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        <title>Denver Real Estate Blog</title>
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        <description>Denver real estate topics including local metro Denver community news and events.</description>
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            <guid>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-where-to-start-part-1.html</guid>
            <link>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-where-to-start-part-1.html</link>
            <author>bruce@bruceswedal.com (Bruce Swedal)</author>
            <title>Denver CO First Time Home Buyer Series – Where to Start (Part 1)</title>
            <description> <![CDATA[ 
You have made the decision and home ownership is in your future. In this series of articles geared towards the first time home buyer we will help you to understand the process of buying a home and working with a Realtor. Whether you choose my team to assist you achieve your goals or not these articles can also assist you through the process.

The first step is a vital: If you want to purchase your dream home you need to establish your budget, unless you are paying cash you need to speak with a lender and establish the financing which you qualify for. This will give you vital information for your home search including the maximum you qualify for, interest rates and expected payments. These will serve as a guide for your home search.

The metro Denver region offers many types of homes and a $200,000 home is different in both features and condition from a $250,000 home. Just as a $300,000 home offers differences from a $250,000 home. Location, lot size and type of residence play roles within the different price ranges. Knowing the financing you qualify for, the amount and terms will help you in setting expectations and understanding the type of home you want to ultimately buy.

While evaluating what type of loan you qualify for and your purchase power the lender will also need to check your credit report. Occasionally you will discover there are errors on it which may need to be corrected if there is time. Most people do not check there credit that often so they are unaware of what may be there. Knowing what is on your credit report will give you the opportunity to make corrections or in some cases taking a period of time to clean up any needed situations.

Here is a place online where you can check your credit - AnnualCreditReport.com  which is where you can receive the free annual report provided by the Federal Trade Commission Guidelines. Another good source would be with the lender who is qualifying you for financing who could also assist with interpreting the report.

Credit scores can and do make a difference in the mortgage you qualify for. The scores needed vary daily and by the type of financing. Many factors go into it and individual items listed within the report can also have an effect.

Next in the Denver CO First Time Home Buyers Series  The Differences Pre-Approval vs. Pre-Qualification and Its Effect On Negotiations (Part 2)
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            <pubDate>Mon, 06 Sep 2010 07:44:50 -0600</pubDate>
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            <guid>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyers-series-the-differences-pre-approval-vs-pre-qualification-and-its-ef.html</guid>
            <link>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyers-series-the-differences-pre-approval-vs-pre-qualification-and-its-ef.html</link>
            <author>bruce@bruceswedal.com (Bruce Swedal)</author>
            <title>Denver CO First Time Home Buyers Series – The Differences Pre-Approval vs. Pre-Qualification and Its Effect On Negotiations (Part 2)</title>
            <description> <![CDATA[ 
It is natural for Denver CO first time home buyers to want to jump right into the house hunt without really planning out the path to become a home owner. Denver CO First time home buyers will spend hours and even days online looking at homes and plugging the recent interest rates into the available mortgage calculators.

Most people (approximately 95%) purchasing a home require some sort of financing. That makes it very important when buying a home to understand the process for obtaining one. It is also important to know what the difference is between a pre-approval and a pre-qualification.

When a seller receives an offer for their home they automatically understand that there is a desire on the part of the buyer to purchase it. What is not as clear to them is  Can the Buyer Actually Complete the Purchase? Sellers want to see that buyers have been screened by a professional lender to make sure that if the seller agrees to the buyers offer it will actually result in a sale. The method used to show the seller that the buyer has been screened and can actually purchase the home is a pre-qualification in the form of a lender letter submitted with any offers.

During a pre-qualification the borrower provides financial documentation and information to the lender which is then analyzed, a credit report is pulled and everything reviewed. At that point the lender will determine what type of financing the buyer qualifies for to issue an applicable letter.

During a pre-approval process all the same steps as in the pre-qualification process are completed. In addition the lender will require financial documents from the borrower to verify assets.

What is the big difference?

