2 The Home Buying Process Archives - Page 3 of 4

2.6.1 Types of Loans

There are many types of loans available to consumers in the U.S. market. In part, this is because mortgage lenders make money only if they can find a way to make you a loan. Additionally, it is because home ownership has long been a priority of the U.S. government. They have put money and programs behind this priority. Much of the diversity in mortgage loan programs can be understood with reference to three factors: The “Term” — 10, 15, and 30-year loans The “Payment Structure” — fixed rate, adjustable rate, and balloon. The “Source” — FHA, VA, conventional, and jumbo

November 16, 2017 No Comments

2.6.0 Home Loan Basics

Home Loan Basics The loan officer you meet with to begin the process of obtaining a home loan is not the lender’s gatekeeper but your “loan coach.” Their job is to identify the loan that best meets your needs and to find a way to help you get it. Loan and financing issues are inseparably linked with other aspects of the home buying process. There are many reasons why you should begin your home search by sitting down with a good loan officer. With them, you can talk through the options that are available to you. In our section about

November 16, 2017 No Comments

2.5.4 Title Related Documents

Title Documents In Colorado you will encounter two title related documents in almost every real estate purchase. The title company issues a Title Commitment. This document outlines the terms under which they will insure the Buyer’s ownership or “title” to the property. If you are buying a single-family home, not a condo or townhome, the lender may require a survey of the property. A survey indicates the location of the property boundaries and any improvements such as the home, garage, decks, and so on. And, finally, prior to closing, the title company will prepare a balance sheet for you. This

November 9, 2017 No Comments

2.5.3 Home Inspection Related Documents

Home Inspection Related Documents Once you’re under contract, you should have a professional home inspection. Once you’re under contract and have received the seller disclosures required under your purchase contract, get a professional inspection. Most of the inspectors we work with will produce a detailed written report on the defects and concerns they have with the home. They also create a longer, descriptive report with additional information on the home. This might include the type and age of the furnace and the amount of insulation in the home. The state has provided a standardized form used to outline the Buyer’s

November 9, 2017 No Comments

2.5.2 Lender Documents

Lender Documents There are several forms that you’ll use in working with lenders, and these are highly standardized. Early in the process, you’ll run into the Loan Application form and the lender’s Good Faith Estimate. These are both lender documents. The application form requires little explanation. The good faith estimate is the lender’s attempt to give you a reasonable estimate of all the costs involved in purchasing a property. To determine whether the sales price is reasonable, the lender will hire an appraiser. The appraiser will do an evaluation of the value of the property, called an Appraisal. The appraisal

November 9, 2017 No Comments

2.5.1 Colorado Contract Forms

Colorado Contract Forms Like many human endeavors, real estate is done both in person and on paper. In this section, we provide access to many of the documents that you’ll encounter in the course of buying a home. The Colorado Real Estate Commission standardizes all the common contract forms in use in Colorado. For example, some of the more common forms you will encounter as you take the initial steps in the home buying process are below. WORKING RELATIONSHIPS WITH REAL ESTATE AGENTS The state’s brief definitions of the legal relationships you can establish in working with real estate agents

November 9, 2017 No Comments

2.4.4 Negotiating the Contract

Negotiating the Contract You need to evaluate your own situation honestly and realistically before you begin negotiating the contract. The Offer It is difficult to describe the negotiation process in detail because they can vary so greatly. The general structure of the exchange, however, is fairly simple and routine. Occasionally, buyer and seller will sit down and talk through the terms of the contract together. More often, it begins with the buyer submitting a written offer to the seller. Typically, the offer will give the seller a limited time frame (12-72 hours) to accept — if they wish to accept

November 9, 2017 No Comments

2.4.3 Structuring Your Offer

Structuring Your Offer Review the standard Colorado real estate contract form to get a feel for some of the decisions regarding structuring your offer. Generally, the issues you need to think through concern dollars, dates, and conditions. The goal is to protect yourself while making the offer as attractive as possible to the seller. If looking at an excellent property that has just hit the market, you may need to give up some security for the seller to accept your offer. In this instance, you should understand what you are giving up and how important this is to the seller.

November 9, 2017 No Comments

2.3.2 Evaluating the Property

Evaluating the Property You take the most important step in evaluating a property before you decide to make an offer. When you make the initial decision that you like it, that it will work for you, and it seems to be reasonably priced, you are on your way. Once you’ve made the offer and it has been accepted, you will pursue evaluating other important aspects of property. Written correctly, the purchase contract gives you the right to evaluate the property as you see fit. A good contract also allows you to terminate the contract if you are not satisfied. Before

November 9, 2017 No Comments

2.3.1 Make Your Best Purchase Offer

Make Your Best Purchase Offer Make an Offer and Write a Contract Once you’ve found right property, you need to put together your best purchase offer. Most buyers use the standard contract developed by the Colorado Real Estate Commission. In Colorado, the law requires real estate agents to use this form however the Real Estate Commission allows us to delete irrelevant clauses or add additional provisions designed to protect our client’s interests. Buyers, or any attorney they hire, can draft a purchase offer without using this form. In most cases though, if you hire an attorney, he or she will

November 9, 2017 No Comments

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