Be sure to take your time and find a REALTOR® with strong credentials and a proven track record of helping people. For a conventional loan, you'll need a down payment of around 20%. © Copyright 2020, Great Colorado Homes INC. |. Let's see how the numbers break down for loans of different terms for a home worth Colorado's median home value of $415,647 (assuming a 20% down payment). You are now the proud owner of your new home. When in doubt, talk to your agent. Step 1: Start Your Research Early As soon as you can, start reading Web sites, newspapers, and magazines that have real estate listings. That’s why when you plan to buy a house in Colorado, you need to find an expert to help you navigate through the fluctuating real estate market. Currently, in Colorado, homes typically stay on the market for 51 days. 1, you should have a good idea of your home buying budget. There are many nuances and complicated steps that you must understand before making a bid at apublic foreclosure auction sale. Now watch video #5 of the Denver Home Buying Process 2:59. If this is the case, you want to make sure you: Are out of debt; Have 3–6 months of expenses saved up in your emergency fund You will be communicating with them often throughout the process of your home purchase. Sellers want more than just a signed contract before they take their house off of the market. 1. That’s the secret to all goals. most cases, it's best to keep your DTI under 36%. Your agent will handle all of the showing coordination and details. Get Qualified For Financing Let’s be honest here, before even looking for a house you need to know where you are. Be sure to contact a few different ones to compare rates and personality types. If you're taking out a mortgage, your lender will require an appraisal to ensure the house is worth the amount of money they're giving Steps to Selling a House in Colorado Springs Surprises are for birthdays, not real estate transactions. your realtor who will make sure you get a great deal. Remember that homes usually look different in person than they do online. Here are some easy ways to ensure your credit doesn't change after you receive your pre-approval letter: Viewing homes is the fun part of buying a house! On our site, all you have to do is click "Save Search" on our search page and you will be setup. Our network of vetted agents have proven track records with home buyers in your area and will get you a great deal on your dream home. Selling a house is a complicated process, so we provide this compreshensive guide “Steps to Selling a House” so that you can be educated and in … Make sure you have all of your key documents ready, and preferably get them to your loan officer before you put a contract on a home. As you're looking at homes with your REALTOR®, be sure to verbalize the things that you do and don't like so your agent can learn what your styles and preferences are. A house's neighborhood is just as important as … Here are some of the most important steps. Government-backed loans, like VA and FHA loans, have lower down payment amounts because they use other means to offset potential risk. Once you are past inspections, you're almost done! » LEARN: 12 Steps to Buy a Rental Property. There are MANY loan officers to choose from. For example, in Colorado, July is when there are historically the most homes on the market. Following the steps below will help you determine a clear path to finding the best house that fits your needs. While these rules aren't set in stone, if your Just know what you’re getting into up front. A full mortgage pre-approval will help guarantee that your financing doesn't fall apart later while you are halfway into the home buying process. Because when it comes to buying a house, timing is everything, and you need to have an expert negotiator on your side. Delayed appraisals are one of the main causes of late closings. Here's a list of the most common fees when buying a home. Choose one that you feel comfortable working with. The first step is for the buyer and seller to agree on material deal points. If you're viewing homes in a time of low inventory, you might have to be less picky before choosing a home to bid on. Some properties may be in multiple offer situations, which requires even more thought when structuring the offer details. Aside from interest rates and mortgage terms, you'll also want to find a lender who actively works with you to ensure the deal closes. Step 2: Choose the right neighborhood. Given that the median monthly income in Colorado is $5,996, a typical DTI in the state is 40%. 