Buying a Home

First-Time Homebuyers in Denver: Common Regrets to Avoid

Avoid Regret with a home purchaseMore than one in five first-time homebuyers report having at least one major regret with their purchase. We don’t want first-time homebuyers in Denver to have to deal with the same dissatisfaction.

Buying a house can be a fun and rewarding experience without disappointment. The best way to avoid any big mistakes that end up costing you frustration or money down the line is to learn from the most common regrets of those who came before you.

Here’s our list of the most common regrets of first-time homebuyers. Listen up, because avoiding these mistakes will go a long way to ensuring that your experience is everything you want it to be.

Common Regrets of First-Time Homebuyers in Denver

  •  62 percent of first-timers report that they outgrew their home faster than they thought they would. These buyers wish they had done a better job of predicting the amount of space they would need as their families and assets grew. 

  • 40 percent say they ultimately feel they paid too much for their first home.

  • 38 percent wish they had budgeted more accurately for the costs of maintaining a home. More than a third of first-time homebuyers say they underestimated all the little expenses that go into repairs and maintenance.

  • 34 percent would search around and negotiate more to find a better mortgage rate if they could do it over again. Many feel they are paying too much. “We should have put more money down upfront” is another common regret that’s highly related.

  • 25 percent say they ended up not liking the surrounding neighborhood they moved into.

These are just a handful of the pitfalls...

Denver Home Insurance Advice for New Buyers: Key Do's and Don'ts

Home Insurance PitfallsShopping for a new home is an exciting time. Hopefully, your search is inspiring you to envision a bright future for you and your family in the house of your dreams.

It's not a time when you necessarily want to start thinking about things that could go wrong down the line, but that's just a necessary part of being a savvy home shopper and owner.

Securing the right kind of home insurance is absolutely essential to having a good experience with your property investment.

Here are a handful of the key do's and don'ts when it comes to Denver home insurance:

Don't...

Bundle for convenience -- bundling with other types of insurance MIGHT save you some money, but that doesn't mean it's the right choice. It might be right for you, but don’t automatically assume it without doing your due diligence.

Pay for land -- Protect the buildings and structures you own, but don't be talked into insuring the land they sit on.

Forget to protect additional items -- special items, like jewelry, that are contained within your home will require additional insurance. Don't forget to protect these valuable as well.

Do...

Check for special rates -- good credit, your age, or certain features of your home could all earn you discounted rates, so do ask any prospective home insurance provider.

Shop around -- get multiple quotes to ensure you get competitive rates and services from the provider you ultimately choose.

Take note of limits -- if you have limited time to file a claim after an incident, you need to be aware of the restriction. Ask for info about limits and get it in writing.

Photograph damage...

Required Documents for Mortgage Qualification

What do I need for a home loanUnless you're paying entirely in cash upfront, you will need to get a mortgage to buy a new home in Denver.

To qualify for a mortgage, you're going to authenticate the income and tax information in your application by providing a list of documents.

Do you have everything you need? Check out the list of the required documents to double check:

  • Signed disclosures
  • The social security card belonging to each person involved in the purchase
  • A list of home addresses for all properties lived at in the last two years
  • Two to three months of bank statements
  • Two previous pay stubs
  • Proof of down payment
  • Previous two years' W-2 forms
  • Previous two years' tax returns
  • The purchase contract (if it's available)
  • Details of your employment

In certain circumstances, a borrower may also have to provide:

  • Evidence of other income (child support, etc.)
  • Divorce settlement papers
  • Balance sheets (if self employed)
  • Gift letter (if, for instance, parents are providing the down payment)
  • Evidence of other debt (student loans, credit card debt, etc.)

Some Other Requirements

  1. After completing your mortgage application, you will need to provide consent for the lender to proceed. This gives the mortgage provider permission to investigate your application.
  2. After all required documents have been submitted and the application is completed and submitted, the lender is required to give you a Loan Estimate within three days. This estimate will summarize your monthly payments and loan terms.
  3. Before approving the loan, the...

5 Tips for Buying a New Construction Home in Denver

New Construction TipWith the intense competition for existing homes in Denver, more and more buyers are looking to new home builders for a solution.

While building a new construction home in Denver does solve one problem, it also presents a few unique challenges that buyers need to be aware of.

