Posts Tagged homebuyer

Your New Home

Things to know before you buy:

Before venturing into the territory of homebuying, there are several things you might want to consider. Below is a list of ten things every potential homebuyer should consider:

Get pre-qualified for a loan

Early in the home buying process, find out what you can afford to spend. This will help you make informed decisions about which homes to look at, which one to ultimately select and possibly what the bottom line asking price should be on selling a home you may already own.

Know your credit rating

Marginal or bad credit can make a big difference in the type of financing available to you as a homebuyer. There may be special programs out there to help you repair your credit, but it helps to know what you’re dealing with up front.

The down payment

You will probably need some sort of down payment on any property you purchase. While some loans offer a no down payment option, it makes a huge difference in your monthly mortgage payment when you are able to provide a substantial down payment on the property. For more information on down payment programs available in your area, consult with a lender to find the right program.

Closing costs and other considerations

The cost of making the purchase can include charges such as:

    1. Escrow fees
    2. Title policy fees
    3. Mortgage Insurance
    4. Fire and Homeowners Insurance
    5. County Recorder fees
    6. Loan origination fees


Some loans will have “points” attached. Points are a loan origination fee that is equivalent to 1% of the loan amount. You may incur a higher interest rate if you choose a loan with no points, but there are many different combinations available. Shop around for the most competitive deal.

Types of mortgage loans

Would you prefer a fixed rate or adjustable? This will depend largely on where the interest rates are when you are shopping for your loan. If rates tend to be higher, you may opt for an adjustable rate so that you are able to take advantage of any rate drops that may occur during the life of your loan. If rates are low, you might want to lock in the best rate while you can.

Loan categories

There are two types of loan categories out there. These are Conventional Loans and Government Loans. Conventional mortgage loans are offered with either fixed or adjustable interest rates. Mortgage insurance may be required depending on the loan. Government loans include Federal Housing Administration (FHA), Veterans Administration (VA).

Low to moderate income

If you fall into one of these categories, you may qualify for special programs geared towards helping the low to moderate income homebuyer secure financing. Lenders who specialize in real estate mortgages can help you find these types of programs.

Mortgage Insurance

Conventional loans with a larger down payment may not require mortgage insurance, however, it is always required on the FHA loan. This insurance is meant to protect the lender in the event of default.

Home loan counseling

Many organizations offer classes to potential homebuyers to help prepare you for the process. Topics covered may include: realtor selection, home selection, homeowner responsibilities, saving for a down payment, and loan program information. These classes can be especially helpful

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Closing on your new home

Congratulations! You are about to close on your new home. The closing process is where you will complete the final round of paperwork needed to purchase the home. When it’s over, you’ll walk away with keys to your new home (unless there is a special provision in the sales agreement for allowing the seller more time to vacate the property). The following is information that might be helpful as you enter the final phase of the purchase process.

Homeowner’s Insurance

At the closing, you will present your Homeowner’s Insurance receipt. This will show that you have the necessary insurance on the property. You will then move on to review of the HUD-1 Settlement statement. Your closing agent will go over the settlement statement to verify that everything in the agreement is as it should be.

HUD-1 Settlement Statement

This form is required for compliance with the Real Estate Settlement Procedures Act (RESPA). Once you have signed off on the HUD-1, you will move on to closing costs. As agreed upon, the buyer and seller will provide the closing agent with certified checks to cover the cost of the closing.

Remaining Documents

At this point, you will go over any remaining documents. The agent will have both the buyer and seller review information for accuracy and obtain the appropriate signatures.

Escrow Account

An escrow account will be established for the buyer. This account will cover property taxes, homeowner’s insurance, private mortgage insurance (PMI) if required, and any interim interest.

Execution of Mortgage Documents

This is the point in the closing when the buyer will sign all documents required by the lender. These include the note and security instruments that will include either a deed of trust or mortgage. These documents show that the buyer pledges the property as security for the mortgage loan. The mortgage check is presented and a warranty deed is given to the buyer.

At the end of the process, the seller hands over the keys to the home. New homebuyers should note that it is a good practice to replace all locks in a new home to prevent those who have duplicate keys from having access to your home and belongings. In addition to keys, the seller may have items such as warranty information for appliances, garage door openers, etc. to pass on to the buyer. After this has been done, the escrow or closing agent handling the closing will complete the recording of your purchase. This includes recording the warranty deed and related security instrument.