10 Steps to Buying a Home. And once you find a house, it's Clever can match you with the perfect realtor to get the best deal. :). Buying a house is one of the biggest decisions you can make, so you'll want to be prepared and informed every step of the way. Every area, price range, and home style have different aspects that determine value. When it's time to close, you'll be able to do a final walkthrough of the property to ensure it's still in the expected condition. Once you have found the perfect home, it's time to make an offer on it! This can mean problems later when you are actually under contract to purchase. Getting pre-approved for a mortgage gives you and the seller confidence that if they accept your offer, you'll be able to get financing and close the deal. You can make other compromises, based on the state of your market, to sweeten the deal for you and the seller. When figuring out how much you pay each month in debt, don't forget to include: Let's look at a few examples, using the average amount of debt in Colorado, to see how to calculate debt-to-income ratio. When you apply for a mortgage, the loan officer will ask you for previous years tax returns, employment verification forms, and previous month's bank statements. to your average monthly income. that cost money. This guide walks you through 25 steps to buying a home, including timescales. These figures are accurate as of April 2020. Most contracts are written with an inspection period to allow the buyer time to hire a home inspector and have the property thoroughly inspected. When you buy a home with Clever, you can receive a home buyer rebate to help offset buying expenses. You want a neighborhood that's in your budget, but can also lead to a big return when you decide to sell. In order to be treated as a legitimate buyer when you are out looking at homes, you will need to have a pre-approval letter ready from your lender. Buying a home at auction can also be a great way to get a deal on your first home if you’re patient and willing to follow the steps above. Join Clever’s network, Step 1: Evaluate your financial situation, Step 3: Find a great real estate agent in Colorado, 3 Options for Buyers After a Low Appraisal, Total housing costs (including your future mortgage) shouldn’t exceed, Total monthly debt payments shouldn’t be more than, Number of transactions in the last year (the more the better), Experience in your price range and chosen neighborhood, Don't close any accounts that have been open for a long time, Make all of your credit card payments on time, Inspect the ceilings, walls, and floors for cracks, chipped or peeling paint, or other imperfections, Test every light switch and electrical outlet, Run the water to look for leaks and check the pressure and temperature, Make sure you have working keys for all the doors (don't forget any garage door openers or smart lock technology), Test any appliances that are included in the sale, Check the heating and air conditioning system, Open and close all windows while checking that they lock and there are no unexpected drafts, Make sure all trash or belongings from the previous owners have been removed. Make sure that you allow plenty of time to get all of your inspections done within the days allotted in your sales contract. Is it better to buy or rent a home in Colorado? Here are 12 Colorado Springs neighborhoods that we absolutely love. You will need to negotiate the terms of the contract, such as the closing date, seller concessions, appraisal deadlines, inspection deadlines, repairs, etc. Once you have gone through all of the steps above and found a good mortgage lender, it's time to finalize your pre-approval. Depending on when you're house hunting, you might have to make an offer sooner than you'd expect — especially if homes spend fewer days on market than the annual average. Within certain areas, there will also be specific neighborhoods that you may like or dislike. Once you are past the inspections and appraisal process, you can set up a closing time with your title company and the other party. Selling Your Luxury Home – 12 Things the Best Luxury Realtors Do to … Search Listings 5. Once you have prepared your finances to buy a home, the next step is to find one. Trust your agent. When you start house hunting can impact your number of options. Your REALTOR® will guide you through all of your options and make everything clear. Price isn't the only thing that can influence a seller to accept your offer. We've drafted an outline of the process, including what steps you need to be anticipating, complete with more involved advice. At Springs Homes, we want to provide you a roadmap and a little insider insight which can go a long way to help ensure your experience is a good one. Your agent (or your lawyer) should explain every document before closing, but still ask any remaining questions you have before signing. You can use this section as a reference as you are moving through the final steps of buying your new home. Here are some of the most important factors to remember when looking at different homes: Start by writing out a list of everything you want in a home. Your Realtor and mortgage lender will keep you on track and walk you through each one of these steps. DTI is higher than these benchmarks, you will face more scrutiny during the underwriting process. If your credit drops, it can derail the process and keep you from closing on your house. In Colorado, the median home value is $415,647. Be sure to have the appraisal ordered as soon as your inspections are done. They don't want to waste their time with buyers who aren't serious or financially ready to put in an offer. Buying a home is one of the most stressful things you'll do, and it hasn't been made any easier by the coronavirus pandemic. Make sure that your lender has thoroughly investigated your finances. This number is found by comparing