Here are some things you should be aware of before you decide to go the new construction route.

Incomplete Phases

In some cases, new construction homes are part of larger development projects that won't be complete for years. If you're on a short timeframe for moving into a new home, these situations won't work for you. Make sure your new home would be move-in ready within a reasonable amount of time.

Construction

There are different definitions of "move-in ready." If you're going to be expected to live in a home surrounded by dirt, machinery, and loud construction noise for the first year, you need to be aware of it. This can be the case sometimes when one new construction home is part of a larger development that is still in progress.

Model Home vs Real Home

Builders are excellent at creating model spaces that appeal to buyers. However, sometimes the actual home doesn't appeal to the buyer quite as much as the model did. Make sure your attraction to the space and design goes beyond the professional staging and finishing that only applies to the model.

Included Items

The model home may have had tons of high-end appliances, but that doesn't mean they'll be included in your new construction. Find out what's included and discuss your needs with the builder.

Completion Date

Make sure you get the developer's projected finish date down in writing. This...

Homebuyer Checklist: 10 Things to Check Before Falling in Love with a House

What to watch out forWhen you’re in the market for a new home, It’s all too easy to fall in love with a property at first glance and forget about all the potential challenges.

Buying a home, you have to think about the long-haul as well as your first impression. Here’s a list of 10 items that you should check off for every new property you look at in Denver. If you complete this checklist every time, you have a much better chance of ending up with a home that keeps you happy for years to come.

Permits

Research to find out whether or not the property has had any work done on it and whether or not it was properly permitted

HOA Restrictions

Determine if the property is part of a home owner's association. If so, research any rules or restrictions that apply.

HOA Stability

If there is an existing HOA in place, is it financially healthy and able to enforce its own restrictions?

Parking Rules

If there are frustrating restrictions on vehicle parking, that can be a deal breaker.

Future Area Plans

Are there any construction projects planned for the area surrounding the home that would impact its future value?

HVAC Condition

Hire a home inspector to verify that the property's air conditioning and heating systems are working properly

Roof Life Expectancy

The inspector should also be able to tell you the condition of the roof and how long it's expected to last before requiring replacement or significant repair.

School Zoning

Research the school district and local elementary, middle, and high schools to judge their suitability for your children.

Pet Restrictions

Are there...

5 Things You Need to Buy a Home in Denver

What do I need to buy a home“What do I need to buy a house?” It’s a simple question that real estate agents hear often from first-time homebuyers.

The question may be simple, but the answer can get confusing quickly. That’s why it’s especially important for home shopping neophytes to work with a seasoned Denver real estate agent when embarking on one of the biggest investments of their lives.

There are several key steps involved in purchasing a home, and it’s easy for first timers home to completely overlook one or more.

In this blog, we’ll quickly recap all of the important items that must be checked off your list before you can close on a new home. Of course, there will be additional requirements from your mortgage lender. But, in this article, we’ll just stick to the key factors that pertain to the amount of money you need. 

Mortgage Pre-Approval

If you're not able to buy your home with cash upfront, then you'll need pre-approval on a mortgage. Contact a mortgage lender to discuss the steps involved in obtaining pre-approval.

Earnest Money

Earnest money is a measure of good faith that is typically paired with a sales contract. This money acts as proof to the seller that you have an "earnest" intent to buy their home.

Money for Down Payment 

Many down payments range from 3 to 5 percent of the home's sale price. The mortgage lender can help you determine the appropriate down payment.

Money for Closing Costs

Typically, 1 to 4 percent of the amount of the mortgage loan should be set aside for closing costs. Sometimes closing costs will be negotiated within the sales contract. 

Money to Hire an...

Buy a Home in Denver to Avoid Rapidly Rising Rent

If you’ve been looking for reasons to buy a home in Denver, the rapidly rising rents in the area should be all the motivation you need.

 

Multiple reports all agree -- rent is on the rise in Mile High City. One recent report found Denver to have the fastest rising rent rate in the nation, and another found it to have the third fastest rate growth, topped only by Portland and San Francisco. The stats are clear – rent is bad and it’s only getting worse.

 

The Yardi Matrix report is the latest sign that local renters should be looking to buy. Due to available home mortgage deductions and the long-term sustaining value of local homes, buying would be an attractive option even if rent wasn’t getting so ridiculous.

