Category Archives: Buyer Tips

How to Purchase a Home with Less Downpayment

Can I buy a home?

Can I buy a home?

Many would be home buyers are anxious to find a home of their own, especially when considering the very low interest rates we are experiencing.  The problem these potential home buyers are facing is a lack of funds for downpayment.

When purchasing a home by financing it with a mortgage it is common practice for the lender to require a downpayment.  Loans with 20% or more downpayment are less expensive for the borrower because they do not have to pay the mortgage insurance premium (MIP).

The good news is,  it is possible to purchase a home with less than 20% downpayment.

In fact, 73% of U.S. home buyers made a down payment of 20% or less, according to the National Association of REALTORS® Profile of Home Buyers and Sellers.

Programs for Home Buyers with Less than 20% Down Include:

FHA loan guidelines will allow for a qualified buyer to purchase with a minimum of 3.5% down.  FHA loans also have higher ratios so people who cannot qualify for a conventional loan may be able to do so using FHA.

Be advised, borrowers using FHA will pay an upfront fee for the Mortgage Insurance Premium.  This fee insures the lender against the borrowers default.  Why? Because when a borrow has little “skin in the game” the lender tends to feel they will walk away from the property if something goes wrong.  By charging the borrower this fee, they safeguard their investment.

Programs for Buyers with ZERO down payment

Some qualified buyers are eligible for 100% financing programs. Typically these programs come with additional requirements.  The borrower’s income must not exceed certain limits. The borrower will need to participate in a Home Buying Class.  Sometimes the programs will  come with additional requirements, i.e. the home must always remain a personal residence, meaning the borrower must sell it if unable to live in it. The home cannot be rented.

Some programs involve a grants for the downpayment. These programs have a set of requirements similar to those stated above.

Each county has a different program, so it is necessary to have a general idea of where the borrower intends to live. There are many hoops to jump through, but to a bonafide buyer willing to work with the agency, these programs can make the difference between being able to purchase a home or not.

Available for all Home Buyers – Metro Mortgage Assistance

Last year the Denver metro area had several cities that offered to give home buyers 4% of the mortgage amount. It can be used for downpayment or closing costs.  I wrote about it here: Mortgage Downpayment Assistance is Back!

This is a special grant program for low and moderate income individuals and families that seeks to bring the dream of home ownership within reach.

This program is a “first-come, first-served” program, expecting to last for two years.  Assuming the money holds out home buyers can benefit by using  it through 2014.

VA Home Loans

VA home loans are available t qualified military personnel exclusively.  In general, active duty and honorable discharged service personnel are eligible for the VA Program. In addition, home buyers who have spent at least six years in the Reserves of National Guard are eligible, as are spouses of service members killed in the line of duty.

Veterans who qualify can borrow up to 100% of a home’s purchase price and have no mortgage insurance.  Interest rates on VA loans are frequently low compared to conventional financing, making a VA loan a very wise choice for a military buyer who has less than 20% to put down on a home loan.

Take Advantage of Low Interest Rates Now

The housing market in Metro Denver continues to be strong.  We have many buyers interested in leveraging the remarkably low interest rates into a home purchase this year.  IF you have questions about the process or what program might be available to you, please feel free to call, text or email me.

I welcome the opportunity to assist you.




Tricks of the Trade ~ Use an Escalation Clause to Outbid Competition


Getting Your Offer Accepted! – Write an Offer with an Escalation Clause in the Case of Multiple Offers (Part 11 in a Series)



How to win when everyone wants the same one!

How to win when everyone wants the same one!

Have you found the home you want to buy and are now writing an offer? Did you just learn there are other parties writing an offer on your home too?

Welcome to a Seller’s Market!

Denver real estate is currently experiencing a shortage of inventory but an abundance of buyers looking to take advantage of the low interest rates. This situation doesn’t seem to be easing up especially in the price ranges less than $350,000. The lower in price the house it the more competition there is.

If you are serious about winning the bid there are some things you can do to assure the seller likes and accepts your bid above all others.

Now is not the time to play “Let’s Make a Deal!” Now is the time to show the seller your good intent by offering a price on the home that exceeds the list price and includes and escalation clause.

 What is an Escalation Clause?

