Holiday Travels From Highlands Ranch

One of the first things I did when I moved to Highlands Ranch was to get a Neighborhood Watch started. Simply, it is neighbors looking out for each other. It works as one of our neighbors saw a bad guy, called the sheriff and it turned out he was trying to abduct his estranged wife. Good outcome as he is still in jail!

The last thing you want if you’re traveling these holidays is to worry about someone burglarizing your home. Use this check list to add some peace of mind while you’re out of town.Highlands Ranch

  • Ask a trusted friend – to pick up mail, newspaper and keep yard picked up to avoid an appearance of being empty. DO NOT CANCEL THE PAPER.
  • Consider discontinuing your mail (USPS Hold Mail Service)
  • PLEASE Don’t post about your trip on Facebook and other social media until you return – some burglars actually look for this type of announcement to schedule their activities.
  • Do notify police or neighborhood watch – especially if you’re going to be gone for more than just a few days. Let your monitoring service know when you’ll be gone and if someone will be checking on your home for you.
  • Light timers make it look like someone is home – use several sets for different times to better simulate someone being at home.
  • Do unplug certain appliances – TV, computers, toaster ovens that use electricity even when they’re off and to protect them from power surges.
  • Don’t hide a key – burglars know exactly where to look for your key and it only takes them a moment to check under the mat, above the door, in the flower pot or in a fake rock.

These easy-to-handle suggestions may protect your belongings while you’re gone while adding a level of serenity to your trip.

If you want to start a neighborhood watch, ask your immediate neighbors first. Then if they are willing and you are in Highlands Ranch, contact the Douglas County Sheriff by clicking here or your local law enforcement agency.

As an aside, when I retired from neighborhood watch I had over 5000 names & addresses in my database in Highlands Ranch, we had solved 2 major crimes, prevented the abduction and had well over 30 active block watches. The Sheriff’s office caught up with us and got a computer to keep the lists and I got a plaque. That was in the mid 1990s. It was a good run and proved that neighbors watching out for each other works.

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Denver – Cash-In Refinance

Would someone really refinance their Denver home and not take money out of it? Certainly, if they could get a lower rate, build equity faster and pay off the home sooner.Denver

For people with extra cash available, this can be very attractive compared to the low savings rates being paid by banks.

In the example below, the current mortgage is 5% for 30 years after 48 payments of $1,342.05. The owner can refinance for 15 years at 3.37%. If they put $36,000 into the refinance, their payments will be slightly more but the mortgage will be paid off in 15 years. At that same point, if they keep the current mortgage, their unpaid balance will be $136,049.03.

If you have a goal to get your home paid off and have the available funds, a Cash-In Refinance may be just the strategy for you.

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Make sure to contact me if you have questions or, want the names of some good lenders

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Denver-Up-front Points to Lower the Rate

While there is an overall savings by paying up front “points” (now known as discount fees in Denver – “points” is so 1990) there is even more in tax savings. Over the past number of years the IRS has treated the payment of discount fees or points by the Buyer as “pre-paid interest” which creates a deduction at tax time. Current tax reform may change that and as always I suggest you consult your tax professional when considering this. You might use this to get a tax deduction on this years taxes even though you have only owned the home for a short period in 2017. Denver home buyers might even be helped with their end of year tax planning.

When loans are quoted by lenders, most buyers pay attention to the interest rate but not so much to the points that may be charged along with the rate.19269905-250.jpg

A point is one-percent of the mortgage amount and considered pre-paid interest that affects the yield on the loan. Buyers or sellers can pay points but there can be limits based on underwriting guidelines for different types of loans.

A lower note-rate would obviously make the payments less. However, with a little analysis, you can determine how much points paid up-front can save a borrower or whether you’ll recapture the additional costs in the anticipated time in the home.

In the example below, two choices are compared; a 4.25% loan with no points vs. a 4.00% loan with one point. If the buyer stays in the home at least 69 months, he will recover the $2,700 cost for the point on the lower interest rate.