A letter of pre-qualification just lets the seller know that the buyer reviewed some general information with a lender. A pre-approval letter shows the seller that the buyer has gone through additional steps to ensure the financing is secure and thus it carries more weight.&nbsp;

One additional step which could be taken to give even more weight to a buyers offer is to gain a mortgage approval to submit with an initial offer. A mortgage approval shows that the lender received supporting financial documentation and an underwriter has reviewed and approved the loan application pending the buyer finding the right property which they would like to purchase. Sellers understand the current lending environment is tough and give due consideration to the most qualified home buyer. This is one extra step to make that impression.

Documentation you will need for your loan application.


W2s, 1099s and tax returns (for past 2 years)

Bank Account Statement  Any checking and savings accounts.

Statements from any additional financial accounts (pensions, retirement, CDs)

Recent pay stubs (minimum last 30 days)&nbsp;


Next up in the Denver CO First Time Home Buyer Series  What Goes Into a Home Payment (Part 3)
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            <pubDate>Mon, 06 Sep 2010 07:44:49 -0600</pubDate>
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            <guid>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-what-goes-into-a-home-payment-part-3.html</guid>
            <link>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-what-goes-into-a-home-payment-part-3.html</link>
            <author>bruce@bruceswedal.com (Bruce Swedal)</author>
            <title>Denver CO First Time Home Buyer Series – What Goes Into a Home Payment (Part 3)</title>
            <description> <![CDATA[ 
In this article we are going to break down and discuss in a simple fashion the different aspects of a house payment:

Mortgage Payment = Principal + Interest + Property Taxes + Property Insurance + HOA Dues (If They Apply) + Mortgage Insurance (If It Applies)

When purchasing a home, most metro Denver CO home buyers will finance the purchase with a mortgage they have to make payments on. Those payments will usually consist of part principal and part interest.

Interest  The amount allocated to interest each month varies based upon the interest rate and term of the loan.

Principal  A typical loan will have a portion of the monthly payment allocated to reducing the principal balance which allows the loan to eventually be paid off.&nbsp;

An Item of Note: Many home buyers will see interest rates quoted in news papers or online websites. The rates quoted there are typically given for prime borrowers that have excellent employment history, excellent credit and a good history of making payments. Interest rates which individuals receive will depend upon their individual situation and history.

Property Taxes in Colorado are determined partly upon the mill rate in the particular county and then combined with the assessed value of the property. Property taxes will vary widely based upon the county of location and the value of the property.

Another factor of property taxes included assessments for school districts which are included into the property tax amount.

Property Insurance  A lender will require that hazard insurance be carried on a home which they have a lien on at all times. The insurance will protect both the lender and the borrower from unforeseen damage to the property caused by natural events, fire, theft, storms and additional provisions provided by the individual policy. Lenders require minimum coverage levels and will need to approve the policy you choose. Premiums for property insurance vary greatly based upon home value, provisions and carrier.

When obtaining quotes for property insurance the first place to check would by with your auto insurance carrier (if you are happy with their service). Insurance carriers often give package discounts when multiple policies are carried with the same company. Saving money is a good thing so whether staying with your auto carrier or going with a new carrier it is a good idea to keep package discounts in mind.

Mortgage Insurance  There are lending options available which allow the home buyer to obtain financing with less than a 20% down payment. When taking advantage of these loans the lender will often require mortgage insurance which will protect the lender in case of default on the loan. The premium is paid by the home buyer. In FHA loan situations the insurance is called FHA Mortgage Insurance. In conventional financing the insurance is called Private Mortgage Insurance.&nbsp;

Home Owners Association Fees  Within the metro Denver CO real estate market there are many properties which are in areas that require residents to belong to a local homeowners association. The association is there to enforce rules designed to maintain and increase property values, maintain common areas and make improvements. There is no opt-out. To own a home and live in the area membership in the HOA is required and agreed to by the purchaser in closing on the home. Each HOA will have its own set of rules and bylaws for the community. It is a very good idea to read these carefully so you are aware of them. The amount of the HOA fees will vary between communities and the amenities those communities offer their residents. In general the more amenities offered the higher the HOA fees.

A quick summation: Figuring a hypothetical monthly payment on a $200,000 home with a 5% interest rate, amortized over 30 years and a 20% down payment.