If you have agreed to take immediate occupancy, then you are then free to enjoy your new home! In the event that you must wait, alternate arrangements will be made for you to obtain the keys to the property.

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The Energy Star Home

Looking for an energy efficient new home? The following information can help you determine whether or not the home you are buying is Energy Star qualified. These days, we look to make the most of our energy dollar. If you are a particularly energy-conscious homebuyer, you’ll be happy to find that an Energy Star qualified home is up to 15% more efficient than homes built prior to 2004’s International Residential Code (IRC).

When building new homes, builders work with qualified Home Energy Raters to determine what features are right for the homeowner. Homes up to three-stories can earn the Energy Star label. This includes single or low-rise multi-family dwellings, site-constructed homes, attached or detached homes, manufactured homes, log homes and retrofitted homes. They first need to be verified as meeting the EPA’s guidelines for energy efficiency.


Properly installed, effective insulation in floors, walls, and attics will ensure even temperatures throughout the house. It will also allow for less energy consumption and a more comfortable place to live.


Protective coatings and sturdy frame assemblies help to keep hot and cold temperatures from infiltrating the home. In addition, high-performance windows can help to block ultraviolet rays from damaging carpet and furnishings in the home.

Ducts and Solid Construction

Making sure that holes are sealed and cracks in the home’s structure or duct system are addressed goes a long way to reduce dust, drafts, moisture and noise. A well-sealed home improves indoor air quality and the overall comfort. It also helps reduce energy bills.

Efficient equipment

Energy-saving equipment is more durable and will require less in the way of maintenance than standard equipment. In addition to their contributions toward energy-efficiency, these items also help with environmental factors such as making the home quieter, reducing humidity, and improving the home’s comfort level.

Appliances and Lighting

An Energy Star home may be equipped with standard Energy Star products such as lighting fixtures, bulbs, ventilation fans, and appliances. More information about Energy Star appliances such as refrigerators, washing machines, and dishwashers can be found at

Home Energy Raters

Third-party energy raters help builders to choose the most appropriate features when building new homes. These raters can inspect and conduct onsite testing to help verify that a home qualifies for this Energy Star rating.

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How to Find the Right Neighborhood

How do you tell a good neighborhood from a bad neighborhood? At a glance, they all look the same: the same winding streets, the same kids on bicycles, and the same polite neighbors. Some things you will never know until you actually live there, but you can find out a lot with a little research and some time. It will save you money, time, and hassle down the road if you know what to look for in a neighborhood and know how to find that information.

A neighborhoods location is very important for a variety of reasons. For some, being close to shopping centers and malls is a necessity, others desire a short commute to work, and many seek out easy accessibility to public transportation. Close proximity to hospitals and fire stations is usually at the top of most lists as well. To get an accurate idea of distance, don’t just look at how many miles it is but actually make the drive yourself.

It is important that a neighborhood has adequate fire and police protection, good area schools, and low crime. Often, the quality of the area schools affects the property value and desirability of homes. You should also look at how far away the schools are, and how safe the walking route is that leads to them.

More homeowners than renters in the area are a good signs as well, because when people own a home they often care more about its upkeep than renters. Also, any remodeling or renovations taking place in the neighborhood probably means that people like the area and are planning to stick around for a while. And of course, parks and bike trails in the area are beneficial for connecting the community and providing fun, healthy entertainment.

There are three main sources for information that you should check with: a real estate agent, the neighbors, and the community.

The Real Estate Agent. You can find out a wealth of information by simply asking your real estate agent. They will have information on the neighborhood, area schools, future developments, and more.

The Neighbors. Everyone is looking for different things in a neighborhood and neighbors, which is why you should take a stroll around the prospective neighborhood and strike up a conversation with the neighbors. Ask them about traffic and noise in the area and find out what they like best about the neighborhood.

The Community. Before purchasing a home in the community, try exploring the area on your own. Drive through the surrounding neighborhoods, and visit the neighborhood you are thinking of buying in at all different times of day. Have dinner in a local restaurant and talk to the servers and owners to find out what they think about the area and its residents. Finally, make a quick stop at the local police department for area crime records.

