been frustrated with buyers before who wanted to see a property, but due to showing restrictions and their job conflicting there was never a time the home was available to be shown.  Do remember when you’re selling a property your potential buyers have jobs just like you, and most of us have jobs that fit in the 9-5 time frame.  Be mindful of this and try to be flexible for daytime showings around lunch hour, and showings that might take place during your normal dinner hours (5-7 pm).  While I’m not suggesting you open up 24/7 for possible showings, you do need to be mindful that your potential buyers also probably have busy schedules and limited amount of time to view your home.

 

How can I help you with Colorado real estate?

 

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13 Jun

How does Real Estate Commission work?

Today, I am going to blog about one of the most despised words in the real estate world.  Hold on, here it comes:  Commission.  EEK!  Egads!  Now, for the few of you that haven’t run out of the room in terror, are you familiar with how a real estate commission works?  After all, we only fear what we don’t understand.  Let me try to demystify this for you so the word doesn’t seem so scary anymore!

Now, let’s define the word commission, I always think providing a definition is a solid starting point.

Simple Definition of commission

  • : a group of people who have been given the official job of finding information about something or controlling something

  • : an amount of money paid to an employee for selling something

  • : the act of committing a crime

Full Definition of commission

  1. 1a:  a formal written warrant granting the power to perform various acts or dutiesb:  a certificate conferring military rank and authority; also:  the rank and authority so conferred

  2. 2:  an authorization or command to act in a prescribed manner or to perform prescribed acts :charge

  3. 3a:  authority to act for, in behalf of, or in place of anotherb:  a task or matter entrusted to one as an agent for another

  4. 4a:  a group of persons directed to perform some dutyb:  a government agency having administrative, legislative, or judicial powersc:  a city council having legislative and executive functions

  5. 5:  an act of committing something <commission of a crime>

  6. 6:  a fee paid to an agent or employee for transacting a piece of business or performing a service; especially:  a percentage of the money received from a total paid to the agent responsible for the business

  7. 7:  an act of entrusting or giving authority

in commission

or

into commission

  1. 1:  under the authority of commissioners

  2. 2of a ship:  ready for active service

  3. 3:  in use or in condition for use

on commission

  1. :  with commission serving as partial or full pay for work done

out of commission

  1. 1:  out of active service or use

  2. 2:  out of working order

Thanks for the definition goes to Merriam Webster online.

 So, as you can see in the orange I’ve highlighted the specific definition we’re referring to here.  (although I am sure some frustrated buyers and sellers saw the crime definition and applied it to their agent!
A fact of life in the real estate industry is that all real estate agents and Realtors work on 100% Commission. Many buyers and sellers are confused by the commission set up and are not sure how it is set and who controls the commission. The reality here is that the seller is the one who sets the Commission in each transaction. The following picture is from the contract  called the exclusive right to buy or right to sell listing contract. This contract is between the buyer or seller and their agent and defines on the listing side how much commission will be paid to both a buyer’s agent, seller’s agent or a transaction broker.
In this contract, the total commission is set at 4%.  2.8% to the buyer's agent, and 1.2% to the listing agent.

In this contract, the total commission is set at 4%. 2.8% to the buyer’s agent, and 1.2% to the listing agent.

A very important point to remember if you are entering into an exclusive right to buy all right to sell agreement with an agent is that there is no standard commission percentage or amount that the commission must be. If they tell you otherwise they are not being truthful! Commission is always always always negotiable. Commonly in Colorado what you will see is a 2.8 % Commission for both the buying side agent and the listing agent who works for the seller. That means you were looking at a total commission expense of 5.6%. However this is always like I said, negotiable and you can discuss this with your agent about how much you feel is an appropriate payment. I have seen commissions of anywhere from 1%- 4%, with those higher commission rates often on vacant land that has been on the market for quite some time.

Section 7.2 of the Exclusive right to sell listing contract indicates how much of the total commission will be awarded to a buyer's agent or transaction broker.

Section 7.2 of the Exclusive right to sell listing contract indicates how much of the total commission will be awarded to a buyer’s agent or transaction broker.