Principal and Interest = $858.91

Property Tax = $120.00 (estimated)

Property Insurance = $80 (estimated)

HOA Fees = $38

Home Payment = 1096.91


Next up in this first time home buyer series is Projecting Funds You Will Need to Close (Part 4).
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            <pubDate>Mon, 06 Sep 2010 07:44:48 -0600</pubDate>
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            <guid>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-projecting-the-funds-needed-to-purchase-a-metro-denver-co-hom.html</guid>
            <link>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-projecting-the-funds-needed-to-purchase-a-metro-denver-co-hom.html</link>
            <author>bruce@bruceswedal.com (Bruce Swedal)</author>
            <title>Denver CO First Time Home Buyer Series – Projecting the Funds Needed to Purchase a metro Denver CO Home (Part 4)</title>
            <description> <![CDATA[ 
This article will break down the closing costs one should be familiar with when purchasing a metro Denver CO home.

Down Payment  The amount of down payment required will vary based upon financing or what the home buyer wants to put down. There are programs I know which have zero down payment from the buyer and some can go to 20% of the purchase price or more. Basically if a buyer purchases a $200,000 home and makes a 10% down payment, the down payment amount would be $20,000.

Costs of Closing  Traditionally called closing costs, these fees include any fees tied to processing the mortgage in addition to fees charged by the title company to process the closing. The specific fees charged by the lender vary and will typically include a origination fee, credit report charge, application fee and processor fee. Specifics on lender fees should be obtained during the loan application process.

Colorado allows for the purchaser to negotiate the sellers assistance in paying their closing costs. Most lenders will allow the seller to contribute 3% towards the home buyers closing costs which should cover the buyers closing costs in nearly all situations. Some lenders will allow for more than 3% if needed. Negotiating with the seller to pay the buyers closing costs helps the buyer because they can bring less funds to closing and have more available when they move into their new home.

Your professional Realtor and lender can guide you through these tricky situations and negotiate these provisions.

There are also additional items which will need consideration.

Earnest Money Deposit  Earnest money demonstrates good faith upon the part of the home buyer and shows the seller that the offer they are making is serious. Here in Colorado when purchasing a property there has to be consideration for the agreement to be valid. That consideration is a good faith earnest money deposit towards the purchase of the home. Upon acceptance of the agreement to purchase the seller is agreeing to remove the home from the market for a period of time pending closing showing their good faith. In return the buyer shows good faith through an earnest money deposit. The amount of earnest money is always a negotiable point and varies from property to property, but a good rule of thumb is to expect an amount of approximately 1% of the value of the property being purchased.

The earnest money check will be cashed and deposited into an escrow account pending closing only when both buyer and seller have agreed to the purchase and sale of the property in question. The entity holding the earnest money is generally the title company which will conduct the closing, but in some cases will be the real estate company of the listing agent.&nbsp;

Within the agreement there are many dates such as the inspection deadline which protect a home buyers earnest money. As long as the parties operate within the parameters of the agreement should the transaction fail to close the earnest money is then to be refunded to the purchaser. Should parties not operate within the protective dates and deadlines the earnest money could be at risk. Earnest money is credited towards the purchase of the property when the transaction closes.

Home Inspection Fees  After there you have an agreement in place for the purchase of a home and prior to the deadline for completing inspections it is a good idea to have a professional home inspector come through the property in order to make an assessment of its condition. The purpose of the assessment will be to identify and potential problems that may currently exist with the property in order for the home buyer to make a more informed decision on the purchase and in some cases negotiate for repairs with the seller.

The cost of a general home inspection in the metro Denver CO region will vary based upon the inspector and the size of the property. Different home inspectors have different rates and we have several recommendations on our service provider page. The costs will generally be $200 and up with special testing such as for Radon being extra (tests for Radon run appx $100).

Any negotiations with the seller for repairs should be completed prior to the inspection objection deadline agreed to by the parties.