 

The word around the industry is that it is very unlikely the Fed will raise interest rates in the near future. If mortgage rates remain low, that’s even more reason to switch from renting to buying.

 

More Reasons to Buy a Home in Denver

 

A recent program unveiled by Fannie Mae only requires a three percent down payment. Other lenders like Wells Fargo are also introducing new programs that have extended lock periods, which give home buyers protection from rising rates.

 

Local housing experts are predicting that home values will be higher a year from now, which means it’s better to act quickly.

 

If you are a first-time home buyer or a move-up home buyer looking to avoid the crazy rent situation, contact the Denver real estate experts at the Neir Team. Alex and Stacy Neir will help you find the right neighborhood and the right home for your needs.

 

Call 720.280.3004 or 720.935.4399 or visit our Denver CO real estate listings page today to get...

You’ve Decided to Buy a New Home, Now What?

Congratulations, you have decided to buy a new home. That decision ushers in a flood of emotion ranging from excitement to anxiety.

In order to help with the later, we have created a home buying guide that identifies the steps in purchasing a new home.

Weather you’re a first time home buyer or seasoned owner, we feel our road map helps organize and simplify the process.

There are quite a few steps when purchasing a home. The graph below is a visual representation of the home buying process. 

It all starts with hiring a professional real estate broker to guide you through the process. You will want to hire a broker that is an expert in the areas you are considering a purchase. More: Denver Real Estate Broker Duties, Home Purchase 

Once you select to real estate professional to help facilitate your home purchase you will want to get pre-qualified/approved for your new home loan if you require financing. Selecting a lender is a very important step. Get referrals from people you trust. Then compare the personality’s you relate to, with a good faith estimate.  

Next up, making an offer. What makes a good offer? 

Next you will want to review all of the Colorado Real Estate Disclosures with your Broker.

After your offer has been accepted the next major hurdle is the general inspection. The general inspection gives...

Denver Real Estate Broker Duties, Home Purchase

What is the job of a real estate broker and what makes a good broker? These are two very good questions if you are considering hiring a real estate professional to help with the purchase of real estate.

There are four categories of skills that need to be managed by a competent real estate broker. These categories include; Guidance, Responsive, Accounting and Loyalty.

Guidance is an important attribute to a smooth and successful real estate transaction. Some of the areas of broker guidance center around the following:

  • Frame the property search around what’s most important to you
  • Recommend lenders for pre-approval that help determine an affordable price, strengthen your offer and lead to a faster closing
  • Search the MLS and network with other brokers daily to find new properties that match your criteria
  • Preview properties, schedule and accompany you to showings
  • Analyze comparable property values and advise you on current market conditions
  • Structure and prepare your offer, review disclosures and laws and deliver the contract
  • Negotiate skillfully on your behalf and promote clear and frequent communication among all parties
  • Review title commitment, recommend home inspectors, facilitate lender approval, insurance coverage, and recommend attorneys or tax professionals as needed
  • Accompany you on final walk-through

Responsiveness is the next area of management and includes:

  • Acting in good faith at all times
  • Adhering to your instructions
  • Returning all calls and emails promptly, keeping you informed
  • Closely tracking dates and deadlines

Accounting for money and information is extremely important.

  • Receive, deliver and monitor all earnest money deposits
  • Receive and deliver all documents in a timely manner
  • Review final settlement statements to ensure accuracy

...

Denver Real Estate Inspection, What Should I Have Done?

Denver Real Estate Inspection, what should I have done?

This is another question we get from every one of the clients we help. The short answer is, you should inspect for everything that is a concern to you. Now that is a pretty vague answer so I’ll expand.

There are plenty of inspections that can be conducted for a home you are working to purchase. Here is a list of some of the inspections offered in Colorado. This is not a complete list, it’s simply a list of the most common.

  • General Home Inspection
  • Sewer Line
  • Radon
  • Structural
  • Termite
  • Asbesto
  • Methamphetamine
  • Mold
  • Waste Pump
  • Soil Condition
  • Lead Based Paint

We typically recommend that a buyer, at the bare minimum, conduct a general inspection, sewer line inspection and radon inspection.

The general inspection is conducted by are third party selected by the buyer. Most real estate brokers have a list of referrals for inspectors so don’t worry if you don’t have an inspector in mind.