If the purchaser stays ten years, he’ll save two thousand dollars over the cost of the point. A less obvious advantage will be realized because the unpaid balance on the lower interest rate loan will results in an additional $1,780 savings.

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This is an example of a permanent buy-down but temporary buy-downs are also available. A trusted mortgage advisor can help you determine alternatives. Of course I can guide you to some of those trust ed advisors in Denver and all you need to do is CONTACT ME!

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Debt Relief May Trigger Tax

The Mortgage Debt Forgiveness Act, originally passed in 2007, was extended three times to protect homeowners from paying income tax on debt that was relieved due to foreclosure, short sales or deed in lieu of foreclosure. Mortgage Debt Relief example 2017.png

The law expired on December 31, 2016 and unless it is extended again, homeowners with debt relief in 2017 may be subject to tax.

A homeowner might feel a sense of relief without the obligation of a delinquent mortgage but just because the payments are no longer due doesn’t mean that there isn’t another obligation that replaces it. If a lender cancels or forgives debt, a taxpayer must include the cancelled amount in their income for tax purposes depending on the circumstances. The tax significance could be serious.

This previously allowed relief only applied to a taxpayers’ acquisition indebtedness of their principal residence which did not include second homes and investment property. The maximum amount was limited to $2 million of mortgage debt forgiveness or $1 million if filing separately.

Due to the serious consequences involved in short sales and foreclosures, it is advised that homeowners faced with this possibility should seek expert advice from their legal and tax professionals.

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Indecision is Not a Decision

Wanting to buy a house in Denver takes some definite and strategic planning. First, make sure that you can get a loan. What do I need to get a loan? Typically, it takes about $60,000 gross income per year to qualify for a $300,000 home loan. And a good credit score. You need to ask “How can I improve my credit score?” Sadly, some lenders have gotten into the mode of “producing” and have forgotten the joy of helping those who need it.

There could be some legitimate reasons for not buying a home but indecision is not one of them. Indecision is rooted in not having enough information to move forward to own a home or continue renting.denver

If you keep renting, at the end of the year, you have had a place to live and a pile of receipts that helped the landlord pay for his house. Deciding to buy a home will give you a place to live that is yours and all the things that come with that.

When you consider principal reduction, appreciation and tax savings, your monthly cost of housing could be much less than the rent you’re paying. The principal reduction included in each payment is like a forced savings account that increases as your mortgage balance decreases. Your equity in the property will also grow due to appreciation as the home goes up in value. The equity is part of your net worth and an investment in your family’s future.

The income tax savings can be an additional financial consideration if the combined interest and property taxes are greater than the allowable standard deduction.

Trends are showing that both tenants and homeowners are staying in their homes longer. It’s been said that whether you rent or own, you’re paying for the home. Do you really want to buy the home for your landlord? Check out your numbers on a Rent vs. Own and then, call us to help make it happen.

As you consider the possibilities of home ownership In Denver there are a lot of questions…some I can answer and others a loan officer is needed. However, home ownership is still the best investment for long term growth. And even though you own a home, you still need to keep your credit sparkling clean for the next opportunity that will show itself. Do not let those credit cards get behind, and make those minimum payments. Therefor when those questions arise make sure to reach out and call or contact me.

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Denver: Risk Rate Relationship?

Many years ago when I was just starting in real estate in Denver, I had clients who would shop interest rates and pick a lender based upon the rate quoted. More often than not, and in spite of my coaching, those rates would be for a 10 day close. That meant the loan had to close in 10 days or less to get the rate quoted. Normally, that did not work out, but after all the trials and tribulations of getting that initial approval, the borrower would stay with that lender. not always a pretty result.

Regardless of what a lender quotes on mortgage rates, the actual rate a borrower pays is based on a number of variables. Lenders determine whether to loan money and at what rate based on the risk involved with the transaction.Denver lenders

Factors that increase the risk that the loan will be repaid will proportionately increase the interest rate charged to the borrower. If the risk becomes too high, the loan will not be approved.