your average monthly debt (bills, taxes, etc.) Paperwork when buying a used mobile home in a park If you want to be rest assured that everything is above board, you should know what documents are involved in the typical sale of a mobile home. If your Colorado mountain land is within that 2 to 3 hours, a weekend away is easy and if it’s more like 1 to 1.5 hours a day trip or overnight getaway is possible. It takes time to gather all of this information, so be patient and do your due diligence. Do your research—and then do some more 4 Tips for Buying a House in the Colorado Housing Market. Everything from the local economy to your financials to the housing market in Colorado will impact what home you buy and how much it costs. Congratulations! Start preparing your finances right from the start and you'll be ready for the next step. No matter what your situation is, you need to check your credit history and know your credit before buying a home. When you know the areas that you like best, you can go online and look at all of the homes available in those areas. If the buyer intends to use a loan, the parties should discuss what steps the buyer has undertaken with their lender to be pre-qualified or pre-approved. Define Your Needs 2. 5 Easy steps to buying a house in Colorado! Once you have gathered some homes that you would like to see, contact your REALTOR® and setup a time to view them. Here are 5 important tips to help you through the home financing process: Some people may just assume that their credit is good enough to buy a house because they have never had a late payment. Knowing the rough outline of how the process works though will make the ride much smoother. . Buying a Second Home in Colorado Insider info on the advantages (and cautions) of buying a vacation home here. If the house does not appraise at value, then the contract will either be terminated or renegotiated. Be sure to research local crime stats, school ratings, and area amenities to help determine the areas that you would enjoy living in. The higher your debt-to-income ratio, the less likely you are to be approved for a mortgage; however, most lenders are more forgiving if you have a high credit score. Overview of the key steps in buying a home, from hiring an agent to closing escrow. In general, you'll need to consider the following factors to decide which area is best for you: After Step No. Mortgage companies require appraisals to verify that the loan amount they are providing is equal to, or better than the appraised value of the home. Colorado concealed carry reciprocity – 3 things to know. , Our Realtors are selling ninjas!Click here to see how they do it. Buying a home can be one of your most significant investments in life. Now that you have checked your credit, calculated your debt-to-income, and have gathered all your financial docs, you're ready to talk to mortgage loan officer. Is buying land in Colorado a good investment? Born and raised in Fort Walton Beach, Florida, he is one of the top real estate agents in the Pikes Peak region and has almost 20 years of experience buying, selling, and managing properties. FHA loans require down payments as low as 3.5%, but the borrower must also pay for private mortgage insurance (PMI) throughout the term of the loan. Clever’s Concierge Team can help you compare local agents and negotiate better rates. Read on to get all of the information you need to make it through the home buying process. If you find something on your credit history that is incorrect, be sure to resolve it before buying a house. Please feel free to share this article with someone who might benefit from it. Neighborhood Information 4. If you're planning to take out a mortgage to pay for your home, you need to understand how your financial situation impacts your buying options. If your income is $7,000 per month, your debt-to-income would be 43% ($3,000 [debt] % $7,000 [income] = 43%). unexpected pops up. Do some research on current sale prices in different neighborhoods to start narrowing down your options so you don't end up looking at houses that are out of your price range. Federal law requires additional disclosures for lead paint in homes built before 1978. After inspections and appraisals, you'll have a chance to go back to the negotiating table if something The appraisal is one of the last steps in the home buying process. Pay attention to realtors’: Once you have a list of 3-5 potential agents, schedule times to interview them to see if they'd be a good fit. By making a down payment, you put “skin in the game.”