The general inspection typically last between 3 and 5 hours, depending on the size and age of the home. During the general inspection everything that can be visually accessed is inspected. The inspector will then generate a detailed report explaining the items inspection and the repairs needed.

This report gives you the actual condition of the home so that you can determine if the home is worth buying. 

...

What Makes a Good Offer When Purchasing Real Estate?

What Makes a Good Offer When Purchasing Real Estate?

This is a question we get asked by each and every client with work with. A good offer is one that gets accepted. That is the simplest explanation, however that can be a tricky undertaking.

It may be perceived, especially on the buy side, that a good offer is an offer at the lowest price. This is not the case as the market determines the price. Real estate typically trades hands at a price that other buyers paid for similar improvements (real estate). Now there are situations called distressed sales where prices fall outside this economic fact, however that will not be discussed here.

To make a good offer your real estate broker should first determine market price for the property you are interested in (subject property). This in not always, and often isn’t the list price of the home. Your broker finds the market price by gathering sales of comparable properties as close to the subject property as possible. Then through the art of adjustment, market value is determined.

Next your real estate broker will want to consider how long the subject property has been on the market. This is a good indication as to the willingness of the seller to negotiate on the price. The general rule is that the longer the property has been on the market the more negotiable the seller is likely to be.

Next it is a good idea for your broker to check public records to see is the seller has a recorded mortgage and how much is still owed on the home.  This is another clue as to the willingness of the seller to negotiate. If the seller has the home listed at the amount they owe, the likelihood of them negotiating is lower.

The last thing to consider when determining what makes a good offer is the location of the property. You have heard the adage  - Location, Location, Location. This is a fundamental truth in real estate; the best location commands the highest price. Therefore the best offer may be significantly...

Standard Colorado Real Estate Disclosures, What Are They?

Most Colorado real estate transactions have a standard set up disclosures that are provided by the seller and disclose important facts about the home being sold. Below you will find a list of the most common disclosures. This is not an all-inclusive list, as some real estate firms require other disclosures.

Sellers Property Disclosure – This is an important disclosure from the seller as to the condition of the home and systems within. This form has 13 sections that range from the structural condition to environmental condition. This form should be analyzed thoroughly as it will give you clues on where to pay special attention with the inspections.

Lead Based Paint Disclosure – This disclosure will only be present if the home was built prior to January 1st, 1978. This form discloses any knowledge the seller has about the presence of lead passed paint in the home.

Square Footage Disclosure – This is a disclosure that is made to the Buyer and Seller with regard to the square footage being represented for marketing purposes. The disclosure requires the listing broker to disclose where the square footage measurement comes from.

Closing Instructions – This form identifies who will be conduction the closing and the fees associated with the closing services. The form also includes instructions for the closing company and how conduct the closing.

Source of Water Disclosure – This form discloses the water provider for the property with contact information.

...

What is the Title Insurance Commitment?

The title insurance commitment is an insurance policy that is purchased by the seller that insures the property against loss due to title defects, liens or other matters related to title.

When reviewing your title commitment it is important to examine Schedule B, Section 2, Exceptions. This is the section that lists the items that will not be insured against.

More often than not, this section contains utility easements, recorded neighborhood plat maps etc. that are normal and don’t pose a liability for the buyer. However, there are transactions where serious exceptions are present that need to be cleared prior to closing on the property. Your real estate broker should offer guidance on involving a lawyer or title expert when issues with the title commitment arise.

...

Is a sewer line inspection worth the money?

Roots are the main problem with sewer lines in ColoradoSewer line inspections in the state of Colorado are important.  Why you ask?  The answer is because a homeowner is legally responsible for the maintenance of the sewer “lateral” (the sewer line) from their home to the sewer main at the center of the street.  This is the case in any home or neighborhood.  Everyone has their own.  The biggest sewer line risk that you take if you don’t have the lateral inspection done before you buy a home is that it can be a very expensive repair once it’s too late.

If you are a first-time home buyer, your realtor should highly suggest that you ask for a sewer line inspection before purchasing.  This type of inspection is usually not something buyers think about.  We all get traditional home inspections, and sewer lines are a complete after thought, if it thought about at all.  If the home you are looking to purchase is an older home, a sewer line inspection is truly one of the most important inspections to conduct.

