IT’S NOT DEJA VOUS ALL OVER AGAIN….

January 2, 2014 by

IT’S NOT DEJA VOUS ALL OVER AGAIN….

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I recently saw a real estate story here at the RealtyTimes site with the headline – Broke and Buying:Financial Options for Buyers with Money Problems. The story was written by another Realtor® and actually had good advice for people who might need a little assistance with a home purchase; so, that was a good thing. It was the headline that was annoying. Now, I know that one is supposed to use a catchy headline to grab the attention of would-be readers; but, it’s the mentality that one can be broke and still buy a home that got us into trouble the last time. Remember the housing bubble and the Great Recession?

The hope and belief that anything and everything is possible in America is one of the bedrocks of our success as a nation; however, there has always been a concomitant belief that one achieves those dreams and desires through hard work and perseverance. It is when we stray away from those accompanying values of achieving dreams through effort and begin to see the things that we want as entitlements that we step onto the slippery slope of failure and disaster.

I know that the word “entitlements” is fraught with heavy political and moral baggage; but it is used correctly here. The dream of owning one’s own home is strong and pervasive in our society, but it is not something that everyone is entitled to, whether they can afford it or not. It is not something that society owes to anyone. It is something that must be striven for and achieved through hard work and perseverance.

Hopefully the lenders learned enough of a lesson from the Great Recession not to repeat the scenarios that we saw prior to the collapse, where anyone who could fog a mirror could get a mortgage loan. I suspect that the majority of them have; however, there’s always a fringe element willing to take advantage of any situation and we are starting to see those ads that holler out, “No money, no problem!” I certainly hope we are not seeing Deja Vous all over again.

 

 

John Marcotte
Marcotte Real Estate Group
720-771-9401

john@boulderhomes4u.com

Search for homes on my website @ www.boulderhomes4u.com

When thinking of Real Estate, think of John Marcotte
I’m never too busy for your referrals.

 

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WHAT EVERY BUYER NEEDS TO KNOW ABOUT BUYING A FIXER UPPER

December 17, 2013 by

WHAT EVERY BUYER NEEDS TO KNOW ABOUT BUYING A FIXER UPPER

 

Buying a fixer-upper upper can be a great idea. You get a home in a great area at an affordable price with the potential of getting twice what you paid for it in value once you’ve finished a couple repairs. This of course is a best case scenario, but it is achievable. However, there are lots of things to think about before you take the plunge and invest your time, money and personal energies into a fixer-upper. Let’s start with a simple pro and con list to help you decide if you should purchase a fixer-upper.

pro

PROS OF PURCHASING A FIXER-UPPER:

  1. Get your dream home. All home buyers have a wish-list of things they want in a home – pool, granitekitchen counter tops, built in grill, location, bay window, etc. A sure way to get your perfect home is to put in the work and fulfill your own dream list. You might not be able to find the home you want within your price range that meets all of your wildest dreams, but you can find a home with the potential to do just that.
  2. Fixer-uppers are cheaper. I was reading this and found that most home buyers purchase a fixer-upper because it’s a great deal financially. It’s in a great neighborhood, has more space or is just generally better than the other homes you’re able to afford.  Purchasing a fixer-upper is a great investment for a young couple or family because it allows you to save now on a down payment and monthly mortgage. A fixer-upper is an investment in your future because soon it will be the home you want with a higher resale value when you’re ready to sell.
  3. Great resale opportunities. Once you fix up your home, its value with increase. It may be below the average neighborhood price now but with a new kitchen, smart tech additions, fresh coat of paint and anything else you “fix-up”, your home gains resale value. Home owners spend a median of 9 years in their homes so you’ll have plenty of time to make the changes you need in order to love it and make yourself a profit once you’re ready to move on.

con

CONS OF PURCHASING A FIXER-UPPER:

  1. It can be expensive in the long run. Take the time before you buy the house to do the math and figure out if you will end out on top after all is said and done. Based on a thorough inspection of the house, add up all renovations that need to be completed in the home. Don’t forget, renovations include materials and labor costs – labor is often the most expensive part of the renovation process. If you will not be hiring professionals, consider what your time costs you.  Once you’ve assessed the amount you will spend on fixing up your home, subtract that from the estimated value of the home once it’s finished. You should deduct a little extra as well for complications that arise – there is always something that will surprise you. Whatever you end up with after that is what you should be willing to make as an offer on the home.
  2. Stress of living your life under construction. Taking on a fixer-upper is an investment and it will take time. Are you willing to live in a construction zone for 6 months or more? It can be stressful  to have the kitchen out of commission for a week while you repaint the cabinets and redo the counters so you have to be mentally prepared for the reality.
  3. Expensive mechanical/structural repairs. The best fixer-uppers are homes that need mostly cosmetic fixes which are less expensive and have the greatest impact on resale value. There are certain fixes that are more expensive than others and should be avoided if possible, not just in a fixer-upper but in any home you purchase. Not only are these renovations expensive, they’re “invisible” to the next buyer. That means once you fix them, they won’t increase the value of the home equal to the cost of the renovation job. Expensive fixes to look out for include:
    • Foundation Problems – Fixing cracks, slants and the like will cost you $10,000 or more. If your home inspection comes back with foundation problems, you might be best going with a more structurally sound and expensive home.
    • Water Damage – Water damage causes rot and mold over time and cannot be ignored in a home. Not only will you have to fix the cause of the water damage, you will also need to replace all damaged wood and materials in the home. It is difficult to estimate the cost but it will almost certainly be thousands of dollars to get everything squared away. If it’s a house with fire damage, homeowners can sell it to https://www.sellingahousewithfiredamage.com fast.
    • Sewer Line Problems – Tree roots, sagging over time or clogs can cause problems in a home’s sewer line that runs from the house to the city’s pipes. Slow drainage and backups could be a sign that the sewer line needs attention such as cleaning or repiping and it’s your job as the homeowner to fix this. A replacement sewer pipe can cost anywhere between $5,000 and $15,000 – and that’s not including labor!

Now that you’ve weighed the pros and cons and have made an informed decision, here are a few more important tips to remember when you purchase a fixer-upper

Who pays for repairs when buying a fixer-upper? The buyer is not necessarily responsible for paying for all repairs on the home. The seller, the seller’s agent, or your buyer’s agent may agree to pay for some necessary fixes or any of the parties may agree to some sort of split. Don’t be afraid to negotiate on repairs, most importantly a CO2 detector and other health or safety concerns. It is imperative for these types of repairs to be done before you move in and they are commonly paid for by the seller or their agent.

Proactively communicate with your mortgage lender during the process. It is important to ensure the financing on your purchase before putting money into renovating it. Securing a home loan is an important step in the home buying process and can be trickier if you’re buying a fixer-upper. There are special programs to help however like a Federal Housing Administration 203(k) loan. Figuring out what loans you are eligible for is a vital step in this process so do your research.

Include an inspection clause in your purchase contract. An inspection is a standard part of any real estate contract and it’s even more important when you’re buying a fixer-upper. The inspection should assure you that the home is a good investment – structurally sound, pest free and safe. Learn what is a snagging list at https://snagging-lists.co.uk/. You can hire from Certified Snagging to do an inspection for you. If the results of the inspection reveal the need for pricey structural repairs, then you will be able to back out of the deal because of your inspection clause. Just because a home is a “fixer-upper” doesn’t mean it’s condemned. The best type of fixer-upper is one that needs mostly cosmetic improvements.

John Marcotte
Marcotte Real Estate Group
720-771-9401

john@boulderhomes4u.com

Search for homes on my website @ www.boulderhomes4u.com

When thinking of Real Estate, think of John Marcotte
I’m never too busy for your referrals.

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Where to Find Gluten-Free Beer (and Cider) in Boulder

November 4, 2013 by

 

Where to Find Gluten-Free Beer (and Cider) in Boulder

By  YourBoulder.com

Gluten-Free Beer

It’s never been easier to eat gluten-free, and in a town with so many healthy eating options, Boulder is a great place for folks who are gluten intolerant. But what happens when you’re in the mood for a little imbibing?