 

 

 

 

While it may be beneficial in your mind to offer a very low commission to a buyer’s agent. you must remember that all agents are working solely on commission. While they should be loyal to their clients via a fiduciary duty, many agents may look at a listing that has an extremely low commission for a buyer’s agent and simply not show it to their clients. I advise sellers to at least offer a decent sum of money for a buyer’s agent so they will work hard to bring a buyer to the table. And on the flip side while you may be able to save some money by having your listing agent take a lower commission you should also keep in mind that marketing a property also takes money. Things such as professional photographs, professional staging of a home, gasoline expenses and time spent for open houses advance and other selling techniques are not free. If you find a Savvy agent who is up to speed with technology then you are much better served than somebody who will merely put the home in the MLS for you and then just hope that somebody comes along to buy it.

what-is-real-estate-commissionThus, this is the reason that many people choose to do a for sale by owner. They think they will easily be able to save around 6% of their sale price. And while they may save some money, the easy part is never easy.  Especially if you’re not familiar with the market you are in or how the home-buying/selling process works. I liken this to somebody who decides to fix the transmission on their car by themselves. Sure, you may be able to do it. However,  if you do not have the expertise of a professional, you may find that it is more of a headache and a anxiety-inducing event than you would reckon.  A real estate deal gone bad can carry significant legal and financial liabilities (and for this reason real estate agents carry errors and omissions insurance.)

I do my very best to work with clients and come to a point that we can both agree on in my payment when selling a home. I understand that the equity that you may have saved up through living in your home is very important to you and you do not want to see a single dollar of it lost – who would? This is why I work so hard for clients – because I know their money is means a lot to them, and marketing and selling a home is a full-time job in and of itself. Just remember that you can always negotiate the cost of a real estate commission with your agent to something you are comfortable with!

How can I help you with Colorado real estate?

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07 Jun

Colorado real estate glossary

Colorado Real estate glossary:  Please use this glossary of real estate terms if you are ever unclear on what something means.  If you need help with real estate in Colorado, please feel free to contact me today!

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Real Estate Glossary

A

Amenity: a feature of the home or property that serves as a benefit to the buyer but that is not necessary to its use; may be natural (like location, Woods, water) or man-made (like a swimming pool or garden).

Amortization: repayment of a mortgage loan through monthly installments of principal and interest; the monthly payment amount is based on a schedule that will allow you to own your home at the end of a specific time period (for example, 15 or 30 years).

Annual Percentage Rate (APR): calculated by using a standard formula, the APR shows the cost of a loan; expressed as a yearly interest rate, it includes the interest, points, mortgage insurance, and other fees associated with the loan.

Application: the first step in the official loan approval process; this form is used to record important information about the potential borrower necessary to the underwriting process.

Appraisal: a document that gives an estimate of a property’s fair market value; an appraisal is generally required by a lender before loan approval to ensure that the mortgage loan amount is not more than the value of the property.

Appraiser: a qualified individual who uses his or her experience and knowledge to prepare the appraisal estimate.

ARM: Adjustable Rate Mortgage; a mortgage loan subject to changes in interest rates; when rates change, ARM monthly payments increase or decrease at intervals determined by the lender; the Change in monthly payment amount, however, is usually subject to a Cap.

Assessor: a government official who is responsible for determining the value of a property for the purpose of taxation.

Assumable Mortgage: a mortgage that can be transferred from a seller to a buyer; once the loan is assumed by the buyer the seller is no longer responsible for repaying it; there may be a fee and/or a credit package involved in the transfer of an assumable mortgage.

B

Balloon Mortgage: a mortgage that typically offers low rates for an initial period of time (usually 5, 7, or 10) years; after that time period elapses, the balance is due or is refinanced by the borrower.

Bankruptcy: a federal law whereby a person’s assets are turned over to a trustee and used to pay off outstanding debts; this usually occurs when someone owes more than they have the ability to repay.

Borrower: a person who has been approved to receive a loan and is then obligated to repay it and any additional fees according to the loan terms.

Building Code: based on agreed upon safety standards within a specific area, a building code is a regulation that determines the design, construction, and materials used in building.

Budget: a detailed record of all income earned and spent during a specific period of time.

C

Cap: a limit, such as that placed on an adjustable rate mortgage, on how much a monthly payment or interest rate can increase or decrease.

Cash Reserves: a cash amount sometimes required to be held in reserve in addition to the down payment and closing costs; the amount is determined by the lender.

Certificate of Title: a document provided by a qualified source (such as a title company) that shows the property legally belongs to the current owner; before the title is transferred at closing, it should be clear and free of all liens or other claims.

Closing: also known as settlement, this is the time at which the property is formally sold and transferred from the seller to the buyer; it is at this time that the borrower takes on the loan obligation, pays all closing costs, and receives title from the seller.