Professional Appraisal  If the property is being financed the lender will require a professional appraisal to verify the value of the property that will collateralize the loan. Depending upon the lender this can be an upfront cost to the home buyer or in some cases it can be paid in closing as part of closing costs. Appraisal fees vary upon the type of financing and typically run between $375 and $450.

Pre-Paid Items  These also contribute to the costs associates with closing. They will vary based upon many factors and payment for these can be negotiated from the seller. Items which are pre-paid include the first year of property insurance for the home which insurance companies require be paid in advance, setting up an annual escrow for future property insurance and an escrow to pay future property taxes. Pre-paid interest on the loan that runs from the closing date through the end of the month which is why closing closer to the end of the month decreases a buyers closing costs. Also with less than a 20% down payment there may be an upfront mortgage insurance payment.

Next up in the Denver CO First Time Home Buyer Series  The Tools You Need for A Successful Denver CO Home Buying Experience (Part 5).
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            <pubDate>Mon, 06 Sep 2010 07:44:47 -0600</pubDate>
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            <guid>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-the-tools-you-need-for-a-successful-denver-co-home-buying-exp.html</guid>
            <link>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-the-tools-you-need-for-a-successful-denver-co-home-buying-exp.html</link>
            <author>bruce@bruceswedal.com (Bruce Swedal)</author>
            <title>Denver CO First Time Home Buyer Series – The Tools You Need for a Successful Denver CO Home Buying Experience (Part 5)</title>
            <description> <![CDATA[ 
Note: this is a series of articles to educate Denver CO first time home buyers on what they can expect during the process of finding and purchasing their first home. Make sure to read the others in the series as they contain important information.

Insider Secrets? Yes, there are some those which come into play when hunting for your first metro Denver CO home. In this article you will find many insider secrets which are beneficial when searching for your first home and using internet search tools.

One of the primary factors in real estate is location, location, location and one of the newest advanced tools is searching for homes through an interactive map search tool. This allows a home buyer to easily factor in location when searching for a home.&nbsp;

Home buyers seeking their next home will usually define a location where they want to live with boundaries, many times using streets and highways to define directional edges to their preferred location. The interactive map search tool allows home buyers to focus right into that area and see the homes available laid out on a map grid.

Another nice tool for home buyers to utilize is the satellite or street view of Google Maps. By plugging in an address you can look at the home and neighborhood from a satellite view or tour through the neighborhood utilizing the street view which can help save time and gas by easily spotting homes which back to busy streets or areas that are not kept up.

Property Alerts  This is a fantastic tool which allows home buyers to input their home criteria into a tool that actively monitors the market for new listings and sends those new listings which match the criteria as soon as they come on the market. If your criteria changes you can modify the alerts to match.

Benefits of Property Alerts:


Saves time

Proactive search approach

Searches only for properties that match your criteria

Can search by map

Secure account with unique id and password

Request viewings online

Save your favorites

Modify search criteria anytime

Register for your metro Denver home search account


Next up in the Denver CO First Time Home Buyer Series  Deciding to Use a Realtor (Part 6)
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            <pubDate>Mon, 06 Sep 2010 07:44:46 -0600</pubDate>
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            <guid>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-deciding-to-use-a-realtor-part-6.html</guid>
            <link>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-deciding-to-use-a-realtor-part-6.html</link>
            <author>bruce@bruceswedal.com (Bruce Swedal)</author>
            <title>Denver CO First Time Home Buyer Series – Deciding to Use a Realtor (Part 6)</title>
            <description> <![CDATA[ 
Yes, a real estate agent is a sales person, but a Realtor is more than that. A real estate professional which has an agency agreement with you is there to represent and advocate for your best interests and educate you on tactics that are in your best interest. A Realtor has the education and industry knowledge along with a fiduciary responsibility to advocate on your behalf which should make a Realtor the most important tool in your belt.

In most transactions there are two real estate agents involved. One agent is there representing and advocating on behalf of the seller and the sellers best interests. The other is there to represent and advocate the home buyers best interests. Imagine how one-sided the transaction would be if the only agent involved were the sellers agent&hellip;. The only professional in the transaction would be looking out for the sellers best interests. Who would be looking out for yours?