Of course, there are tons of wine and cocktail options, but sometimes you just want a beer. Nature’s cruelest joke was to make nearly all beer undrinkable for folks on a gluten-free regimen, but some breweries are heeding the call for gluten-free beer and there are plenty of places to find these options (as well as some delicious, refreshing ciders as well) in Boulder.

New Planet Brewing

All hail this completely gluten-free brewery in Boulder! This company offers a wide variety of beers from pale ales to blondes and everything in between. They do have a tasting room, which is open for very limited hours each month (every second Friday from 4-6 pm).

Even better, they bottle it so that you can find it all over Boulder. With over60 locations in the Boulder area, it’s not too hard to get a gluten-free beer fix any time you need one.

Shine Restaurant

That’s right, this bar/restaurant/meeting place is also a brewery. When they said they wanted to be an all-inclusive eatery, they meant it and they brew their very own gluten-free beer called Liberation Ale. Add this beer to their menu of delicious gluten-free menu options and you’ve got yourself a great evening out.

Colorado Cider Company

While this is a Denver based cider company, this brewery offers a fantastic selection of hard ciders to give you a little variety to the standard cider recipe (which isn’t all that bad to begin with) and they have numerous locations all around Boulder, from liquor stores to bars and restaurants. Try some of their unique twists on the classics, such as their Grasshopp-ah, which has a slightly hoppy flavor and is still gluten-free.

Eating gluten-free is fairly easy in Boulder and with this handy little guide, drinking gluten-free should be just as simple!

 

 

John Marcotte

720-771-9401

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Boulder County Museums

October 20, 2013 by

 

Boulder County Museums

Many parks, trails, museums and open space areas are closed. Please check individual property pages for more information.
Agricultural Heritage Center

Agricultural Heritage Center

Get a glimpse into the history of agriculture in Boulder County and enjoy the rural surroundings. This site focuses on the years 1900 to 1925 when local families prospered as farmers and witnessed the coming of the Modern Age.

Dougherty Museum

Dougherty Museum

The Dougherty Museum houses a collection of beautifully restored antique automobiles, including models powered by steam, electricity and early internal combustion types. Many of the cars date back 100 years and are in running order.

Assay Office Museum

Assay Office Museum

The Assay Office Museum contains many tools and implements used in the assaying process, as well as furniture and artwork owned by the Bailey family. The assay office was the place prospectors would take their ore samples to find out whether or not they had “struck it rich.”

Nederland Mining Museum

Nederland Mining Museum

Visit the Nederland Mining Museum and get a glimpse into the world of hard rock mining days in Boulder County during the late 19th and early 20th centuries. Learn about the lives of the miners of yesteryear.

Bouldercounty.gov

 

John Marcotte

720-771-9401

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U.S. seniors lock in reverse mortgages before rules change

October 6, 2013 by

 

U.S. seniors lock in reverse mortgages before rules change

(Reuters) – American seniors grappling with strained savings following the deepest recession in generations will soon face new hurdles in tapping a tool some have used to help finance retirement: the federal government’s reverse mortgage program.

An upcoming change in rules will cut the number of borrowers eligible to draw down cash against the value of their homes by 22 percent, according to an estimate from Reverse Market Insight, and some homeowners are rushing to beat the deadline.

“I had limited options and was up against a wall. It was grim,” said Cheryl Honeyman, a widow living in Brookings, Oregon, who locked into a reverse mortgage this month. “I was lucky to get this loan when I did.”

For the 63-year-old, who inherited her home near the Oregon coast when her parents passed away four years ago, the government-backed loan means she can live on the money she gets from Social Security without having to worry that an unexpected expense could force her to sell her home.

The program is costing the government. The Federal Housing Administration is expected to spend $2.8 billion this fiscal year backing reverse mortgages. Under congressional pressure, the FHA will implement new rules on Tuesday designed to stem those losses.

The changes will limit the amount seniors can draw down, impose higher mortgage insurance fees and put in place tougher vetting of applicants. But they are likely coming too late to prevent the FHA from tapping the U.S. Treasury for a cash infusion for the first time in the agency’s 79-year history.

Reverse mortgages, available to borrowers aged 62 or older, pay out a home’s equity to the borrower, either in installments or lump-sum payments. They are repaid when the borrower dies or moves out of the house, although the borrower must still pay property taxes and homeowners’ insurance.