Closing Costs: customary costs above and beyond the sale price of the property that must be paid to cover the transfer of ownership at closing; these costs generally vary by geographic location and are typically detailed to the borrower after submission of a loan application.

Commission: an amount, usually a percentage of the property sales price, that is collected by a real estate professional as a fee for negotiating the transaction.

Condominium: a form of ownership in which individuals purchase and own a unit of housing in a multi-unit complex; the owner also shares financial responsibility for common areas.

Conventional Loan: a private sector loan, one that is not guaranteed or insured by the U.S. government.

Cooperative (Co-op): residents purchase stock in a cooperative corporation that owns a structure; each stockholder is then entitled to live in a specific unit of the structure and is responsible for paying a portion of the loan.

Credit History: history of an individual’s debt payment; lenders use this information to gouge a potential borrower’s ability to repay a loan.

Credit Report: a record that lists all past and present debts and the timeliness of their repayment; it documents an individual’s credit history.

Credit Bureau Score: a number representing the possibility a borrower may default; it is based upon credit history and is used to determine ability to qualify for a mortgage.

D

Debt-to-Income Ratio: a comparison of gross income to housing and non-housing expenses; With the FHA, the-monthly mortgage payment should be no more than 29% of monthly gross income (before taxes) and the mortgage payment combined with non-housing debts should not exceed 41% of income.

Deed: the document that transfers ownership of a property.

Deed-in-Lieu: to avoid foreclosure (“in lieu” of foreclosure), a deed is given to the lender to fulfill the obligation to repay the debt; this process doesn’t allow the borrower to remain in the house but helps avoid the costs, time, and effort associated with foreclosure.

Default: the inability to pay monthly mortgage payments in a timely manner or to otherwise meet the mortgage terms.

Delinquency: failure of a borrower to make timely mortgage payments under a loan agreement.

Discount Point: normally paid at closing and generally calculated to be equivalent to 1% of the total loan amount, discount points are paid to reduce the interest rate on a loan.

Down Payment: the portion of a home’s purchase price that is paid in cash and is not part of the mortgage loan.

E

EEM: Energy Efficient Mortgage; an FHA program that helps homebuyers save money on utility bills by enabling them to finance the cost of adding energy efficiency features to a new or existing home as part of the home purchase.

Equity: an owner’s financial interest in a property; calculated by subtracting the amount still owed on the mortgage loon(s) from the fair market value of the property.

Escrow Account: a separate account into which the lender puts a portion of each monthly mortgage payment; an escrow account provides the funds needed for such expenses as property taxes, homeowners insurance, mortgage insurance, etc.

F

Fair Housing Act: a law that prohibits discrimination in all facets of the home buying process on the basis of race, color, national origin, religion, sex, familial status, or disability.

Fair Market Value: the hypothetical price that a willing buyer and seller will agree upon when they are acting freely, carefully, and with complete knowledge of the situation.

Fannie Mae: Federal National Mortgage Association (FNMA); a federally-chartered enterprise owned by private stockholders that purchases residential mortgages and converts them into securities for sale to investors; by purchasing mortgages, Fannie Mae supplies funds that lenders may loan to potential homebuyers.

FHA: Federal Housing Administration; established in 1934 to advance homeownership opportunities for all Americans; assists homebuyers by providing mortgage insurance to lenders to cover most losses that may occur when a borrower defaults; this encourages lenders to make loans to borrowers who might not qualify for conventional mortgages.

Fixed-Rate Mortgage: a mortgage with payments that remain the same throughout the life of the loan because the interest rate and other terms are fixed and do not change.

Flood Insurance: insurance that protects homeowners against losses from a flood; if a home is located in a flood plain, the lender will require flood insurance before approving a loan.

Foreclosure: a legal process in which mortgaged property is sold to pay the loan of the defaulting borrower.

Freddie Mac: Federal Home Loan Mortgage Corporation (FHLM); a federally-chartered corporation that purchases residential mortgages, securitizes them, and sells them to investors; this provides lenders with funds for new homebuyers.

G

Ginnie Mae: Government National Mortgage Association (GNMA); a government-owned corporation overseen by the U.S. Department of Housing and Urban Development, Ginnie Mae pools FHA-insured and VA-guaranteed loans to back securities for private investment; as With Fannie Mae and Freddie Mac, the investment income provides funding that may then be lent to eligible borrowers by lenders.