Home buyers need professional representation in real estate transactions to help them avoid the dozens of pitfalls they could fall into without being armed with their own Realtor.

Some things to consider during your first time home purchase with your buyers agent.&nbsp;

1 - Real Estate transactions are not easy, they are multi-faceted and complex.

There are dozens of small pieces during every real estate transaction and the success or failure of the transaction can hinge upon any one of them. Colorado real estate law is immense and complex with dates, deadlines with a vast amount of paperwork and contracts. A professional Realtor has the education and experience to avoid the pitfalls and guide the transaction to a successful closing. Working with the right Realtor gives you a sense of security and an opportunity to learn your role through the process of buying your home.

Colorado real estate law allows for a real estate agent to function in two distinct ways when working with a home buyer. When representing a buyer the agent can operate in the role of a buyers agent which allows them to be an advocate for the home buyer, promoting the home buyers best interests and operating in a fiduciary manner. The agent can also operate as a transaction broker where the agent advocates for neither party and only facilitates the transaction.&nbsp;

To make the distinction simpler to see, the transaction broker could be seen as fulfilling the role of umpire in a football game impartial with only the interest of making sure the rules are followed. The buyers agent on the other hand would equate to the role of a teams head coach by strategizing, planning and calling plays to create the best outcome for the home buyer and in another sense win.

A buyer agency relationship will have a specific time frame that it covers and will create a confidentiality agreement between the home buyer and the Realtor. In this relationship any information shared with your Realtor will not be shared with anyone else without your permission.

Throughout my experience as a Realtor I have seen many instances as I negotiate on behalf of my clients with other sellers or buyers they oftentimes will reveal information which is detrimental to their own negotiations. In their minds they are being friendly but a good negotiator will pick up on those signs and pick them apart at the negotiating table.&nbsp;

Home buyers and sellers will also focus in on the same thing in every transaction. That is the sales price. Though that is important there are many other terms that also have a large impact on the successful outcome of your home purchase. There is a listing agent advocating and protecting the interests of the seller during the transaction and there clearly should be a experienced and knowledgeable Realtor there to protect you.

2  Realtors should leave emotions out of it.

Purchasing a home for anyone is an emotional experience and for a Denver CO first time home buyer those emotions run even higher. Because of this, home buyers need a Realtor involved that can keep their emotions in check and be focused on home buyer goals. This also helps the home buyer stay focused on the important things and gives them a person with whom they can remain grounded in pursuit of their goals.

An ideal example of a time when emotions can run high is during multiple offer situations. Lets face it, people tend to be competitive and sometimes want to win at all costs. Because of that desire it is easy to lose focus when competing for the purchase of a home. In times like this when emotions run high good buyers agents will keep your goals in mind and provide objective guidance so you can remain on track to achieve your initial goals.

3  New home purchase? Your agent can assist!

A myth perpetuated by new home builders is that a buyers agent is not needed for a new home purchase. Entering into a real estate transaction with a home builder un-represented is not a good idea. The contracts builders use for the sale are customized by the lawyers and agents representing the best interests of the builder. They are not representing your interests as your buyers agent would. Not being represented by your own Realtor when purchasing a new home can end up costing you big. New home builders also pay the buyers agents fees  you do not.

4  Having specific knowledge and experience to know what to expect.

Experienced Realtors have already fought the fights and know what the expectations are during a transaction which keeps their clients from being taken advantage of. If youre looking for homes in an area outside your budget an experienced Realtor can let you know that an adjustment needs to be made to either the location or the projected budget.

When sellers come back requesting items out of the ordinary such as an extraordinary amount of earnest money or exceptional lengths in the proving financial approval, your Realtor can alert you to the common industry practices and assist you with recommendations on how the situation should be handled.

Situations like these make quality, experienced Realtors representing buyers worth their weight in gold. Buyers normally do not compensate their agents either. There is no better deal than having a buyers agent represent your best interests and looking out for potential pitfalls when you are purchasing your first, second or fifteenth home.&nbsp;

Feel free to call us anytime with any questions you may have in the home purchase process.