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Why Louisville, Colorado Is One of the ‘Best Places to Live’

Every year, Money Magazine selects 100 cities nationwide for their “Best Places to Live” annual listing. After being named the fifth city in 2005, Louisville, CO once again made the list, but this year it nearly topped it by taking the number three spot on the list of 100 best cities.

Originally founded in 1882 as a mining town, Louisville has grown into a modern, thriving city and is called “home” by over 19,000 residents. It maintains its historical charm by many of the downtown businesses that have been restored to reflect the original mining community. Located 25 miles from downtown Denver, Louisville is perfectly situated both far enough from the city to enjoy the beauty and relaxation of the countryside, as well as near enough to have a short commute or easy city outings.

Louisville, CO boasts a vast array of activities to accommodate both residents and visitors alike. With over 2,000 restaurants, 23 movie theaters, 54 libraries, 112 golf courses, 13 ski resorts, and 7 museums all in under a half-hour drive, it is bound to take more than a day to explore this charming city. A unique thing about this mid-sized town is that it is very easy to feel part of the community. Not only is everyone connected by the 26-mile wooded bike path that weaves through the town, but every Friday afternoon in the summertime the town gathers for the Louisville Downtown Street Fair, featuring live music and entertainment, craft booths, and delicious treats.

Although demand for homes nationwide has been steadily decreasing during 2007, Louisville has weathered the stormy waters of the current market. Even with more people selling than buying in Louisville, homes average time on the market is a mere 60 to 90 days. The average home price in 2006 was $322,812*, and although current housing costs are up slightly due to growing interest in the area, a wide variety of tastes and prices are available throughout the community. And, a plus for all homeowners is the low cost of property taxes, which in 2006 averaged only $1,986* a year.

This modern mining town even has its own unique blend of positive and negative factors in its economy. In the last two years, the median household income jumped from an average of $79,169 to $94,385, which was met with an increase in home costs, from $295,718 in 2005 to the present average of $322,812*. Much of the economy is based in the technology sector and the area is littered with Technology firms and businesses. Louisville, CO had a city-wide job growth of nearly 7% from 2000 to 2006, while most of the cities on the list of “Best Places to Live” experienced an average job growth of 13%*. Not to worry, however, because this mid-sized town in the Colorado mountains avoids the extreme ups and downs of the job market by maintaining slow and steady growth, making it truly one of the ‘Best Places to Live’.

* CNN Money Best Places To Live – Louisville

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How to Adjust to Your New Surroundings

Congratulations, you just moved into your new home. The paper work is complete, you’ve unpacked your things, the furniture is set up, and you even have your newly established street address and phone number. Yet, somehow in the midst of all this excitement you feel a bit nervous, and maybe even lonely. In this article we’re going to discuss several tips for how you can adjust quickly to your new surroundings so you feel confident and calm.

Know the Area

It’s important that you know the area in which you live, and there’s no better way to do that than take a few hours each week and drive around your community and neighborhood. Maps are great tools, but they are no substitute for the peace of mind that comes from truly understanding how to get where you need to go. By spending time driving to your local grocery store, hospital, and school during the day, you can have confidence when you need to drive there during the night. Also, learn multiple routes to get to the places you need. Many you need to go the grocery, but you’ll be coming from work instead of your house or there might be construction on your normal route. Don’t be thrown off guard by unexpected changes. Roads and traffic are much less intimidating when you understand what to expect in most situations.

Know Your Neighbors

It’s important to make a conscious effort to meet your neighbors in the first few months of living in a new area. Where this might be uncomfortable and nerve racking at first, you must realize that you’re not expected to know people the first few months in your new home. You don’t have to be nervous because you have any expectations to meet. It’s a new day. You have the possibility of establishing close friendships nearby, or at least making connection with your neighbors who could help you in a future time of need. A few suggestions for how to get to know your neighbors include hosting a local cookout, taking part in a local event or festival, or offering to help your neighbors with simple yard work.

Stay Connected

Where a new surrounding can be very exciting, it’s still important to stay in touch with people who live in your old neighborhood. Staying in touch through phone calls, emails, and even occasional visits can help you stay focused, grounded, and level headed. Close family and friends can give us the love, support, and encouragement when we’re down, but yet they are not afraid to inform us of when we’ve changed. By learning and understanding your new surroundings while not losing touch with your old friends and family, you have a great chance of establishing yourself in your new location, feeling calm, confident, and ready for any challenges that might come your way.

