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Low maintenance Manitou beauty! Shows beautifully! Log accents on main level give a comfortable feel. Large kitchen and dining area. Huge master suite with walkout to patio. Perfect for an evening glass of wine or morning coffee. Two more large bedrooms round out the upper level. Stucco exterior. Extensive patio area for outdoor entertaining plus large front deck to enjoy mountain views. So unique and inviting. Xeriscaped for easy living. This home features over 2500 square feet plus a huge garage. See it now!

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This cute bi-level home is ready for quick closing and move in. Owner has added a few custom paint touches to the already beautiful decor. Good sized eat-in kitchen. Formal living room plus a cozy family room with fireplace in the lower level. Total of three bedrooms and two baths. Large deck for outdoor entertaining. Over 1300 square feet of living space.

Located in the Sundown area, this property is close to everything! Schools, parks, shopping. Easy commute to Peterson AFB or USAFA. Perfect for first time buyer who wants to just move in and enjoy! Contact me for more details on this property or financing options. This one will sell quickly so don’t wait!

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This bank-owned bungalow is close to everything in Old Colorado City as well as downtown! Some interior rehab has been completed-paint, kitchen, drywall etc. Only a few cosmetic updates are needed to complete the look. This listing is new on the market and the bids will be submitted beginning next Saturday. We expect multiple offers on this one!

The house has two official bedrooms with a third room that will work great as an office (no closet). Newer attached garage will keep your car warm all winter. Cute open kitchen with newer appliances. Wood floors throughout the entire home.

Don’t miss out on this one! Call me today for your private showing. 719-264-7777

Once you have an accepted contract, the fun begins! All REO assets are sold in “as-is” condition. This means that you can do your inspection for informational purposes only. When the seller negotiates the sales price with you, they do so and make you agree that you will not try to come back with a reduction in sales price to compensate for things that are wrong with the house. The only exception for this is when the buyer is an owner occupant using FHA or VA financing. If the lender require repairs then it is possible that the seller may agree to doing them. It all depends on the requirements.

Appraisal

Sometimes people confuse the appraisal with the inspection. The appraisal is ordered by the lender for the buyer. The appraiser will visit the property to take measurements and photos inside and out. Then they will review the comparable recent sales and current listings to come up with a value for the property. The comps used must be within the last six months. If the loan is FHA or VA, they will do a surface inspection to look for peeling paint, roof problems etc. The appraiser will also require that the utilities be functioning so they can make sure that there is heat and no broken pipes or water lines. Plan to pay for the property to be de-winterized and then re-winterized again if you are buying the property between October and April. The bank considers it to be the responsibility of the buyer to take care of the cost of doing this. Most plumbing companies will do this for a cost of around $150.

Closing

Most banks use contracted title companies. What does this mean to you as the buyer? These companies won the bid to work for the bank by being the lowest bidder.  Most real estate agents have a preferred title company that they like to use. Unfortunately, unless you as the buyer want to incur a lot of extra expense, you will want to use the bank’s title company for closing services. Since we are in Colorado Springs and most of these title companies are in Denver, you have the option of closing in Denver (think traffic) or closing at a location of your choice using a mobile closing service. This works just fine 99.99% of the time so no worries. Plan to have your closing funds wired to the title company at least a day prior to the actual signing.  Allowing enough time to send funds prior to the signing will allow you to get the keys at time of signing if the seller has signed off on all of their paperwork. All banks have a clause in their addendums allowing them to charge you a per diem or daily penalty for each day that you close late. This will usually happen if the lender doesn’t perform their duties in a timely manner. It is critical to stay on top of the lender and the file to make sure the deadlines are met.

Buying a REO property can be stressful without the right real estate agent. I talk with agents all the time that do not understand the ins and outs of these types of transactions. It can be critical especially when first submitting the offer to have a knowledgable professional working for you! Contact me for more details on how you can buy foreclosures in Colorado Springs. I do this all day every day. I know what the bank is looking for. Submitting a full price offer many times is no guarantee that you will get the property. It takes much more than that. Do not rely on your mother’s friend’s neighbor to help you! The end result may just be that you don’t win the bid. I see this all of the time. My insider knowledge is an edge for you. Call me and let’s get started!

The term REO means “Real Estate Owned.” This term applies to properties that have already completed the foreclosure process and have moved into the bank’s real estate inventory. Banks are in the business of lending money and not owning property. Because of this they like to sell the foreclosed assets quickly to a new buyer. Purchasing one of these properties is not difficult but it does require some patience and a bit of skill on the part of your real estate agent.