Good Faith Estimate: an estimate of all closing fees including pre-paid and escrow items as well as lender charges; must be given to the borrower within three days after submission of a loan application.

H

HELP: Homebuyer Education Learning Program; an educational program from the FHA that counsels people about the home buying process; HELP covers topics like budgeting, finding a home, getting a loan, and home maintenance; in most cases, completion of the program may entitle the homebuyer to a reduced initial FHA mortgage insurance premium-from 2.25% to 1.75% of the home purchase price.

Home Inspection: an examination of the structure and mechanical systems to determine a home’s safety; makes the potential homebuyer aware of any repairs that may be needed.

Home Warranty: offers protection for mechanical systems and attached appliances against unexpected repairs not covered by homeowner’s insurance, overage extends over a specific time period and does not cover the home’s structure.

Homeowner’s Insurance: an insurance policy that combines protection against damage to a dwelling and Is contents with protection against claims of negligence or inappropriate action that result in someone’s injury or property damage.

Housing Counseling Agency: provides counseling and assistance to individuals on a variety of issues, including loan default, fair housing, and home buying.

HUD: the U.S. Department of Housing and Urban Development; established in 1965, HUD works to create a decent home and suitable living environment for all Americans; it does this by addressing housing needs, improving and developing American communities, and enforcing fair housing laws.

HUD1 Statement: also known as the “settlement sheet,” it itemizes all closing costs; must be given to the borrower at or before closing.

HVAC: Heating, Ventilation and Air Conditioning; a home’s heating and cooling system.

I

Index: a measurement used by lenders to determine changes to the Interest rate charged on an adjustable rate mortgage.

Inflation: the number of dollars in circulation exceeds the amount of goods and services available for purchase; inflation results in a decrease in the dollar’s value.

Interest: a fee charged for the use of money.

Interest Rate: the amount of interest charged on a monthly loan payment; usually expressed as a percentage.

Insurance: protection against a specific loss over a period of time that is secured by the payment of a regularly scheduled premium.

J

Judgment: a legal decision; when requiring debt repayment, a judgment may include a property lien that secures the creditor’s claim by providing a collateral source.

L

Lease Purchase: assists low- to moderate-income homebuyers in purchasing a home by allowing them to lease a home with an option to buy; the rent payment is made up of the monthly rental payment plus an additional amount that is credited to an account for use as a down payment.

Lien: a legal claim against property that must be satisfied when the property is sold.

Loan: money borrowed that is usually repaid with interest.

Loan Fraud: purposely giving incorrect information on a loan application in order to better qualify for a loan; may result in civil liability or criminal penalties.

Loan-to-Value (LTV) Ratio: a percentage calculated by dividing the amount borrowed by the price or appraised value of the home to be purchased; the higher the LTV, the less cash a borrower is required to pay as down payment.

Lock-in: since interest rates can change frequently, many lenders offer an interest rate lock-in that guarantees a specific interest rate if the loan is closed within a specific time.

Loss Mitigation: a process to avoid foreclosure; the lender tries to help a borrower who has been unable to make loan payments and is in danger of defaulting on his or her loan.

M

Margin: an amount the lender adds to an index to determine the interest rate on an adjustable rate mortgage.

Mortgage: a lien on the property that secures the Promise to repay a loan.

Mortgage Banker: a company that originates loans and resells them to secondary mortgage lenders like: Fannie Mae or Freddie Mac.

Mortgage Broker: a firm that originates and processes loans for a number of lenders.

Mortgage Insurance: a policy that protects lenders against some or most of the losses that can occur when a borrower defaults on a mortgage loan; mortgage insurance is required primarily for borrowers with a down payment of less than 20% of the home’s purchase price.

Mortgage Insurance Premium (MIP): a monthly payment -usually part of the mortgage payment – paid by a borrower for mortgage insurance.

Mortgage Modification: a loss mitigation option that allows a borrower to refinance and/or extend the term of the mortgage loan and thus reduce the monthly payments.

O

Offer: indication by a potential buyer of a willingness to purchase a home at a specific price; generally put forth in writing.

Origination: the process of preparing, submitting, and evaluating a loan application; generally includes a credit check, verification of employment, and a property appraisal.

Origination Fee: the charge for originating a loan; is usually calculated in the form of points and paid at closing.

P

Partial Claim: a loss mitigation option offered by the FHA that allows a borrower, with help from a lender, to get an interest-free loan from HUD to bring their mortgage payments up to date.