Escalation Clauses are used in the case of competing offers. When there are more that one offer on a property an offer with an escalation clause will kick in. Typically such a clause will indicate the buyer is willing to pay $X more than the highest offer increments of $2000.00, up to a value of $X

So in simple terms say the house is listed for $300,000. There is a competing offer for $315,000. The escalation clause would make your offer $317,000.

How do you know there actually is a competing offer?

Good question, it’s hard to trust when money in involved so within the escalation clause there is a stipulation that the listing agent must show the competing offer along with the lender letter indicating that the other buyer exists and can actually purchase the property.

 Do Escalation Clauses Work?

In theory they do work, but as I’ve been discussing though out this series, sellers have different goals. Sometimes price is only one part of those goals. If your offer isn’t up to the seller’s standards in terms, personal property, conditions, and/or closing date then the escalation clause may not work.

You can also get out bid. The competing offer might have offered more.

Escalation Terms

There are no set rules for how large an increment you need to set or how high you should go. Knowing what the other offer is would be helpful, but that knowledge isn’t something we are privy too. Some homes are bid up tens of thousands of dollars and others only a few thousand. It really depends on the value of the home and the potential future value. If you don’t feel comfortable bidding the home up, then don’t.

Escalation clauses are meant to help secure the home in a rising market. It is another tool to accomplish a goal.

Begin your home search online right here!

If you are just starting the home buying process and are in need of an experienced buyer broker, pick up the phone and give me a call.  I work hard to make sure my clients are the ONE WINNER! Call direct 720-279-4599




Tricks of the Trade ~ CTM Digital Contracts are a Professional Plus

Getting Your Offer Accepted ~ Be sure your offer is professionally written using CTM digital software (Part 10 in a Series)

There will be only One Winner, let it be YOU!

There will be only One Winner, let it be YOU!

The Objective is To Look Good in the Crowd of Offers!

When a seller receives only one offer on his/her house, usually that offer is the one they work with assuming it has acceptable terms. In a seller’s market where it is not unusual to receive multiple offers the importance of having a well written offer that is presented in a professional manner becomes critical.

Let me illustrate this by telling a story. Recently I had a listing that was very appealing in price and location. I received 17 offers on it within 48 hours.This is not normal but due to the price of the property many buyers wanted it.

The first offer was for less than 1/2 the listing value. These offers come in without the buyer even looking at the property. The following offers were more realistic with a variety of terms.

Messy Offer is Not a Good Reflection on You

One offer was scanned and emailed to me so it arrived in a pdf that I had to read sideways. Frankly, it was too much trouble for me to insert it into a reader to look at in a normal reading manner. I was able to tilt my head to read it and determine the terms, which I was recording on a spreadsheet.

I thought at the time how unprofessional the offer was. It was hand written and half the blanks in the contract were not filled in. If we were to accept this offer I would have had to counter the offer filling in the necessary terms so we could proceed.

Needless to say this offer was not a serious contender.

Free Works but You Might Get What You Pay For…

Several of the other offers were written on the FREE digital contracts that are offered by our licensing agency. Nothing wrong with this, but this system is not commonly used because it is not seamlessly coordinated with both sides. It basically lets the buyer sign the doc online then the offer gets emailed to the listing agent, who then needs to use another program to let the seller’s sign digitally. It is a cheap way to write offers with no regard to integrating the entire contract and all the other forms.

The rest were written on the CTM digital software officially sponsored by the Colorado Association of Realtors.

What this means is because I use the state officially sanctioned software, our transaction would move smoothly between all the parties working on the contract, including the buyers, seller, lender and title company. All parties can log into the dashboard where the contract and addendum’s are stored and be able clearly read the documents. Being able to read the docs seems like something that should be expected, but it wasn’t so long ago that we used fax machines. After a contract is faxed a time or two, clear reading was difficult at best.

It’s because of this fact that the real estate industry has embraced digital contracts. Yes, it’s easy to sign digitally saving everyone time, gas, paper and ink, but most importantly we leave a paper trail we cal all actually read!

Some agents in our industry have yet to embrace technology. I don’t understand professionals who refuse to do so. Perhaps they don’t do enough business to warrant paying the small fee for digital contracts, if this is the case I question their dedication to the business.

