15 Mar

Tips for the First Time Homebuyer in Colorado

 

Imagine you are at the starting line of a marathon. You’re contemplating whether your training was enough, what you ate the night before, and what you will do if things go south. You’re anticipating the reward at the end – the accomplishment of having persevered through unwelcoming territory both mentally and physically. While this narrative is about the sport of running, it could also describe the home buying process in Colorado, especially for a first time homebuyer. You need to be prepared, patient, and ready for roadblocks. But before you take off from the starting line, there’s a lot of prep work to do.

Examine why you want to buy and not rent

Maybe you think there is an opportunity to earn a return – Over time this may be true in our market as home values have been steadily rising, but unless you are very handy, or have the money to hire a contractor to renovate your home – this should be far down on your list of reasons to buy and not rent.

Perhaps you want to buy because rents are just as expensive as a mortgage. Rent Jungle reports for February 2017 show that 1 bedroom apartments in Denver rent for $1,367 a month on average and two-bedroom apartment rents average $1,748. Your mortgage could be comparable. Especially because with a first mortgage loan from RMLEFCU doesn’t ever carry mortgage insurance.

“Pride of ownership” remains one of the top reasons to buy. This one really resonates with buyers who believe buying is the best way to make an investment in their own future and the future they envision for themselves.

If all else fails, you can always leave it up to science and math with this really useful test for renting or buying.

Once you’ve decided to buy – get your affairs in order.

First, check your credit report – Make sure there is nothing surprising. Remember: don’t close old accounts and for Pete’s sake, refrain from making other large purchases if you are hoping to bid and secure a house soon.

Next, prepare copies of everything you will need to apply for a loan. At a minimum you will need:

  • W-2s or federal tax returns for the past two years;
  • Most recent pay stub for proof of income;
  • Most recent statements for any loans or outstanding debt;
  • Statements for bank accounts and other assets for the past three months;

Find out what you can afford by meeting with RMLEFCU’s loan department

The loan application process at Rocky Mountain Law Enforcement Federal Credit Union is easy, quick and attentive from start to finish. We offer competitively low, fixed rates with no PMI (mortgage insurance) to take you from renter to homeowner with a variety of repayment terms to suit your individualized situation. Our loan advisors are local, experienced and can provide fast approvals and loan letters during the bidding process.

Three reasons to use RMLEFCU for your First Mortgage:

  1. No Mortgage Insurance (PMI) – Mortgage brokers and banks require you to have mortgage insurance if your down payment isn’t high enough. We trust our members so we don’t require PMI!
  2. Lower Origination Fees – We keep your initial down payment lower.
  3. Low Fixed Rates – Your payment will stay the same for 30 years. No surprises as interest rates climb.

A word of advice: Aim for a mortgage payment that is no more than between 25-29% of your pre-tax income.

  • Find a realtor in Colorado

Many people look to their immediate social network, i.e. friends and family, when selecting a realtor. But rather than worry about whether your co-worker’s wife will be upset that you went with a different real estate agent, worry more about what an agent should be doing for you.

Here’s a few tips for finding a realtor that matches your expectations.

Once you narrow it down to a few contenders, prepare questions to ask. The most important clue is how responsive they are to you. In a market that depends on 24/7 availability, a realtor needs to prioritize your phone call or email.

  • Take a deep breath as a first time homebuyer.

Prepare for stress by remembering to be patient, aggressive, and motivated. Get ready to chip away at a wish list of things you want in a home and focus on your needs.

  • Do your research for the area where you want to live.

Are there young people nearby, or will you be surrounded by retirees? Is there new development going in that will impact your experience living there? How much of a commute are you willing to deal with? How are the schools? Even if you don’t have kids, consider how the quality of schools may have an impact when you decide to sell.

  • Find a trusted home inspector.

Usually your realtor will have someone they work with. If you decide to branch out, keep these tips in mind.

  • Don’t come to the table with baggage. The less stipulations you have as a buyer, the better.

Consider RMLEFCU your running coach in the marathon that is home buying. We have a local lending team that is experienced and familiar with the needs and wants of law enforcement officers and their loved ones. Put us to work for you and we’ll work hard to show that you’ve made a wise choice.

 

06 Feb

HELOC the Heck out of Your Home Remodel

If you are considering a home equity line of credit, or HELOC loan, to make home repairs and remodels, you are in good company. Year after year, home improvement is the #1 way homeowners use their home equity line of credit. Don’t know what a HELOC is? Watch this quick video and continue reading below.

Since a HELOC’s collateral is the equity in your home, it makes sense to put the money back into what is usually your most valuable asset.

If you live in the Denver metro area, your home value has risen, giving you a larger cushion of equity to use your HELOC for home remodeling. As a result, when you make your home more attractive to potential buyers, the payoff will be well worth the investment when you sell.

Even if you are not planning to sell for a while, you get to enjoy the value add to you and your family’s daily life from these improvements.

Which rooms and improvements deserve your attention? Thankfully, Remodeling Magazine creates an annual report revealing the costs of executing 29 remodeling projects in 99 markets nationwide as well as real estate pros’ views of how much those projects will increase a home’s value at resale. Results below are specific to Denver for 2017. Read More

20 Oct

High Value Home Improvements to Make with Your HELOC

Did you know about 50% of Home Equity Line of Credit loans, aka HELOCs, are used to make home improvements according to the US Census Bureau’s Housing Survey? It’s a common sense move since the updates you make, especially in Denver’s market, are likely to reap rewards when you decide to sell. You can even use some of the new equity in your home you’ve earned with your labor (or a contractor’s) to pay for the old equity you borrowed. Winner! Winner!