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Make and Save Money While Financing Your New Home

Setting up your mortgage can sometimes feel confusing and draining, because most people don’t want to end up paying for a mistake they made years ago. What many people don’t realize is that if done correctly, financing your new home can actually help you save and make money. In a previous article, we looked at three tips to help set up a proper mortgage. First, it is very helpful to pay off as much debt as you can before you commit to purchasing a home. The more you can pay off now, the less interest payments you’ll be making later. Next, find a bank that you trust. By doing both your personal banking and home financing in one place, you have a better chance of getting a small percentage break on your interest rate. Every discount helps when it comes to one of if not the biggest purchases of your life. Finally, fixed rates offer stable, long term savings on your new home. In this article we’re going to briefly discuss how you can build on these insights to help make you money.

Set Up a 30 Year Mortgage.

There are two common choices when it comes to the length of mortgage contracts for your new home: 15 years and 30 years. Where you might think it would be better to set up a 15 year mortgage, you can actually save more money by setting up a 30 year account. Setting up a 30 year mortgage will stretch your payments out so that your required monthly payment is roughly half that of a 15 year mortgage. Saving money comes into the picture when you take that extra money that you save on your initial payment, and you pay on top of your premium. By having a low payment, but paying extra on the premium, you put more money towards directly paying off the house. If you do this consistently and correctly, you’ll actually be able to pay off your house in roughly 15 years, while paying less money to the bank for interest.

Save and Invest Access Money.

Besides taking some of the money you save on a 30 year fixed rate and paying down on your premium, you can save and invest that money. Many banks and brokerage firms offer return rates of long-term investments of 6-12% percent. Where this might not seem so significant now, if you can save and invest for 15 years, not only will you pay off your mortgage, but you’ll have money in the bank on top of that to do with as you choose.

Mortgaging a new home can be stressful and confusing, but if you follow these tips, you’re on your way to making your money work for you!

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Buying a Second Home

You are on the market for a second home. Before you rush off to buy that tempting beachfront cottage or the mountain condo right on the ski trail, consider pausing to take a few precautionary steps. When buying a second house, it is far too easy to make rash, emotional decisions that can have stern consequences down the road.

If you don’t have time to read one of the countless books about buying a second home or to hours of research, you can get a summary of the information here. The wealth of information on this topic can be narrowed down to a few logical points to keep in mind.

Location is key. Even if you plan on using a second house only for yourself, make sure you purchase in an area that the property will still appreciate in value. Someday you may want to rent it out if you need the money or get bored with the place, so making an investment in a good area is important. Also, you may want to be sure the location is relatively near your present home to make quick weekends possible and to stay regular on upkeep for yourself or renters. Real estate agents have a variety of market research that can clue you in on renter’s preferences.

Do the math. Just as there are a lot of expenses you aren’t always able to anticipate with your current house, there will be an equal number of ones that come up with a second house. Only it will be harder to manage because you will be further away and not there as often. Costs such as garbage, insurance, landscaping, dues, and taxes need to be calculated to see if you can and want to afford a second house.

Do your research. Do not only visit the house itself, visit the surrounding community as well. Stay there a few days, talk to the neighbors, and get a feel for the area. No matter what time of year it is, ask for pictures of the house from all seasons, it is amazing how different a house can look when not graced by blossoming flowers and trees. Research the area also; finding out about weather, construction, and crime rates can impact the desirability for yourself and future renters.

Cool down before you buy. Don’t get caught up in the moment of a beautiful house. Too often people make rash decisions on second houses, because they are either afraid someone else will buy it before them or they think the house is one-of-a-kind. Houses, especially second houses and vacation getaway houses, will probably still be available months after you look at it, and there is never a shortage of them. You need to think about how much time you will realistically spend there, or if it will be like a gym memberships that gets constant use until March. Also, take into account how far away it is, in other words, if you will actually want to make the drive and if it will even be cost effective to go very often.

After all these things have been considered, you have given yourself a few weeks or months to think about it, and you still want to buy, then go for it and don’t look back.

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