Good question!
The short answer is, “Yes.”
The longer answer is, “Yes, because while the bank or lender may not be willing to do any repairs, an inspection still empowers you, as it informs you as to the condition of your home.”
InterNACHI agrees with me. Or I agree with them. Either way, we are in agreement.
That’s a good question.
The long answer: “A debt instrument, secured by the collateral of specified real estate property, that the borrower is obliged to pay back with a predetermined set of payments. ” (Investopedia, 2015)
It short answer: it’s a loan backed by a home.
What kinds of mortgages are there? There are a number of options you’re best served by speaking directly to a lender on but there are some basic types such as a Veterans Affairs (VA) loan guarantee (also called VA loan), conventional loan, FHA loan, or an Adjustable Rate Mortgage (ARM).
This is a REALLY GOOD QUESTION. And the answer is not short. Rather, the short answer is: that’s complicated.
Generally speaking, no. There are a number of methodologies out there on the Internets that speak to ways to do this but my advice here is (pardon the caps): PROCEED WITH CAUTION.
The circumstances of a flip are so varied I’m struggling with how to capture this is a broad overview post. I would suggest that flipping a home is not for the faint of heart. Nor should you do so (in my opinion) without a Plan B. Plan B is this: can I carry the house for the length of time it needs to sell or will it rent out for the carrying costs?
Specific to ‘no money out of pocket’: a real estate transaction costs money. There’s no two ways about it. Where does that money come from? Could be an investor, could be your account. Always, always account for these costs.
If you want to take specifics about the Colorado Springs markets, please give me a ring at 719-440-6626!
From the inbox: What’s the OCC market look like?
Here you go! This is the last 60 days market activity…
And the current pricing break out:
If buying is an option, I’d be honored to earn your business!
DATA SOURCE: PPAR MLS derived statistics
Good question! Short answer: YOUR advocate in the purchase of a home.
Longer answer: in Colorado, there are four types of working relationships — seller’s agent, buyer’s agent, transaction broker and customer. A seller’s agent represents the seller and “works solely on behalf of the seller to promote the interests of the seller with the utmost good faith, loyalty and fidelity. The agent negotiates on behalf of and acts as an advocate for the seller.”
A buyer’s agent “works solely on behalf of the buyer to promote the interests of the buyer with the utmost good faith, loyalty and fidelity. The agent negotiates on behalf of and acts as an advocate for the buyer.”
A transaction broker “assists the buyer or seller or both throughout a real estate transaction by performing terms of any written or oral agreement, fully informing the parties, presenting all offers and assisting the parties with any contracts, including the closing of the transaction without being an agent or advocate for any of the parties.”
Finally, in the customer relationship, the agent “has no brokerage relationship because such party has not engaged or employed the broker, either as the
party’s agent or as the party’s transaction-broker.”
(From the Colorado Definitions of Working Relationships Disclosure)
Looking to buy a home? I’d be honored to earn your business
Good question! The short answer: an appraisal is an independent assessment of a home’s value. This differs from a home inspection, whose primary purpose is to assess the condition – not value – of a home.
The longer answer…Before You Buy: 4 Questions About Home Appraisals
Looking to buy or sell a home in Colorado Springs? Call Rob at 719-440-6626!
Good question! A short sale is where a seller has listed their home for less than the mortgage value of the property. For example, say the market value on a home is $150K but the seller owes $170K. The seller must sale, though. One option is to list as a short sale, wherein the seller seeks the permission of their lender to sell the home at a loss. There are some consequences and risks to both sides (on the buyer side, the risk is primarily investment of time). Always consult a tax or legal professional as needed; this post is not legal advice.
Interested and/or want to know more? Call Rob at 719-440-6626 or email robthompsonrealtor@gmail.com!
That’s a good question and opinions will vary. The short answer: supply and demand.
The longer answer: we have a limited supply of rental homes and an app. 94-96% occupancy rate (recent anecdotal statements indicate it may be even higher). As a result, landlords can charge more for their properties. But even this is as incomplete answer — it’s also a function of the economics of the purchase.
Say a landlord is looking at purchasing a home for app. $135K as an investment property (single family home). This is a 3 bedroom home that will rent on average for $1106. However, the investor must put around 20% down due to the home not being owner occupied ($27,000).
Assuming $1100 a year for homeowner’s insurance and $650 for taxes, the mortgage payment on this home will be $717.38 (using the interest rate that I just recently closed an investment on). If the home rents for $1106, the spread month to month for the investor is $388.62. This doesn’t account for property management (10% or $71.74 a month) or maintenance (1% over a 10 year span) — call it $1350 for this home in a hypothetical year (or $112.50 a month). Thus, the $388.62 margin is reduced to $204.38.
That’s the anatomy of a basic deal for an investor owned home and I hope illustrates part of the core reason behind pricing…and this was a $135K home. The margins change as the price goes up without breaking the next rent price point (e.g., a $145K home won’t necessarily rent for more than an $135K home).
Looking to buy or sell in Colorado, I’d be honored to earn your business! Call Rob @ 719-440-6626
**This is not financial advice, just a practical analysis of a purchase.
Good question! In Colorado (all others, please check with your local Realtor in the group!), the Contract to Buy and Sell Real Estate allows for a buyer to have the opportunity to have a property inspected after the home has gone under contract.
The inspector produces a report for you the buyer (that’s YOUR report and your inspection!). Your agent will then draft an “Inspection Objection” for you; this document is a request to the seller to repair any items on the form. The seller will respond with an “Inspection Resolution,” which is their statement of what they will fix from that list.
This is in Colorado ONLY. This isn’t legal advice and please consult your local professionals for specific state guidance.
Looking for a home in Colorado? We can help!
Rob – 719-440-6626
I get variations of this question a lot! The short answer is, “Yes, in Colorado Springs and with a VA loan, it is possible (other areas, please consult your local Realtors!).”
Longer answer: there are three costs to a home buyer generally in the purchase process.
1. Earnest money: this is “good faith” money a buyer puts up to compensate the seller if they (the buyer) breaches contract for a non-protected reason. I’ve had a lot of success w/$500 earnest money in town. When that hasn’t worked, we try $750 or $1,000. Note: coordinate with your lender but you can often get this money back at closing.
2. Inspection costs: a home inspection costs about $280 in Colorado Springs. This is a sunk cost; even if you choose not to continue with the purchase, this isn’t reimbursable in the normal course of a purchase.
3. Appraisal: there is an appraisal cost that some lenders will charge upfront, others charge as part of the loan costs.
In sum, it is entirely possible to buy a home for an upfront cost of $780-$1280, depending on the lender and the earnest money required…and that earnest money can often come back to you.
Questions, please give me a call! If you’re looking to buy or sell in Colorado Springs or Denver, I’d be honored to earn your business.