A few testimonials from clients:

James and Karen F&nbsp;- Bruce and his team have assisted us through the purchase of three homes and another for our son. His experience and professionalism throughout the transaction made the process easy while keeping our goals at the forefront. Delightful to work with and gave us great comfort knowing that he was on our side.

Dan and Teresa H - We were referred to Bruce by a friend who he helped in the past. We were facing some unique issues and Bruce guided us through them long before we even decided to purchase a home. Once we did decide to purchase, he taught us what we needed and guided us step by step through the process. When we found the right home he negotiated aggressively to get us what we needed. His assistance during those hectic times made him the only realtor we will ever use and we recommend him to everyone we know. The friend who referred us to Bruce got a huge thank you!

Mike T - WooHoo! We have the home we never thought we could and it is all thanks to Bruce and his team. During the process we were impressed at how well Bruce personally stayed in touch. He also listened to our situation, our goals and helped us achieve them. Two Thumbs Up!

Next up in the Denver CO First Time Home Buyer Series  Understanding the Real Estate Contract (Part 7)
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            <pubDate>Mon, 06 Sep 2010 07:44:44 -0600</pubDate>
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            <link>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-understanding-the-real-estate-contract-part-7.html</link>
            <author>bruce@bruceswedal.com (Bruce Swedal)</author>
            <title>Denver CO First Time Home Buyer Series – Understanding the Real Estate Contract (Part 7)</title>
            <description> <![CDATA[ 
Understanding the process of writing an offer and having that offer accepted is a very important part of the home buying process. There is no binding agreement for the purchase until the contract is drawn up, agreed to and signed by all parties. Most home buyers when they start the process are excited about finding the right home, having their Realtor prepare the offer and getting it in front of the sellers for signatures. Until all signatures are in place there is no agreement. (Anything expected or agreed to in the purchase of a home should be clear and in writing)

Once the buyers and sellers have signed the agreement it becomes legally binding on all parties with both parties having specific performances and deadlines which need to be met.

What is it that makes Colorado contracts legally binding?

I have had times where people have thought that just making an offer makes it legally binding. An offer by itself is not legally binding there are other components or actions which need to be taken for it to be binding.

What is an offer? The best way for a Denver CO first time home buyer to extend an offer is in writing utilizing the services of a Realtor to prepare it. Verbal offers in the state of Colorado are typically not taken seriously and legal agreements such as this should always be in writing to avoid misunderstandings. Your Realtor can prepare all the documents required to make an offer and present them on your behalf.

What is acceptance? For an offer which has been extended to be binding it has to be accepted by the counterpart to the offer and notification of acceptance must be given. Accepting an offer means accepting it in its entirety. Should a single term not be agreeable to the counterpart the offer is rejected and a counter offer can be extended amending the point in the offer which was not agreed to. If the offer or counteroffer is agreeable to all parties and executed it becomes valid and binding.

What is consideration? In order for a contract to be considered legally binding, consideration must be given. Without consideration it is only a gift. In nearly all Colorado real estate transactions consideration is monetary in the form of earnest money which represents part of the purchase price. Earnest money in a real estate transaction is also considered good faith upon the part of a buyer to show they are serious about the purchase.

The main points covered in the contract to buy or sell real estate are to identify the parties to the transaction, identify the property, spell out the terms of the agreement and repercussions should a party to the agreement fail to perform.

When purchasing a home, time is of the essence.

Built into an agreement to buy or sell real estate is steps and deadlines for their completion. Complying with the timing built into the agreement is vital to a successful transaction. When agreeing to purchase or sell a property you are agreeing to adhere to the timelines and failure to do so can put any buyers earnest money at risk or put a party in breach of contract. Time is of the essence.

Just a few (not all) of the important dates spelled out in a contract to buy or sell real estate are:


Loan commitment deadlines

Title commitment deadlines

Deadline for hoa documentation

Inspection objection deadline

Insurance objection deadline

Acceptance deadline

And there are several more


Respect the contract as it is a legally binding document. Anything agreed to should always be in writing and not adhering to the contract has consequences, headaches and heartaches.