  • Loan amounts – conventional mortgages above conforming limits as set by Fannie Mae and Freddie Mac are considered jumbo loans and generally have a higher interest rate.
  • FICO score – the lowest interest rate is reserved for the highest score; the lower the score, the higher the rate the borrower will pay.
  • Occupancy – borrowers occupying a home as their principal residence are considered a better loan risk than second homes and investment properties.
  • Loan purpose – purchase transactions generally have the lowest interest rate with refinancing for better rates and terms being priced slightly higher. An even higher rate might be charged for refinancing and taking cash out of the property.
  • Debt-to-Income Ratio – a borrower’s monthly liabilities divided by their gross monthly income develops a ratio that helps lenders to assess the borrower’s ability to repay the mortgage.
  • Property Type – some types of property are considered higher risk than others which could adversely affect the rate.
  • Loan-to-value – the lower the percentage of the loan to the appraised value of the property will generally lower the interest rate.

Any combination of these factors could limit a borrower’s ability to secure a mortgage at the rate initially quoted. Pre-approval by a trusted mortgage professional can be the best way to know what rate you can expect to pay. Please call for a recommendation of a trusted mortgage professional.

Currently I have 5 or 6 clients, who will be home buyers in Denver that are in credit repair, services that good mortgage companies offer to their clients in need of increasing their credit scores. Often procedures include new credit cards that are pre-paid, paying off small debts and closing some accounts. But honestly, just by following what I just said, you might not get the right accounts. So, to get the best rate, today or a year from now, do not go it alone. CONTACT me and I will direct you to a good lender that can help get you ready.

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Denver: Pre-approval is Good for Everyone

“CASH IS KING” in Denver’s real estate market these days and our “word” that we can afford to buy the house just does not work anymore. The Seller wants to see that someone else, who has the ability to provide the funds has looked at your credit, job history and funds to make sure you can get the loan. That gets you as close as you can to having “CASH”. In Denver’s red hot real estate market Cash is still king yet your…

Buyer’s mortgage pre-approval is good for you and everyone in the transaction. It saves time, money and removes the uncertainty of knowing whether the buyer will be qualified after negotiating a contract. The direct benefits include:

  • Looking at “Right” homes – price, size, amenities, locationPre-approval is good for everyone.png
  • Find the best loan – rate, term, type
  • Uncover credit issues early – time to cure possible problems
  • Negotiating power – price, terms, & timing
  • Close quicker – verifications have been made

There is a significant difference in having a trusted mortgage professional take a loan application and run all the necessary verifications compared to going through calculators on a lender’s website. Beside the peace of mind, the cost of being pre-approved is a bargain and generally, limited to the cost of the credit report.

Even if a person has been pre-approved, a second opinion from a different lender may be a good option. It can verify there is a good deal or you’ll discover that you can improve it. Either way, it works to your advantage. Contact me if you’d like a recommendation of a trusted mortgage officer.

When there is a shortage of properties on the market, like in Denver, the buyer needs as many arrows in their quiver as possible and the first one is the pre-approval (not pre-qualified) letter from a reputable, local lender. Others will include your buyer’s agent and their market knowledge, their negotiating skills and tactics, and if they create trust in you. They should ask for a buyer’s agency agreement to be signed as well (but that could just be me) so you will know whose side of the fence they are on. If you would like to talk more about where to live or who good lenders are CONTACT ME here

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Denver Real Estate Play the Game

So many times I have seen folks get that glassy eyed look over a foreclosure or other “deal” in Denver real estate. Friends are especially happy to help you leave your money with them. It would be my pleasure to help you when that time comes. So no matter where in Denver it is, lets take a look and do not forget there really are some rules…

It’s much easier to play a game when you know the rules so you can avoid mistakes that may keep you from winning. Homeownership isn’t a game but there are some rules that will protect your investment and increase your enjoyment.

