FHA Loan


Let’s break down the type of home buyer who would like to benefit from an FHA loan. In general, the FHA home buyer would like to only put 3.5% down. They may have less than perfect credit and have a higher debt-to-income ratio. What is debt to income? Debt-to-income is the total monthly debt divided by income. (add this formula to the video: DTI = home payment+monthly debt / income).

FHA has been known to qualify borrowers with up to a 55% debt-to-income. Also, rates are often lower with an FHA loan. The trade off is that FHA loans carry upfront mortgage insurance and monthly mortgage insurance while conventional loans only require monthly mortgage insurance when borrowers put less than 20% down. In summary, FHA loans are a great way for home buyers to buy a home with little money down.

Contact us today to get pre-approved for a home loan.

VA Loan


The VA loan can be considered the best loan available outside of private money. It offers borrowers the option of putting 0% down. The downside is the upfront funding fee which would depend on how much the borrower is putting down and /or whether the borrower is a first time home buyer or not. The VA loan also boast a more relaxed set of underwriting guidelines which allows for borrowers with less than perfect credit to own their own homes.

We at Colorado Lenders are always excited to offer the VA loan. Another trick that can be utilized with the VA loan is using seller credits to pay off existing debt to qualify. Often lowering the borrower monthly obligations substantially. Call today to learn more.

Conventional Loan


Obtaining a conventional mortgage loan can be quite beneficial over the other loan options. The conventional loan is flexible because it does not require any mortgage insurance with 20% down. And with less than 20% down it provides various flexibility in underwriting guidelines.

The ideal conventional borrower has a higher credit score and a greater down payment, however options with less of a down payment are available. The agreeable feature of a conventional loan is that the mortgage insurance goes away often when the LTV (loan to value) ratio reaches 78% of the home value. Contact Colorado Lenders today for more information about qualifying.

The Colorado Real Estate market is booming!

No matter what city you’re in, either a ton of homes are for sale, or everyone is fighting over just a few homes. This means a couple of different things. First, in the cities where everything is for sale, you can probably count on prices being at a higher level than before (that is why everyone is selling) and you may have a pick of quite a few properties. In the cities where very few homes are for sale, you can count on over-inflated prices and multiple offers on each and every property (except, of course, properties with serious problems.)

At Colorado Lenders, Inc., we are very aware of the difficulties and are prepared to work with buyers to overcome these obstacles. This means pre-approving customers to the degree possible before they go out house hunting. It also means being prepared to increase loan amounts and make adjustments to seller credits as inspections are completed.

A final comment toward the Colorado Real Estate market is that many of our clients who have invested in a home to live or rent out have enjoyed growing home values throughout the process. In fact, most all of our buyers after 6 months have accumulated between 5-20% on their home values. The statement is not guaranteed but the fact remains that home buyers around Colorado have enjoyed appreciation along with their home purchases.

If you would like top-notch personal service or are unhappy with your current lender, feel free to call or email and we will respond promptly.

Colorado VA Home Loan

Department of VA

Colorado VA Home Loans

The Colorado VA home loan is an excellent loan. Eligible Veterans, active duty members, and often reserve members of the military can get financing with as little as 0% down. We at Colorado Lenders are big fans of the VA home loan and are versed in the process used to obtain the loan.

Another advantage we have out here in Colorado is our local VA office. They are knowledgeable and organized and have proven time and time again to provide us vital information throughout the loan process.

VA home loans also have lower interest rates when compared to conventional financing, making the loan one of the best in the industry. We have helped veterans obtain financing to buy a home or cash-out of their current mortgage allowing for expensive debt to be consolidated into one home loan.

Borrowers have been able to pay down credit cards, car loans, installment loans and other types of loans often resulting in an improved credit score.

The VA loan can also be used more than once at the same time despite what people may think. The trick depends on the remaining “entitlement amount”. If a Veteran has, for example, a 250k loan and has 150k remaining on his entitlement amount and decides to move into a nicer home, he or she can borrower the 150k to purchase the new home and then must bring an additional 25% of the remaining balance to the table.

For example, if the new home costs 300k, you take the 150k off the purchase price and then are responsible for 25% of the remaining 150k or 37.5k. The borrower is required to move into the new home using this method.

Contact Colorado Lenders today to chat about your Colorado VA home loan options.

Direct 303-578-9202

Colorado Property Investment

Colorado Property Investment.

