Home Mortgage and Finance

There are currently 167 blog entries related to this category.

As many have heard, on January 10th, big changes took place in the mortgage industry.  Thanks to the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, there are new requirements for virtually all closed-end conventional residential mortgage loans.  

The changes are massive, but the most talked about change involves a category of loans called Qualified Mortgages or QM for short.  

The QM rule was developed to give lenders some clarity and protection against litigation.  If your loan meets the QM standards which include limited points and fees, 43% max debt-to-income ratio, 30 year max term, and is not an interest only loan (which most loans already comply), then lenders are protected from potential lawsuits.  

What this means to

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Is Another Seller's Market Coming?

Currently, in the City of Denver, there are less than three months of housing inventory on the market, and the average home is on the market for only 40 days. That’s in contrast to this time last year, when there were four months of inventory and homes were, on average, selling in 60 days.  Common real estate wisdom suggests that when inventory numbers drop to less than a six month supply, it’s a ‘sellers’ market.’

(Find out more about this property here.)

So, if you’re thinking of selling your house, now is a great time. At the beginning of 2013, housing prices were predicted to increase around 3%. Instead prices skyrocketed with a 12% rise in the Denver area. Will we have that same kind of growth this year?

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Tax Tips for Home Sellers

Tax season is approaching fast, and for those who sold a home this year, it's important to start thinking about how this may impact your taxes. Below are several of the need-to-know facts about tax season for home sellers.

Under $250,000? You may be able to exclude gains. Just because you profited on your home sale does not mean you have to pay taxes on it. In fact, if you're eligible to exclude your gains, you don't even need to note that you sold your home at all when you file.

To be eligible, you need to have made a profit of less than $500,000 on a joint return or $250,000 on an individual return, and the home must have been your primary residence for at least two years prior to sale.

You may not have to report

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There are many exciting things happening in the lending industry in 2014.  Here is a summary of some of the programs that will benefit home buyers in the new year.

203K Rehab Loans:  203K loans have remained unaffected by recent changes to the lending industry and allow home buyers or current homeowners to finance the cost of rehab or repair work.  The home must be owner-occupied, but can be repaired after closing with this program.

Homes for Heroes:  This program offers substantial savings for heroes in our community such as firefighters, police officer, teachers, and Veterans, with funding available in 2014.  www.cohomesforheroes.org

MCC Tax Credit:  Benefit program for first time home buyers or Veterans to receive a percentage of their

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I've been an active Real Estate investor in Denver for the past nine years and I have never seen a better time to own rental property in Denver. Two factors make investing in Denver Real Estate very attractive right now. First, rental rates are going through the roof with no sign of stopping and second, interest rates remain insanely low.

Another reassuring factor is that rental rates increased despite there being more inventory for renters to choose from. And while developers are building apartments as fast as they can, experts predict it won't be near enough to meet the demand over the next ten years or so. And with rates hovering in the mid 4% range right now, you can afford to own a rental property and cash flow it like we will never see again.

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For many renters, owning a home seems like an unobtainable goal. But if you look at the facts, it's easy to calculate whether it makes sense for you. Whether renting is better than buying depends on many factors, particularly how fast prices and rents rise and how long you stay in your home.

Compare the costs of buying and renting a home in the calculator from The New York Times below. Just enter your current rent payment and the price of home you can afford, and you'll see how quickly owning will pay off. You can even change inputs such as your rate of return on investments, condo/common fees and your tax bracket.

For example, if you were to purchase a home for $250,000 with 5% down and home prices were to increase only 3% per year (currently

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What is the Denver Affordable Housing program? It is a question I expect to answer quite a bit in the next few weeks since I just put a great affordable housing unit on the market in Stapleton. The Denver Affordable Housing Program is a program through the city that limits the maximum resale value of a home and the income a purchaser can qualify with in order to provide affordable home options in parts of the city that otherwise would be out of reach for many buyers.

Generally speaking, "affordable" housing refers to housing affordable to households that make below 80% of the Denver area median income. For this two bedroom condo in Stapleton, click here for all the details, the maximum income you can qualify with is $43,600 for a 1 person

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Loan requirements have eased up.

Typically, most people are financing their home purchase with a Conventional loan. A Loan beyond 80% of the purchase price requires mortgage insurance. The insurance can be paid monthly or paid in a lump sum by you or your lender.  

However, underwriting requirements have just eased up from the Mortgage Insurance Companies. It’s now possible to finance up to 97% of your purchase price for a primary residence or second home with easier qualifying. Just recently, the credit score requirements have been drastically lowered from a 680 to a 620 minimum score! 

Traditionally, Mortgage Insurance Companies have had their own underwriting requirements. Now some will follow the guidelines that your lender requires with

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When I woke up this morning and heard the about the government shutdown, my first thought was, how it will effect Denver Real Estate? With the market still booming right now, I always dread these types of incidents popping up and slowing things down. After doing some research though, I feel pretty confident that the shutdown won't have a significant impact on the market as long as it is brief.

The biggest area of concern with the housing market whenever there is a government shutdown has to do with the mortgage side of the business. Since 90% of all loan activity is underwritten, insured or owned by government and its affiliated entities there is inevitably going to be a slowdown. FHA loans will feel the biggest impact. FHA will continue to

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Even with the higher interest rates, buying and owning a home in Denver remains cheaper than renting, so why are you still renting? A few months ago, when interest rates were in the 3% range, it was easy to see why buying was cheaper than renting.When I tell that to renters now, most don’t believe me because of the rising home prices around Denver and rates more in the mid to high 4% range. But according to a study by Trulia.com, it is 45% cheaper to buy than rent in Colorado.

To read the full study and to understand how they come up with their numbers, click here. It turns out that Denver is still one of the most affordable cities in the country and one of the best places to buy right now. With rents still on the rise and no signs of slowing, I

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