Most people want a home of their own to raise their family, share with their friends and to feel safe and secure. In most cases, it is also their largest asset. These suggestions can help protect your investment and make homeownership more enjoyable.Denver real estate

  • Don’t overpay for your home
  • Maintain your home to protect its value
  • Minimize your assessed value to lower property taxes
  • Make extra contributions to save interest and build equity
  • Validate the insured value of improvements and contents
  • Be aware of current surrounding property values
  • Make mortgage interest payments deductible
  • Invest in capital improvements that increase market value
  • Don’t over-improve the neighborhood comparables
  • Keep records of capital improvement & other maintenance

I would like to be your personal source of Denver real estate information and we’re committed to helping from purchase to sale and all the years in between. If you need assistance with any of the items mentioned in this article or need a recommendation for a service provider, it would be our pleasure to help. And please remember, I can even connect you with someone I trust across the country.

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Protecting Your Credit

One of the “big” three credit bureaus recently announced that a massive hack has exposed the personal information of up to 143 million people. To add perspective to that statement, that is about two-thirds of American credit card holders or close to half the population of the United States. Part of protecting your credit is being vigilant and making it difficult for thieves to steal your identity. Denver

If you suspect you are a victim of identity theft, an initial step is to place a fraud alert on your account. Contact one credit reporting company (Equifax, Experian or TransUnion), tell them you are an identity theft victim and ask the company to put a fraud alert on your credit file. Confirm that the company will contact the other two companies.

The initial fraud alert will make it harder for an identity thief to open accounts in your name. The alert lasts for 90-days and it can be renewed.

A more severe precaution called a credit freeze restricts access to your credit report. A credit freeze makes it more difficult for thieves to use your identity to apply for loans or credit cards in your name.

By contacting each of the three credit reporting agencies separately, you can request a temporary freeze. This would prevent them from providing credit information without both your explicit permission and a PIN that temporarily lifts the freeze.

Unlike the fraud alerts, the agencies may charge you a fee for instituting the freeze in addition to another fee to lift the freeze each time.

A credit freeze will not affect your credit score. If you are in the process of buying a home, contact your loan officer and discuss the decision you are considering. If you will be making a mortgage application in the near future, you can temporarily lift the freeze for the lender you are using.

A trusted mortgage professional is a key team member in purchasing a home. Making an appointment with them is one of the first steps along with determining your real estate professional. Contact us to get a recommendation of a trusted mortgage professional.

To request a credit freeze, you can do it online or by phone:

Equifax – 800-349-9960 | Experian – 888-397-3742 | Trans Union – 888-909-8872

For more information, see Credit Freeze FAQs at the Federal Trade Commission.

It is important to personally monitor your credit reports through annual credit report.com to discover any unusual activity.

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Denver – Downsize with Dignity

Living in Denver for the last (can it be?) 39 years, has shown me a lot about how I, and my clients & friends age.  The included chart  is a great summary of the events, health-wise, that might be indicators of our progression through life.

Knowing the physical aspects of aging can help you better understand and serve those

Denver Downsize

How we age in Denver

above 50 in your life. The good news is that, in absence of disease, normal aging can be a rather benign process. Genetic and environmental as well as lifestyle factors determine how we age. There’s good news about aging. A long life span provides the benefit of a greater perspective on life, self-knowledge, and a new depth to our gratitude. We also become less concerned with what others think about us, except for our physical appearance.

Many life decisions – marriage, child rearing, career, retirement – are settled and are no longer worries. Some might say a pleasure of “settling scores” comes from living well and “outliving those who were mean to us”. Respect for one’s own experiences, feelings, and opinions all contributes to successful aging as does respect for the body through daily exercise and a healthy diet. And we all know, Denver is one of the healthiest cities in America.

If you would like an invitation to our next Downsizing with Dignity presentation please contact me.

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