Next up in the Denver CO First Time Home Buyer Series  What to Expect with Home Inspections (Part 8)
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            <pubDate>Mon, 06 Sep 2010 07:44:43 -0600</pubDate>
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            <guid>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-what-to-expect-with-home-inspections-part-8.html</guid>
            <link>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-what-to-expect-with-home-inspections-part-8.html</link>
            <author>bruce@bruceswedal.com (Bruce Swedal)</author>
            <title>Denver CO First Time Home Buyer Series – What to Expect with Home Inspections (Part 8)</title>
            <description> <![CDATA[ 
You read this guide, followed the steps and are well on your way to owning your first home. Your Denver Realtor negotiated the terms and the contract was accepted. What happens now?

Among other things first time home buyers in Denver CO will normally get a home inspection completed prior to the inspection objection deadline. Why complete an inspection? Very simply, it is to protect yourself. You want to know the condition of the property you are purchasing and if there are any major issues. Discovery of these issues prior to the inspection objection deadline gives you options to terminate the agreement and protect your earnest money or request the seller to correct any major deficiencies.

What you should know about home inspections:

Professional home inspectors will perform a general inspection and issue a report of the propertys condition at the time of the inspection. The inspector will not be able to tell you what may or may not fail at a future date. The inspection will be completed visually and there may be items belonging to the seller which obscure the inspectors ability to inspect them. The home inspector will not be able to find every possible thing which may be wrong with a home during an inspection which does make it important for a home buyer to obtain a home warranty that covers the first year of home ownership.&nbsp;

Inspectors may not discover everything, but they should discover most items and give a home buyer a good understanding of the condition of the property. Some items may only be discoverable as specific conditions arise and if those conditions do not happen while the inspector is present a condition may be missed.

A home inspector is a generalist related to the condition of property. In some instances it may benefit you to have a specialist examine the property. A home inspection is not a warranty and is completed to lessen the odds of a home buyer getting a lemon.

Home inspectors should either come well recommended or be certified through an organization called The American Society of Home Inspectors (ASHI). Your Realtor should be able to supply you with a list of quality home inspectors.

What you should know:


No home is perfect whether new or existing  there will be flaws discovered.

Your Realtor can guide you on reasonable requests for repair.

Requesting the seller to repair an item is a new negotiation and should be completed prior to the inspection objection deadline.

The likelihood of the seller agreeing to make repairs will depend upon many factors.

Yes, you should plan to be there for the home inspection.


Next up in the Denver CO First Time Home Buyer Series  The Loan Process and What to Expect (Part 9)
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            <pubDate>Mon, 06 Sep 2010 07:44:42 -0600</pubDate>
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            <guid>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-the-loan-process-and-what-to-expect-part-9.html</guid>
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            <author>bruce@bruceswedal.com (Bruce Swedal)</author>
            <title> Denver CO First Time Home Buyer Series – The Loan Process and What to Expect (Part 9)</title>
            <description> <![CDATA[ 
Here we are back at home loans which we talked about previously and are coming full circle. We are getting near the end of this series. There will be one more installment. Is every little detail covered? There may have been a few which were missed. However should you have questions, it is an easy thing to pick up the phone, call me and ask.

At this point you should have an executed agreement for the purchase of the home you have been dreaming of owning. You already have been pre-qualified and now is the time to work with the lender to complete the underwriting process. If you have not decided upon a lender at this point you should hope that the seller will agree to extend the closing.

A few of the finishing touches you will need to make on financing are:

Submit any remaining documentation to the lender. If you are only pre-qualified and not pre-approved you will still need to make sure that the lender has 2 months worth of recent pay stubs, 2 years of tax forms and W2 forms, documentation (statements) for all financial accounts and assets. These are essential in the process to ensure you have a smooth closing.

Locking in the rate:

Interest rates not only fluctuate daily, they also fluctuate throughout the day. Much like a stocks value can change on a moment notice, so can the rate of interest for a mortgage. Clients will ask my opinion on where the rates are going, but the truth is that neither I nor anyone else can accurately predict what the future holds. Look at what you have today and ask yourself if you are happy with what you have. If youre happy then lock in the rate and be happy. In the future the rate could go up just as easily as it could go down.