Colorado Property Investment Strategy

In current times, Colorado is an amazing place to invest in Real Estate. We are mortgage lenders and do not have the authority to suggest how, when or why to invest in Real Estate. However, our staff has funded many investment properties in the past and have picked up on some interesting strategies over the years. Again, I cannot stress enough that property investing is a personal endeavour and strategies vary from person to person and no one strategy is failsafe.

With that said, let me suggest a particular strategy that, if executed correctly, could create long-term wealth with a reasonable amount of risk.

Take an example. Imagine you buy a piece of Colorado Real estate for 300k. Most investment property loans require between 20-25% down. The down payment is usually the biggest obstacle for a real estate investor. In this scenario, 25%  would be 75k, a sizable amount of money for most. There are “other” suggested ways to buy investment properties with “no money down” but they are often flawed. The most proven and, obviously, more difficult way to do it is to save up that down payment!

Suggest that you have the down payment money saved. Remember, the down payment money for an investment property cannot be gifted from a family member like a primary residence purchase can so be sure to have the money in your bank account for at least 3 months prior to beginning the loan.

This strategy also requires more discipline than most investments. The idea is to put the loan term at 15 years instead of 30 years. This ensures much more principal is being paid every month when compared to a 30-year loan. Next, the idea is to “overpay” the 15-year loan schedule. The normal payment without taxes and insurance would be around $1,664.30. The next step would be to pay an additional 1k per month on top of the payment to further reduce the principal of the loan. If the full 15-year payment + the 1k extra per month was paid for the entire life of the loan, the loan would be paid in full in less than 8 years. From the day the last payment is made, the property then turns from a 2664.20/month liability into a 2k/month cash-flow producing property.

The idea of this strategy is to acquire between 3-10 of these properties over the next 3-10 years. With this strategy, an investor could potentially create a wealth-producing machine which would produce between 6-20k per month depending on the number of properties. Once the properties are paid off, the cash-flow remains until they are sold. Appreciation should also be factored into the strategy but for the sake of the philosophy of the investments, the cash-flow is what is most important because it does not end as long as the properties are managed correctly.

Though this strategy requires a great deal of patience and delayed gratification, it can be done, and if done properly, can set an investor up for an early retirement.

To buy an investment property or to inquire about any type of financing questions, contact Colorado Lenders, Inc today!

Happy investing!

 

 

The Colorado Real Estate Market

The Colorado Real Estate market is booming!

No matter what city you’re in, either a ton of homes are for sale, or everyone is fighting over just a few homes. This means a couple of different things. First, in the cities where everything is for sale, you can probably count on prices being at a higher level than before (that is why everyone is selling) and you may have a pick of quite a few properties. In the cities where very few homes are for sale, you can count on over-inflated prices and multiple offers on each and every property (except, of course, properties with serious problems.)

At Colorado Lenders, INC we are very aware of the difficulties and are prepared to work with buyers to overcome these obstacles. This means pre-approving customers to the degree possible before they go out house hunting. It also means being prepared to increase loan amounts and make adjustments to seller credits as inspections are completed.

A final comment toward the Colorado Real Estate market is that many of our clients who have invested in a home to live or rent out have enjoyed growing home values throughout the process. In fact, most all of our buyers after 6 months have accumulated between 5-20% on their home values. The statement is not guaranteed but the fact remains that home buyers around Colorado have enjoyed appreciation along with their home purchases.

If you would like top-notch personal service or are unhappy with your current lender, feel free to call or email and we will respond promptly.

Direct: 303-578-9202

Currently Renting: Why Not Own a Colorado Home?

Today’s expensive Colorado rental market along with historically low interest rates and home prices on the rise makes the benefit of owning a Colorado home quite practical. Whether you are ready to buy tomorrow or need some time to save up a down payment and/or establish credit and a job history, it may be well worth it to give your local Mortgage Broker a call.

Think you cannot afford to enter the home buying market?

According to Zillow, renters in the Denver market use on average 35% of their monthly income on housing, as opposed to homeowners who allocate 21% of their monthly earnings to their mortgage payments.  Data shows that it is actually less expensive to own a home vs. rent a home right now in Denver! While these numbers are revealing, we can make our own comparisons as well. For instance, let’s assume that an average three-bedroom apartment in Denver goes for $1,800 a month, which is quite realistic right now. And then suggest you would like to buy a $250,000 home instead write another rent check. An FHA loan requires a minimum of 3.5% down and as well as an upfront mortgage insurance premium (UFMIP) of $4,375. Given a rate of 3.875% for a 30-year loan with insurance of $125, monthly taxes of $150, and monthly mortgage insurance of $170.89, your total monthly mortgage payment would run about $1,600.19* You could potentially save $200 a month while owning a home amidst a potentially appreciating market.