. Buying a house is exciting, but it's by no means easy. The appraisal is one of the last steps in the home buying process. During the walkthrough, be sure to run through the following checklist: On closing day, be prepared to sign a ton of paperwork. If you know what steps to prepare for and have the right agent by your side, you'll find the perfect home in your price range. ❤️ Thank you El Paso County for opening this wonderful new 8.5-mile trail in Black Forest. Clever can match you with a local agent who has the experience you need. Now that you have prepared your finances and found a home, it's time to close the transaction and get the keys! Aside from finding and showing you houses, they can also make recommendations for other services like lawyers, lenders, and escrow companies. Earnest money is kind of like a down payment for the transaction. Loan Approved! About Ray Brown Ray Brown is a Colorado Licensed real estate agent based in Colorado Springs. How To Buy a House in Colorado in 3 simple steps. Lucky for you, we know where to find one. While in February, Make buying a house in Colorado as simple as possible. Once you have an executed sales contract signed by both parties, you will need to submit your earnest money. They can let you know how quickly you need to put in an offer for your dream house. For example if your mortgage payment is $2,000 per month and your auto and credit card payments are $1,000 per month, your total debt is $3,000. You should always hire a licensed inspector and make sure they check out the following parts of the property: If the home has a septic system, it's also a good idea to pay for a septic inspection that scopes out the system with cameras to look for any potential issues. Some lenders may not ask for these documents until you are under contract. Once you're under contract it's very difficult, if not impossible, to change things later. Using that as an example, here's how much you'll need to save for a down payment: Legally closing a real estate transaction involves many services (title searches, document recording, etc.) You are well within your rights to ask why one of these aren’t being included as part of a sale. Having an inspection performed is one of the most important parts of the home buying process. The earnest money is credited back to you at closing, or will default to the seller if you cannot perform the details of the sales contract. Based on home value data from Zillow and interest rates from (Aug. 5, 2020). They know what homes in your price range and target neighborhood are like and can point out where you might have to make concessions. Unlike an inspection, an appraisal isn't strictly about the condition of the home; it's about its value. Welcome Home to this impeccably renovated home in the beautiful tree-lined Mayfair! Don't worry; it's often more straightforward than it sounds. Once both parties have signed all of the documents and the mortgage company has funded the loan, you will get the keys. Looking at the table below, historically, you'll need to move fastest in June when homes only stay on the market for 44 days. Are you a top realtor? In most cases, a conventional loan requires an after-mortgage DTI under 36%, a VA loan under 41%, and an FHA loan under 43%. When deciding whether to approve your mortgage, most lenders follow the 28/36 rule: So, let's use the median monthly income in Colorado, which is $5,996 (based on Census data), as an example to calculate a potential mortgage payment. Although a few of the details may look different right now, the overall process of buying remains the same — and understanding the key steps can … With more search options than any other local website. If the house does not appraise at value, then the contract will either be terminated or renegotiated. Once you're pre-approved for a mortgage, it's imperative that your financial situation doesn't change. Directly below is also an infographic that summarizes the 14 steps to buying a house! According to Zillow, the median price of homes currently listed in the Centennial state is $428,000. Closing Date and time is set. And, overlooking a detail like this could cause a major problem. After all, there are so many steps, tasks, and requirements, and you may be anxious about making an expensive mistake. A buyer's closing costs usually run between 2-5% of the loan amount and include costs like: » LEARN Colorado Closing Costs for Buyers. Here's an example of how to calculate your debt to income. Out-of-state buyers can be at a disadvantage because they probably don't know the best neighborhoods, school districts, local and state laws—or anything else, for that matter. ❤️, Here's a quick list of neighborhoodswith videos and statistics. Rank each item based on how important it is to you. To give you an idea of how appreciation could impact what your house is worth in the future, let's look at some examples of how homes in three neighborhoods in Colorado Springs have appreciated over the years. Your debt-to-income ratio is one of the main criteria a mortgage lender will consider when determining your loan pre-approval. Be sure to take your time and find the one that works best for you. Whether you crave the seclusion of country acres or a quaint residential lot in a subdivision, buying a piece of land is a bit different than buying a house.. To finalize your list of target areas, look into neighborhood features like: Your real estate agent will be your main ally during the home buying process. If the lender's underwriting process is slow, or if they take forever to give you all the necessary paperwork, it can derail your entire transaction. Don't just hire the first REALTOR® that you know. Some lenders will do a basic mortgage pre-qualification that is based off of minimal questioning. It's easy to forget aspects of a home when you are looking at multiple properties within the same day. Colorado is a “TABLE FUNDING” state…in other words the Seller brings the deed and the buyer brings the cash to the table and they “trade them at the table”. These items need to be handled in a timely manner. Most REALTORS® will have lenders who they can recommend as well. 1. see if they have the knowledge and experience to help you make an educated decision. Ask them questions about the neighborhood you're looking at (school system, trends in property values, any planned developments) to Take the time to research different agents who are experienced in your desired part of town and price range. Before you can find a home, you really need to know which part of town you want to live in. Buying a house requires a lot of time and effort, but these 10 steps can help make the home buying process manageable and help you make the best decisions possible. For example, if you put $20,000 down to purchase a home, you have a strong incentive to not default on your mortgage since you’d be giving up that $20,000 if the bank foreclosed on your home! Get Pre-Approved The will provide you will online tools that will keep you updated when new homes come on the market. Here's a list of 22 things you need to know before moving to Colorado Springs, CO. New MARKET INSIDER - Quick, easy-to-follow info with data from our local MLS. Once you find a house you love, it's time to make an offer and convince the seller to sell to you. Whether you’re buying land as an investment or for residential use, ask yourself the following questions before making any decisions. Earnest money proves to the sellers that you are a serious buyer and ready to purchase a home. you have more time to make your decision since houses typically spend 24.2 days longer on market than the annual average. Case in point, several states - including Colorado - allow a homeowner/borrower to reclaim his or her property throughright of redemption. Be very careful not to get pressured into working with the first lender you meet with. Preparing your finances is the very first step in buying a home. Your REALTOR® will be able to help you determine a good offer price by providing you with recent past sales data and current market data. Here are some common negotiating opportunities to work out a win-win deal with the seller: Once a seller accepts your offer, there are a series of due diligence steps that ensure the home you’re buying is exactly what you signed up for. 2020 Best Places to Buy a House in the Colorado Springs Area About this List Explore the best places to buy a house based on home values, property taxes, home … That is right at the limit. Mortgage lenders want to know you'll be able to afford monthly payments. Depending on where you live, there can be thousands of buyer's agents in your area, making it overwhelming to find the perfect realtor. Tips to Sell your house Fast In Colorado Springs! Thanks for taking the time to read this article. Be sure to remember to enjoy it when you finally close! 8 Steps to Buying a House in Colorado Step 1: Evaluate your financial situation. Qualified buyers get $1,000 — or up to 1% back on homes over $500,000 — which can help cover your closing costs, moving services, or go towards buying mortgage points.Plus, you'll work with a top agent in your area who will help you find the perfect home and get you the best deal. You have successfully sent this blog entry to your friend. If you're not sure which lenders have the best reputations in your area, ask your realtor. Clever’s Concierge Team can help you compare local agents and find the best expert for your search. Hiring a Real Estate Agent. Buying your first house is one of the most exciting things that you will ever do. It's protection for the lender. I'm Andrew Fortune, the founder of Great Colorado Homes and the creator of much of the content on this website. This is one of the best ways to keep up with the market. The goal of this site is to provide you with detailed information to assist you in … Buying a house can be an exciting dream or an overwhelming nightmare. 14 Steps To Buying A House – A Complete Guide For Home Buyers – Read on to find out specific details on the 14 step process to buying a house. With a shorter term mortgage, you'll have a lower interest rate, but a higher monthly payment. This will allow you to find the price range that fits your budget before you start looking at homes. You should be clear with the listing agent that you are buying a home without an agent. While some lenders will approve mortgages for borrowers with a DTI as high as 43%, in They have years of experience seeing buyers go through the home loan process and can tell you which lenders are the easiest and best to work with. It's good to have this information accessible before looking at homes. These things also affect future resale, so take that into consideration when doing your research. Luckily, Clever's concierge team can match you with hand-picked, local agents who will meet your needs. How much does it cost to buy a house in Colorado? Hi! Be sure to bring your driver's license (or passport) to closing, along with any monetary items required by the sales contract and/or lender. You can attend an open house, or call the seller or listing agent to ask for a tour.