Some underground sewer pipes are metal, some are clay.  The problem with the later type is they are not sealed at the joints.  Another type of material that was used in really older home was a tar paper called Orangeburg pipes.  These pipes disintegrate and collapse over time.  If your inspector finds Orangeburg, they absolutely must be replaced!  One last, somewhat unique scenario on an older house might be that it was built prior to city sewers and relied on a cesspool.  After cities...

What Worries You About Buying a Home?

Home buyer worries are completely natural when you are taking such a big step.  Any good realtor can give you home buying tips and help alleviate fear when buying a home.  Here are several worries that one might have when making such a big purchase:

Home Buying Concerns

Buyer concern – Fluctuating mortgage interest rates

Rates fluctuate all the time.  The key is to lock in at a rate that you are not only comfortable with, but that is the best your mortgage broker can get for you.  Your realtor can make suggestions as to the best mortgage broker to work with, one the will help guide you thought the process and offer exemplary customer service.

Buyer concern – Not finding a home for sale you like

You never want to rush into buying a home.  Sometimes the process can be quick, and sometimes it can take months.  Never settle!  If there is ever a feeling that you are not seeing the right homes for your needs, have a meeting with your realtor to go over exactly what you want in your home.  The right home is out there, you simply need to patient and ready when it presents itself.

Buyer concern – Not qualifying for a mortgage

This is a huge home buyer worry.  As far as the numbers go, before you think about buying a home, you really want to have your ducks in a row. Make sure you get pre-qualified with your mortgage broker. This serves multiple purposes. First by getting prequalified your mortgage broker will go over the cost of the financing and give you an estimate on your monthly payment. Good to know before you start looking, as you want to stay within your budget. Second, once you find the right home the offer will need to be accompanied by the...

Competitive Offers

Competing offersWhen a real estate market is experiencing low inventory and highly motivated sellers like the current one in Denver, the outlook can appear rather bleak for buyers itching to place an offer. Homes are going under contract within hours of going on the market and the majority are receiving multiple offers before weeding them down to a single winner. In a market like this, the best advantage a buyer has is to be competitive and formulate the most appealing offer possible. This is one of the most important home buying tips we can advise upon and here are a few ways to create your most competitive offer.

The importance of being prepared to act quickly cannot be stressed enough. Not only does that mean submitting an offer as soon as you can, but it also means being prepared before you even start the house hunt. Talk to your lender to find out how much you can afford and what your price range is. A seller will have greater peace of mind with your offer if they know your offer has financial backing. Then, hammer out exactly what you are looking for in a home. This includes your must-haves and then the items you can be a little bit more lenient with. The best type of competitive offer is one that has the financial support behind it and is for a house you know you’ll love.

Bidding wars are not uncommon in a market like this. With multiple offers coming in, anxious buyers will escalate their offer in order to ensure the house is theirs. If you find yourself in such a war, know what your limit, or “walk-away”, number is. In the heat of the moment or the thrill of the hunt, many buyers tend to push the sales price up too high for their financial security and end up paying more than they want, or can. Do not fall into the adrenaline  trap and pay more for...

Risks of Radon in Colorado

How Radon enters the homeMost people who have bought or sold a home in Colorado have heard of radon and that detecting and mitigating the gas is incredibly important. But very few people actually know what radon is and are aware of the disastrous effects it can have on the body. So when people ask, “is radon dangerous”, the answer is a very resounding “yes.”

In order to properly inform yourself about the risks and dangers associated with radon, it is important to first understand what it is and the effects it can have on the human body. Radon is a radioactive, cancer-causing gas that seeps up through the ground. It is a result of radioactive breakdown of uranium in water, soil, and rocks. Unbeknownst to most, radon is the second leading cause of lung cancer in the United States, according to the Surgeon General, behind smoking. Radon in Colorado is quite prevalent and something that needs to be tested any time one buys a home.

How to stop RadonTo address the radon risk, a home inspector will set up a radon test in the basement of a home for two days. This test consists of a charcoal canister that absorbs any radon in the area. After those two days, the canister is sent away for testing and a lab measures how much radon gas the charcoal absorbs. If the levels are above the required limit, 4 picocuries per liter, than a radon mitigation system must be installed to bring that level down to a safe amount. Surprisingly, one in every 15 homes is found to have elevated radon levels and radon in Colorado is one of the biggest concerns.