The first thing to do if you think you want to buy foreclosures or REO’s is to contact an expert in that market segment. I happen to be one! I list and sell properties for several large national banks. This means that I usually have homes coming available in the near future that have not even hit the market yet. Naturally my buyers have an edge when buying my listings. Many properties end up having multiple offers on them so knowing what to offer is the key to winning the bid.

The first this to do when thinking about entering the REO market is to get pre-qualified. I have several great local lenders that I work with and all of them are skilled in REO mortgages. The pre-qual letter given to your by your lender is like a pass to home buying. It shows that you have the ability to obtain financing for your new property. You can also get a full blown pre-approval from the lender. I recommend this if you have time to do so. The lender will do a more thorough investigation into your qualifications as far as credit, debt and employment are concerned. This step will also allow you to get approved for specific loan programs. That can be a key thing when buying a REO property (more on this later).

Once your lender has given the all clear sign, you and I can begin looking at properties. I have several ways of searching for these properties through banks, the MLS and other sources. Many times people think they can just search the MLS on their own but are you aware that some banks will not allow the listing agent to state that the property is bank-owned in the MLS? This means that your search will come up showing only some of the REO assets but not all of them. I know where to look and have access to lists that civilians may not have. you can browse the MLS on your own but to really find the good deals you will have to get in touch with me. The good deals go fast. Blink and you will miss them!

Make an Offer!

After you have found a property that meets your criteria you will want to make an offer. Keep in mind that these homes do not stay on the market long. Lots of other people are doing the same thing you are doing–looking for bargains! This means that you don’t have time to waste “sleeping on it” or thinking it over for a few days. After you have looked at a number of properties you will know a good deal when you see it. I can run the numbers (comp sales) for you to help you with your decision and then we need to get down to business and write a contract. When we submit the offer to the bank you are required to sign the written contract, submit an earnest money check (won’t be cashed until acceptance) and the pre-qual letter or statement from the bank showing funds to close. This happens when buyers are paying cash for the property. The bank has to be sure that you have the money available to close on the property.

Banks usually take anywhere from one to 7 days to respond to an offer. If you hear something quickly it might mean that they want to counter your offer but if the offer was in the acceptable range for the seller it will be accepted. Once they accept the bank’s addendums and contract forms will be sent for the buyer to sign. These addendums usually are documents that restate the fact that the bank is selling the property in as-is condition, can charge you a per diem fee if you close late and other special requirements. These terms are not negotiable. The bank does not make allowances. The buyers either accepts or declines. Period.

Next…Inspection, Appraisal & Closing

1. Isn’t it just easier to rent than to buy?

I get this question a lot. Colorado Springs is very different from other duty stations you may have lived at. The area is large but really still small. That won’t make sense to you now but when you arrive you’ll get what I mean. We have really one county in our area (excluding the mountain communities). Finding a home takes (with a good Realtor of course) no more than a few days tops! The city is pretty spread out but once you decide on a price range and area amenities, we can narrow things down pretty fast. As a rule, I do not show rental properties. Finding a rental takes as long or longer since you have to set up the showings and then meet the owner or agent at each property.  If you are not familiar with the individual areas it could take a while and then you might find yourself in a one year lease in an area that you really do not like.

2. Is it difficult to get financing?

Not as difficult as you might think. The key is to get pre-approved prior to packing up at your current duty station. Bank statements, tax returns etc. are much easier to obtain prior to moving since you have quick and easy access to all of your personal data and records. When you arrive as a pre-approved buyer you will only need to find a property and get the appraisal done in order to close. Very simple!  Loan guidelines are very clear these days. The lender can tell you up front whether or not your credit and income levels meet those guidelines. It takes just a simple conversation with the lender to find this out.

3. Where will we live while we wait to close?

Again, if you have already been pre-approved the closing can happen quickly. In Colorado we do not do “Escrow” closings. We close and fund the transaction on the day of closing and you get the keys to your new home. We can close in a matter of a few weeks. It also may be a possibility that you can move into the property prior to closing and rent from the owner until the transaction is finalized. This won’t be possible if you are buying a bank-owned property but in that case it may be worth waiting for if the price is right! There are many possible places to live in a temporary situation in Colorado Springs. Our community is used to military personnel coming and going so we have extended stay hotels, temporary furnished apartments and of course you can also check out the base TLF or on post Guest House.