When there is a strong chance that your offer will be competing with others it becomes even more important to look good, really good. Using the most widely accepted contract software will be a plus.

 Anxious to Find a Home? Begin Your Denver Home Search Here!

If you are interested in finding a new home now or in the near future, please call me for a consultation. I welcome your call!

Call direct 720-279-4599

Tricks of the Trade ~ Include a Pre-Approval Letter with Your Offer

Getting Your Offer Accepted! ~ Write an Offer with a Pre-Approval Letter from a Recognized Lender (Part 9 in a Series)

Denver Real Estate is Hot

Don't be a gambler with your financing!

Don’t be a gambler with your financing!

Polishing up your offer with a pre approval letter from a recognized lender will get a gold star from the listing agent. Why? Because so many transactions fail to close because buyers have chosen a lender based on a TV/Radio ad touting awesome rates.

The reality is, a lender can promise you anything, what counts is how they deliver. Working with a lender that is local, someone you can meet in person, look into their eyes and know most likely they will deliver what they say is so important.

I joke how it’s important to have someone local because you can be standing on their doorstep when they need a push to get things done. Local lenders like me build their business on delivering what they promise and being there to solve problems when necessary. Working with someone who comes highly recommended because of past successes eliminates cause for worrying about the unknown.

Choosing a lender can be a crap shoot. You never know if you made a wise decision until the very end. Asking for a trusted referral from a lender with a good track record is a wise course of action.

Pre-qualified is not the same as Pre-approved

Many buyers mistake pre-qualifed for pre-approved. There is a huge difference. A pre-qualified letter is merely the first step in getting a loan. Basically this qualification only checks the surface debt/income and makes an assumption the buyer has good credit and no skeletons in the closet (judgements/liens). With a pre-approval the lender makes investigations into the credit report and verifies the income/debts before they issue a pre-approval letter.

Pre-approval is just that. The buyer is approved pending the home they purchase. All that is needed is an inspection and appraisal in order to approve the loan.

Always go for the pre-approval letter. If you intend to purchase a home at some point in time, a pre-approval letter will be a strong negotiation point in your favor.

Don’t be a riverboat gambler, go with a proven method when getting financing for your home.

Need a Buyer Broker?

If you are in the market for a good negotiator who will represent your best interests when searching for a home. Call me.  I welcome your call!

Call direct 720-279-4599







Start your Denver Home Search here.

Tricks of the Trade ~ Choose Specific Performance to Show Your Strong Intent

Getting Your Offer Accepted! Write an Specific Performance Offer instead of Liquidated Damages (Part 8 in a Series)

Tempt the Seller with Your Best Offer

Tempt the Seller with Your Best Offer

Would be home buyers are finding it more difficult to purchase a home with the current conditions in the market. Denver real estate is experiencing a shortage of homes on the market yet there are plenty of buyers looking to buy. This causes buyers to often compete with other bidders for a home.

Competing means the seller will review the offers and decide on the Winning One based on criteria that is important to him/her. That might be the most net to him or it could be the offer from the buyer most likely to close!

All offers are not equal, some are written better than others. That is what this series of “Getting Your Offer Accepted” is about.

Make Your Real Estate Offer Stand Out!

Colorado Purchase Contracts provide for the buyer to purchase the house as Specific Performance or Liquidated Damages. This provision relates to the seller’s remedy if the buyer should default.

If the buyer defaults on the “liquidated damages” contract the seller is limited to the amount of the earnest money as full settlement.

As in the case of “specific performance” the seller is not limited to the earnest money but can pursue damages in addition to retaining the earnest money.

Obviously a specific performance contract has more clout! If you as the buyer want to send a message to the seller that you are serious about your offer, this may be the way to go

As specific performance contact alone may not help you win the bid, but it certainly will help when combined with a few other strong selling points that are important to the seller.

Strategy Needs to Fit Your Goals and Ability

Preparing a strategy that works with your needs and ability is important. That’s why it is necessary to work with a buyer’s agent who will listen to your needs and help you make a plan that will result in getting your offer accepted.

If you are looking now or in the near future to buy/sell a home, please give me a call.

Begin Your Denver Home Search Online

Call direct 720-279-4599