The loans, most of which are insured by the FHA, have proved to be a lifeline for many Americans whose savings were depleted during the deep 2007-2009 recession.

Honeyman was anxious that the value of her home had significantly dropped during the recession and would limit how much money she would receive. Her home appraisal came in at $180,000 and she was able to take a $105,000 lump-sum on the property, which was purchased 13 years ago for $220,000.

DEADLINE IMPACT

If Honeyman had qualified for a reverse mortgage backed by the FHA under the new rules, she would have owed more in insurance costs and have been eligible for less money.

Loan officers and financial advisers are preparing clients for the upcoming shift, which they say will reduce the attractiveness of the loans for a vast number of seniors.

Deborah Nance, a reverse mortgage specialist with iReverse Home Loans in the Los Angeles area, said she worries the changes will mainly hurt borrowers with lower incomes, heavy debt obligations or weak credit histories.

“Those that might have previously (had) a lump sum option to pay off mortgages might be turned down,” she said.

Nance has recommended against reverse mortgages when she hears that seniors intend to move within five years, or if they have family members living with them on a long-term basis.

The problem for the FHA is that an increasing percentage of these loans are ending up in default. A record 54,000 FHA-insured reverse mortgage borrowers — or 9.4 percent – have defaulted. That’s up from 8.1 percent in July 2011.

Unlike traditional loans, the majority of defaults are triggered when borrowers are unable to pay their property taxes or keep up with their homeowners’ insurance.(Reporting by Margaret Chadbourn; Editing by Tim Ahmann and Krista Hughes)

 

 

 

John Marcotte

720-771-9401

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Timing is Everything

September 7, 2013 by

Timing is Everything


As Tapering Nears, Homebuyers Jump on Purchase Train

Timing is Everything - As Tapering Nears, Homebuyers Jump on Purchase Train

The Federal Reserve minutes in mid-August narrowed speculation regarding how soon the Fed would begin “tapering” $85 billion in monthly bond purchases. Policy makers were “broadly comfortable” with the plan if the economy continues to improve. All told, as the economy improves, home loan rates may continue to adjust further.

Prior to the announcement, stock prices had been consolidating and stalling.

Locking in the Value
The mid-August Existing Home Sales report was also released, reaching a four-year high, as borrowers jump to lock-in deals before rates rise and leave them behind. Sales of existing homes rose six percent from the month prior and a whopping 17 percent from the previous year.

FHA Changes
There were also some recent changes to the Federal Housing Administration‘s policies and how it will view a borrower’s derogatory credit history. Allowances will now be made if borrowers experienced an “Economic Event” which resulted in a decrease of income by 20 percent or more for at least six months which resulted in serious derogatory credit, including a short sale, foreclosure or bankruptcy. Additional underwriting guidelines, effective October 15, 2013, have been amended in the area of outstanding or prior judgments or collections, including the exclusion of unresolved medical collections from the underwriting decision process.

This bodes well for borrowers who may have been seriously impacted in recent years by economic conditions and are again seeking home ownership with an FHA home loan.

Summary
Home loan rates are still at historic lows. And with the recent changes to FHA policies, it’s still a great time to think about purchasing and refinancing.

Courtesy of Brian Manning, Manning Mortgage

 

John Marcotte

720-771-9401

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U.S. new home sales fall sharply; house prices rise

September 1, 2013 by

U.S. new home sales fall sharply; house prices rise

A newly constructed home is pictured before being occupied by its buyers in a new housing development area in Vista, California March 20, 2012. REUTERS/Mike Blake

 

(Reuters) – Sales of new single-family homes in the United States fell sharply in July to their lowest level in nine months, casting a shadow over the country’s housing recovery.

Sales dropped 13.4 percent to an annual rate of 394,000 units, the Commerce Department said on Friday.

The reading, which was well below economists’ expectations, could be a sign that a recent surge in mortgage rates is weighing on the economy, although the data is often subject to large revisions.

The report could weaken the case for the U.S. Federal Reserve to reduce its support for the economy by trimming monthly bond purchases later this year.