How is a HELOC different than just a loan? A home equity line of credit is more like a credit card than a loan. Once the line of credit has been approved, the homeowner decides if and when to use the money and can withdraw it from the account as needed. Payments aren’t due until there’s an outstanding balance on the line of credit.

We published a post about HELOCs and rising home prices in Denver in an April 2015 blog post and one and a half years later, the song remains the same – home prices are still HOT. The average sold home price in metro Denver was around $398,663 then and now it’s just slightly lower at $396,700.

Did you know there are also tax benefits to getting a HELOC? If you itemize your taxes, you may be able to deduct the interest paid on a home equity loan or HELOC if the loan amount is limited to $100,000. It doesn’t matter if you used the money for home improvement, or a car, or a trip of a lifetime.

If you’re ready to build equity and want to choose a midrange remodeling project that will yield the greatest return, check these recommendations. Source: Remodeling Magazine’s Cost vs. Value 2016 edition for Denver, CO.

  1. Minor Kitchen Model
  2. Front door
  3. Deck
  4. Convert attic into a bedroom
  5. Garage Door Replacement

Even if you’re not going to be selling right away, consider how your HELOC can improve your quality of life in the home you’re in now. Consider the following scenario. Your home is worth $300k with a remaining mortgage of $150k, so you have $150k of equity in the home and you decide to invest $50k in a major kitchen remodel. The average ROI on this investment is 65 percent, so the project adds $32.5k of value to the home. While you now owe $200k on the home, it is now assessed at $332.5k. The homeowner has decreased the home’s overall equity by only $17.5k, and now enjoys a brand new $50k kitchen in a home that still has plenty of equity.

Talk to one of our RMLEFCU associates today about a HELOC! Find out more about our HELOC offerings here.

22 Jun

5 Things to Do When Buying in a Seller’s Market

When you’re buying a home in a seller’s market put yourself in the mindset of a contestant on an episode of the Amazing Race. Success depends on being resourceful, keeping a positive attitude, and managing your resources.

Thankfully, Rocky Mountain Law Enforcement Federal Credit Union can offer their members competitive rates and advice in the form of these five MUSTs before you start looking on Zillow, Redfin or your favorite local realtor’ website.

  1. Get your financing in order.

    In short, pay down your debts, have money earmarked for a down payment and check your credit report so there are no surprises.

    1. Pay Down Debts – Pay the most expensive first. This is the bill with the highest interest rate. Consider moving your balance from one credit card to another with a 0% interest rate, but be faithful with your payments before the 0% offer expires.
    2. Down Payment – Aim for 10-20% of the purchase price.
    3. Credit Report – Order your free one here. Get all three at once. Check for late payments and make sure they are not erroneous, especially recent late payments. If your name is common, make sure that the address noted is correct. If you see something that shouldn’t be there, call the creditor whose name appears alongside the disputed information.
  1. Get a low interest loan.

Here’s where Rocky Mountain Law Enforcement Federal Credit Union can help. From now until the end of June we can offer 125%* for 30 year and 3.25%* for 15 year loans. There’s no requirement for private mortgage insurance and we’re offering extremely low origination fees of 0.5%.

  1. Be willing to look in different areas and during the weekday.

If there’s a great house out there but you’re only able to view it on the weekends, you might lose out. Buying in a seller’s market means meeting the realtor at the first opportunity. Having a manageable commute is important, but be willing to look for homes in areas you haven’t considered. Arvada and Lakewood are our picks if you want to live closer to the mountains.

  1. Be flexible with the closing date!

Summer and Fall are busy and maybe you have dates in mind that would be less than ideal for moving. Sorry to say, you need to make it work for the seller when you’re buying in a seller’s market. What matters most ultimately is the price you end up paying – and getting a home that works for you. Don’t get hung up on dates.

  1. Shorten your lists of must haves.

You may think you have to have air conditioning, but a swamp cooler can do just fine in this area of the country. Be open to a corner lot, replace the kitchen cabinets yourself, and don’t get stuck on the existing paint colors. Certain characteristics are non-negotiable: school districts, number of bedrooms for each child (bunking brother and sister together for the “perfect house” is not recommended). Save your long list of must haves for a buyer’s market that will eventually happen. If anyone has any guesses of when, let us know.

Buying in a seller’s market is difficult, but not impossible. Stay tuned for more home buying advice from RMLEFCU.

*Annual Percentage Rate. With approved credit. Some restrictions may apply. Applications must be submitted by June 30th, 2016 to qualify for the promotional rate and origination discount.

22 Apr

Colorado Home Prices Rising at Fastest Rate in the Country

How to use a Home Equity Line of Credit HELOCAccording to the Denver Post who referenced a report from CoreLogic, a firm that tracks housing trends, home prices in Denver rose by 9.8% year over year in February. This home-price appreciation rate is currently the highest in the United States. The average sold home price in metro Denver is around $354,000 in March 2015. It was around $344,000 in February 2015 and was around $311,000 in February 2014.

RMLEFCU is offering Mortgage Loans at 4% APR* with no mortgage insurance and ½% origination fee for RMLEFCU members. If you are trying to buy a home, please contact a RMLEFCU representative.

That’s great, but you already own a home and you don’t plan on selling anytime soon. So what does this mean for you?

How to take advantage of low interest rates and the increased value of your home. Read More

02 Mar

Put Your Home’s Equity to Work with a RMLEFCU HELOC

How to use a Home Equity Line of Credit HELOCRMLEFCU would like you to put your home equity line of credit (HELOC) to work! HELOC’s are a great way to consolidate debt, pay for college, or make home improvements. RMLEFCU even has the convenience of making your home equity line of credit available with a visa card, perfect for emergencies or long-term projects. Not sure about all the details concerning home equity? Read on to learn more!

Read More