4. Do I have to have 20% down payment to buy a home now?

No! Conventional loans require a larger down payment but if you are military you most likely have the option of using your VA loan benefit. This options require ZERO down payment! Also, it is just a myth that you can only use your VA one time. It can be used multiple times with conditions. FHA is also a good option that only requires a down payment of 3.5%. Contact me so I can explain these loan programs in detail.

5. Do I have to make a separate house hunting trip in order to buy?

If time or finances did not permit an advance home buying trip do not despair. The process is just not that difficult. Lots of times we work with people who really thiought they would be renting a home. Once they viewed the selection of rentals in their monthly price range they change their minds and look into buying a home. We can adapt to this situation quickly. The key is to work quickly as far as submitting the loan paperwork. In a pinch you can obtain your LES and W-2 statements along with bank records by going online and printing them. Again, we are used to helping military people settle into their new homes quickly and with a low level of stress!

As you can see, buying a home might just be easier than you thought! Even if you are PCS’ing from overseas, we can help you find a great home! Contact us to get started.

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I contacted the listing agent to ask if there had been any previous testing done on the property. After she had quizzed the seller, the response was “They did not do any testing when they bought the house. Their inspector said that since the home had a walkout basement, there would be no radon issues.” When I got done laughing, I contacted the buyer and he ordered the tests.  Inspector Whitbeck did the test and guess what? The results came in at a level of 14.2 pCi/l. The EPA recommends that the level be no higher than 3.9 pCi/l.  As a result, the buyer requested that the seller install a radon mitigation system to lower the levels and provide safety for the new buyer and his family.

Having a walkout basement does not make any difference in whether or not a home has radon! Common sense and science tell us that if radon comes out of the soil, when a house is built on top of that soil, radon can get into the property through the floors or cracks in the floors. Some migt think that a walkout basement has more ventilation since it has a patio door instead of smaller windows. What difference would that make? None unless you left the door open 24/7.  Duh! Whoever that inspector was that told the seller this should be the one who pays for this new system! This was a costly problem for that seller!

I always recommend that my clients educate themselves on radon and it’s dangers. While there are many arguments on radon and if it is really a problem, the fact is that if you have it in your home and decide to sell, you may have to pay the cost (around $1000-1500) to install a mitigation system. Better to test and ask the home seller to foot the bill than to not test and have to pay later!

Worried about radon or other home inspection issues? Call me at 719-264-7777 so we can address all of your questions.

As of September 30,2011 the new FHA loan limits will be going down. Please remember though that this means the loan limit and not the sales price. FHA requires at least a 3.5% down payment on every loan. For a single family home in El Paso county, the new FHA loan limit will be $271,050 instead of the current $325000. I personally do not see this as a problem in the Colorado Springs area.

 FHA is meant to be a program to assist first time buyers get into a home with a minimal down payment. In our market you can find nice homes under 275K.  We also are an area where a larger percentage of the first time buyers are using their VA mortgage benefit. There are many more FHA mortgages being written these days but I do not expect the new changes to have a big impact.

If you are thinking about buying a home in the near future, contact me so we can talk about your options. The FHA rate today is hovering around 3.75% depending on credit score and a few other factors. This is a great rate! VA rates are in a simlar range. We are at the point now where buying a home is becoming less expensive than renting one. This might just be the time to take the plunge and become a home owner!

During the processing of your loan there are certain things to keep in mind that may impact your loan transaction. During the loan approval process, your credit history, income and assets are verified for the initial approval and oftentimes just before your loan closing.  So, to help ensure closing, you may want to consider the following:

 “Do”

1. Tell your loan officer of all debts or liabilities

2. Keep credit accounts current such as existing mortgages, car payments and credit cards

3.Contact your loan officer before changing jobs, quitting yourjob, or becoming self-employed

4. Retain copies of all paycheck stubs and any statements onbills being paid off during the loan process

“Don’t”

1. Authorize any inquires into your credit–that is, don’t applyfor any financing including charge cards, furniture,appliances, vehicles, boats, cell phones, cable, alarmcompanies, charge a large amount on existing credit cards, orstart any home improvements which require you to opencredit.

2. Incur any additional debts, including increases in credit card balances

3.Close any open accounts

4.Co-sign a loan for anyone

5. Sign up with any credit repair or “consolidation” company

6. Spend money you have set aside for closing

7.Make large account deposits outside of payroll or gift funds

Guest blogger: Rose M. Kelly
Mortgage ConsultantNMLSR ID10326
Professional Mortgage Associates, LLC | 1740 Chapel Hills Drive | Colorado Springs, CO 80920
MAC M1449-011
Phone 719.388.2412| Cell 719.650.8228