If you are thinking of buying a home,...

Home Buyer Tips in a Seller’s Market

Get your offer acceptedIf you have been paying any attention at all to the current real estate market in Denver, than you know that it is strongly in favor of sellers. With inventory astonishing low and more buyers than available houses, people looking to sell their home have all of the power. And when it comes to buying a home in this market, it is crucial to heed any home buying tips and to be consciously aware of anything that might turn a seller off of your offer. Below are a few things to avoid when  buying a home in this crazy Denver market.

Do not make a “low-ball” offer, even to just see what will happen. We may not be psychic, but we can already tell what will happen; you will be ignored and passed over. Some listings are receiving dozens of offers within hours of going on the market and many are well above asking price. If you submit an offer below the listed price, sellers have full authority to pass right over it. This is common sense home buying and one of the most important home buying tips. Make a fair, clean, and hopefully, contingent-free, offer.

Once you have submitted an offer that the seller has accepted, do not think that the house is yours. There is still the whole process of inspections, loan conditions, and other important deadlines that can make or break a deal. A vital, and rather courteous, home buying tip applies to the inspection. If you are buying a home and get back the inspection report, do not ask the seller to fix frivolous and pointless repairs. Some items need to be tended to, but if your demands are outrageous, ridiculous, and tedious, the sellers have every right to back out of the deal and find another buyer. And in this market, another buyer is sure to come along. Be sure to consult with your realtor about the inspection items and remember that...

First Time Home Buyer Now What

First Home PurchaseOne of the greatest, and most terrifying, things in life is deciding to purchase your first home. There are so many things to consider, from location, to the number of bedrooms, bathrooms, square feet, and of course, the price. As a first time homebuyer, there are a hundred things you need to consider, but we are here to offer you some crucial home buying advice.

Many first time homebuyers feel some sense of entitlement, fueled by down-payment assistance programs aimed at these real estate novices. There are certain criteria that may qualify or disqualify you for this assistance and it is important to go into the buying process completely aware of what you are getting yourself into. For instance, you may think you know your household income, but did you know that if your 18-year-old son or daughter lives with you and has a job, their income must be included? This amount can tip you over the qualifying limit and suddenly, you are no longer eligible for assistance. There are must criteria you must fill, and if you fail to fulfill just one, you might not have as much help as you thought.

Aside from some government assistance in the form of down-payment programs, first time homebuyers still need to qualify for a mortgage. This means a steady income, decent credit, reputable employment, and some assets. You need to make sure that even before you start to look for a home, you are aware of what you can afford and do not set your sights too high. It is also important to talk to a seasoned and knowledgeable loan officer, one who can accurately tell you payment deadlines and taxes.

There are many things to keep in mind when it comes to purchasing your first home. This process is not easy, but it is key to understand as much as you can before you start, don’t ignore...

How to Get the Most From Your Realtor

Hire a realtorWhen it comes to buying and selling a home, arguably the most important decision is choosing which realtor to work with. Hiring an expert to purchase or sell such a large asset is always smart business. When it comes to hiring an agent, it is important to know how to get the most from your realtor. Once you have found a realtor that can cater to your needs, there are a few tips to keep in mind that will make this whole process easier.

In order to get the most from your realtor, be loyal. Realtors will work their hardest for you if they know that you are committed to them. Do not go to an open house, call “For Sale By Owner” listings, or respond to an ad and “forget” to mention that you are working with a realtor. The reason to hire a broker in the first place is because they have your best interests in mind and help you when it comes to getting the best price and getting an offer accepted, etc. If you seem disloyal to your realtor, they won’t have incentive to work hard for you.

Select a Realtor with a personality that you click with. There are numerous negotiations that happen over the course of a real estate transaction. If you and your realtor aren’t on the same page, it can be a struggle finding the most beneficial course of action. There is plenty to be concerned about during a real estate transaction. It is not helpful worrying about whether your realtor understands your point of view.

Know what you want. If you hire a realtor and have no idea what you want, you are bound be a little fusturated. To get the most from your realtor, give them a list of what you are looking for so that your realtor can quickly and efficiently find what you are looking for. Working with a buyer’s agent is extremely beneficial, but only if your agent...