Property Insurance:

As previously stated the lender will require that insurance is carried on the property that is being purchased with the loan. Call your preferred insurance provider and let them know you are purchasing your first home, also be prepared and give them your lenders contact information. Then give your lender the insurance agents contact information. They will take it from there.

In general you should now be in good shape. On occasion there is additional documentation that the underwriter requires, so be prepared to provide it quickly. Delays could delay your closing.

Upon receipt of the contract by the lender, they will contact the title company processing the closing in order to get a title commitment. The lender will also take care of ordering an appraisal on the property, but will wait to do so until the inspection is out of the way. Once a complete packet is together the lender will send the file to underwriting for processing and to obtain a clear to close.

Understand that underwriting is not complete until you hear the words  clear to close  from the lender. Prior to the clear to close be prepared to provide the lender with any additional documentation required for underwriting. In todays lending environment it is becoming commonplace for the underwriter to request additional documentation of some kind prior to approval.

Next up in the Denver CO First Time Home Buyer Series  The Closing Table (Part 10)
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            <pubDate>Mon, 06 Sep 2010 07:44:40 -0600</pubDate>
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            <guid>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-the-closing-table-part-10.html</guid>
            <link>http://www.denversrealestate.com/blog/denver-co-first-time-home-buyer-series-the-closing-table-part-10.html</link>
            <author>bruce@bruceswedal.com (Bruce Swedal)</author>
            <title>Denver CO First Time Home Buyer Series – The Closing Table (Part 10)</title>
            <description> <![CDATA[ 
I hear the cheering already as we come to the close of this series on Denver CO First Time Home Buyers. Why? Because we are at the closing table and the end (or beginning) is in sight. You are excited as am I, because another successful first time home buying experience is culminating. You are happy!

You received the HUD statement prior to closing which breaks down the financials of the transaction. You have the number (if any) which you need to bring to closing. Plus you should have already seen the truth in lending statement from the lender.

If an amount is due from you at closing bring a cashiers check from your bank to closing which is made payable to either yourself or the title company. The HUD has the amount and your Realtor will clarify that with you. Take the time at least a week prior to closing to contact your bank and ensure that getting the required funds in the form of a cashiers check will not be a problem. You dont want any hiccups this late in the game.

Remember to bring two forms of identification to closing with you - A valid drivers license and one additional form of identification. A social security card or passport will suffice for a second form of ID. Honestly you will probably not need the second form of identification, but bring it to be safe. Every once in a while the funding agent for the lender will require two forms of ID to release funds and it is far better to have them with you if needed.

The closing will consist of about an inch of documentation for you to sign. Some of them will be loan documents and some will transfer the ownership of the property into your name. The title company will explain each document that you are signing. This process is called closing. Expect it to take two hours. The shortest time I have seen it 31 minutes but an average time is about an hour and a half.

Both of buyer and seller will sign their respective documents after which the title company will be required to send a portion of those documents to the funding agent with the lender in order for funds to be released and the closing to be finalized.

Lenders have different processes at this time. Some will re-verify credit and or employment prior to releasing the funds to the title company. DO NOT incur major expenses or take on new debt prior to closing without discussing everything with your lender prior to doing it. Changes to credit ratings or debt ratios at this point can derail your purchase. Once the lender releases the funds to the title company your purchase is considered funded and they will finish up the closing.

Congratulations on purchasing your first Denver CO home.

After all this time, when do you get possession? Well that depends upon what was negotiated up front. In general when the home is occupied in Colorado the sellers will want up to three days after closing in order to vacate the home. Why? Well the sellers dont want to move out a home until after they are certain that closing will happen. They are not certain until closing actually occurs. On vacant homes it is typical to get possession right after closing is complete.

One final note  Remember prior to closing to call the utility companies and have them switched into your name effective the closing date. The switch over of water and sewer will be taken care of by the title company. 
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            <pubDate>Mon, 06 Sep 2010 07:44:37 -0600</pubDate>
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