“The higher mortgage rates are having an impact on the housing market,” said Scott Brown, chief economist with Raymond James in St. Petersburg, Florida. “That makes tapering (bond purchases) somewhat less likely.”

The government revised sharply lower its estimate for new home sales in May and June.

Yields on U.S. government debt dropped sharply and the dollar weakened following the release of the data, a sign that some investors were scaling back bets that the Fed would trim its $85 billion in monthly bond purchases next month.

Mortgage rates have risen sharply since May on bets that the Fed would soon begin tapering its bond purchases. The stimulus program is designed to lower interest rates to make it easier for businesses to expand and take on new workers.

The housing market, which has been a major drag on the U.S. economy since the 2007-09 recession, appeared to turn a corner early last year when home prices began to rise.

Last month, the median price for a new home sale rose to $257,200, up from $237,400 in the same month of 2012.

There have been indications that higher borrowing costs are having only a limited impact on the overall housing market.

Sales of existing homes, a much larger category than new homes, surged to a three-year high last month. Some analysts speculated, however, that home buyers rushed into the market to lock in mortgage rates before they rose further.

(Reporting by Jason Lange; Additional reporting by Richard Leong in New York; Editing by Paul Simao)

John Marcotte

720-771-9401

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Fannie, Freddie to start new securitization firm, regulator says

March 5, 2013 by

Fannie, Freddie to start new securitization firm, regulator says

A view shows the Fannie Mae logo at its headquarters in Washington March 30, 2012. REUTERS/Jonathan Ernst

By Margaret Chadbourn

 

(Reuters) – Fannie Mae and Freddie Mac will build a new joint company for securitizing home loans as a stepping stone toward shrinking the government’s role in the mortgage market, the regulator of the U.S. government-controlled firms said on Monday.

“The overarching goal is to create something of value that could either be sold or used by policymakers as a foundational element of the mortgage market of the future,” Edward DeMarco, acting director of the Federal Housing Finance Agency, told the National Association for Business Economics.

Fannie Mae and Freddie Mac, which were bailed out by the government in 2008, help finance about two-thirds of new U.S. home loans. DeMarco is seeking to shrink their footprint and reduce risks to the taxpayers that support the mortgage giants.

Since they were seized by the government, the companies have drawn nearly $190 billion from the U.S. Treasury to stay afloat.

By creating a new securitization company, FHFA intends to pave the way for a single securitization platform and force Fannie Mae and Freddie Mac to abandon their separate systems.

The aim is to shrink the role the two government-sponsored enterprises play in the housing system in the absence of legislation from Congress or direction from the Obama administration on their future.

DeMarco said the goal is to build a single infrastructure to support the mortgage credit business.

The new company will be structured as a joint venture that is owned by Fannie Mae and Freddie Mac, DeMarco told reporters on a conference call to discuss FHFA’s plans.

He said the new joint venture is not expected to begin securitizing loans next year. Instead, the focus will be on creating the business and hiring staff. The company will have a separate chief executive and board.

DeMarco expects Congress will ultimately decide how the securitization platform is operated and whether it should be privatized.

“We are on a path to replace the outdated proprietary operational systems of Fannie and Freddie,” DeMarco told reporters. “It could be turned to some form of a market utility.”

Fannie Mae and Freddie Mac do not directly make loans. They provide financing to banks and lenders by purchasing mortgages, which they either keep on their books or package as securities which they then sell to investors with a guarantee.

DeMarco, in laying out FHFA’s goals for 2013, said he also plans to start reducing Fannie Mae and Freddie Mac’s role in the housing finance system by shrinking their business by 10 percent in the loan market for multifamily homes.

Fannie and Freddie will also aim to complete $30 billion in single-family credit guarantee business in 2013, sharing some of the risk with the private market. Those transactions could include mortgage insurance or other types of debt securities.

The companies will also be required to reduce the less liquid portion of their portfolio of mortgages by 5 percent next year. This goal comes on top of an existing mandate that requires Fannie and Freddie to shrink their investment portfolios over time and turn over profits to taxpayers.

(Reporting by Margaret Chadbourn; Editing by Tim Ahmann and David Gregorio)

 

John Marcotte

720-771-9401

Search all homes for sale @ www.boulderhomes4u.com

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