Benefits of home ownership        

Buying a house could be one of the best decisions you could make for your financial future. Along with building equity and potentially saving money on rent, you may gain tax advantages by deducting your mortgage insurance from your federal taxes. There is no place like home especially when nobody can raise the rent on you! Colorado Lenders Inc. is a local company with competitive rates, friendly service, and uncompromising integrity. To get started, give us a call at 303-578-9202 and begin your journey towards home ownership.

* Payment assumes an FHA loan with a purchase price of $250,000.00, 3.5% down at a rate of $3.875, and taxes and insurance of $270/monthly. Currently FHA loans carry an upfront cost of 1.75% amounting to $4221.88 and a monthly insurance cost of .85% or $170.89. For the purpose of this example, credit is assumed to be above 680. All loans are subject to an underwriters approval.

Thinking of Refinancing Your Colorado Home Mortgage?

Why should I refinance?

 If you are a homeowner, then you already know the value of your house, but refinancing is a way to access some of the accrued home equity, and or a way to make living in your home less expensive. Refinancing is ideal for candidates who want to lower their monthly payments, liquidate some of the equity on your existing mortgage, or to readjust the terms of paying of your mortgage.

What are my conventional refinancing options?

 The best thing to do is to consult a Mortgage Broker like Colorado Lenders, Inc. A mortgage broker would be helpful in determining exactly what would be most suitable solution for your plans. One option you might consider would be to adjust the length of your mortgage to make it either shorter or longer. Making the term shorter is ideal if you can couple it with low interest rates because you will be paying a higher monthly amount, but less money in the long-term. Another option is to make the mortgage term longer so that you pay less per month over a longer period of time.

Screen-Shot-2015-07-31Based solely on $250,000 loan over 15 years with an interest rate of 5.5% and 0 money down

Screen-Shot-2015-07-31-2Based solely on $250,000 loan over 20 years with an interest rate of 5.5% and 0 money down

Screen-Shot-2015-07-31-3Based solely on $250,000 loan over 30 years with an interest rate of 5.5% and 0 money down

Are you or were you a part of the military? If so, you may have bought your home using a VA loan. If that is the case, an IRRRL (Interest Rate Reduction Refinancing Loan) might be the best option for you. It allows mortgage brokers to restructure your mortgage at a lower rate so that the buyer has lower monthly payments.

While refinancing, a mortgage broker can also help buyers restructure rate terms where they can change your terms from a fixed rate to an ARM, an ARM to a fixed rate, or structuring so that you can get better rates on your existing ARM or fixed rate mortgage. All of these are in attempt to save you money monthly and in the long-term.

Screen-Shot-2015-07-31-4Based solely on $250,000 loan over 20 years with an interest rate of 5.5% and 0 money down

Screen-Shot-2015-07-31-5Based solely on $250,000 loan over 20 years with an interest rate of 3.75% and 0 money down

 

How do I get cash from my house’s value?

There are three conventional methods of refinancing your mortgage in order to obtain cash from the equity accrued over time.   One popular way to do this is through a HELOC (Home Equity Line of Credit). This is a way for homeowners to access up to as much cash as their credit allows. This is practical as one usually only has to pay off the interest on the amount taken out – which is usually set at a low rate and gets adjusted monthly – until an individual is prepared to start paying the principle amounts as well (principle must be paid 10 years after HELOC into an amortized 20 year loan, so it is advisable to pay off principle as so as possible).

If you are a person who likes the security of knowing the interest rate of their payments, perhaps an Equity Loan is the option for you. They feature slightly higher rates than the HELOC, however monthly payments are made in one lump sum of the principle and the interest from the cash received.

The other popular option would be to simply do a Cash-out Refinance. This is ideal for those who have built up more equity than the amount that is due on the home. With this option you can get a second mortgage at a higher value, and receive cash for the difference of the two loan amounts. Since you for borrowing more than you originally were with the one mortgage, the monthly payments on your mortgage will be greater than they originally were, but we the added benefit of having cash from your home equity.

So which refinancing option is best for me?

 Given the shear volume of options in refinancing contacting a mortgage broker, banker or lender would be the best course of action in answering this question. However, keep in mind that refinancing could do more detriment to your financial well being than good based upon your given situation. One example of this could be if you have been under your first mortgage for a long period of time and you are close to paying off your home completely; you could be paying more to refinance than you would if you kept your original mortgage. Any refinancing servicer can sit down with you to discuss if you are a good candidate for a mortgage refinanc