PITI: Principal, Interest, Taxes, and Insurance – the four elements of a monthly mortgage payment; payments of principal and interest go directly towards repaying the loan while the portion that covers taxes and insurance (homeowner’s and mortgage, if applicable) goes into an escrow account to cover the fees when they are due.

PMI: Private Mortgage Insurance; privately-owned companies that offer standard and special affordable mortgage insurance programs for qualified borrowers with down payments of less than 20% of a purchase price.

Pre-Approve: lender commits to lend to a potential borrower; commitment remains as long as the borrower still meets the qualification requirements at the time of purchase.

Pre-Foreclosure Sale: allows a defaulting borrower to sell the mortgaged property to satisfy the loan and avoid foreclosure.

Pre-Qualify: a lender informally determines the maximum amount an individual is eligible to borrow.

Premium: an amount paid on a regular schedule by a policyholder that maintains insurance coverage.

Prepayment: payment of the mortgage loan before the scheduled due date; may be Subject to a prepayment penalty.

Principal: the amount borrowed from a lender; doesn’t include interest or additional fees.

R

Radon: a radioactive gas found in some homes that, if occurring in strong enough concentrations, can cause health problems.

Real Estate Agent: an individual who is licensed to negotiate and arrange real estate sales; works for a real estate broker.

REALTOR®: a real estate agent or broker who is a member of the NATIONAL ASSOCIATION OF REALTORS®, and its local and state associations.

Refinancing: paying off one loan by obtaining another; refinancing is generally done to secure better loan terms (like a lower interest rate).

Rehabilitation Mortgage: a mortgage that covers the costs of rehabilitating (repairing or improving) a property; some rehabilitation mortgages – like the FHA’s 203(k) – allow a borrower to roll the costs of rehabilitation and home purchase into one mortgage loan.

RESPA: Real Estate Settlement Procedures Act; a law protecting consumers from abuses during the residential real estate purchase and loan process by requiring lenders to disclose all settlement costs, practices, and relationships.

S

Settlement: another name for closing.

Special Forbearance: a loss mitigation option where the lender arranges a revised repayment plan for the borrower that may include a temporary reduction or suspension of monthly loan payments.

Subordinate: to place in a rank of lesser importance or to make one claim secondary to another.

Survey: a property diagram that indicates legal boundaries, easements, encroachments, rights of way, improvement locations, etc.

Sweat equity: using labor to build or improve a property as part of the down payment.

T

Title 1: an FHA-insured loan that allows a borrower to make non-luxury improvements (like renovations or repairs) to their home; Title I loans less than $7,500 don’t require a property lien.

Title Insurance: insurance that protects the lender against any claims that arise from arguments about ownership of the property; also available for homebuyers.

Title Search: a check of public records to be sure that the seller is the recognized owner of the real estate and that there are no unsettled liens or other claims against the property.

Truth-in-Lending: a federal law obligating a lender to give full written disclosure of all fees, terms, and conditions associated with the loan initial period and then adjusts to another rate that lasts for the term of the loan.

U-V

Underwriting: the process of analyzing a loan application to determine the amount of risk involved in making the loan; it includes a review of the potential borrower’s credit history and a judgment of the property value.

VA: Department of Veterans Affairs: a federal agency which guarantees loans made to veterans; similar to mortgage insurance, a loan guarantee protects lenders against loss that may result from a borrower default.

Ask Caleb a Question
Allow me to run a report on your home and give you details of what the home’s value is, or help you in your home search!

07 Jun

Realtors in Colorado

caleb-block-realtor-headshotColorado is one of the hottest destinations in the United States!  Have you been looking for Realtors in Colorado?  Welcome!
I am a Colorado native and I have lived in several different areas of the Colorado front range – including Boulder, Golden, Denver and Parker Colorado.  As a CU Boulder graduate I enjoyed my college days under the towering flatirons.  This is my second year in the real estate business, and already I have helped both buyers and sellers purchase homes, vacant land, and I am currently in the process of finishing my first spec (speculation) custom built house!  I love the challenge and excitement that comes with the real estate industry and I would love to assist you with your needs.  You can reach Caleb at 720 260 0977.

realtors-in-coloradoIf you are looking for horse property in Colorado, Check out my mother, Nan Galligan.  She has been a licensed realtor for over 30 years and specializes in equestrian properties.  So saddle up and set your sights west.  Contact Nan at 303 841 0692 for more information on Colorado horse properties today!

 

 

 

Let us know how we can help you with real estate in Colorado!

 

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