Denver CO Real Estate Blog

How to Save Thousands of Dollars in Interest on Your Mortgage

How to Save Thousands of Dollars in Interest on Your Mortgage | MyKCM

One of the most common loans you can get to buy a home is a 30-year fixed rate mortgage. If the thought of paying for your home over the course of 30-years seems daunting, here are some easy ways to shorten that term which will actually end up saving you money over the life of your loan.

Any additional payments to the principal amount (the original sum of money borrowed in a loan), helps to cut down the amount of interest that you will pay over the life of your loan and can also help to shave years off the loan as well.

When you make ‘extra’ payments toward your loan, the key is to let your lender/bank know that you want the extra funds to go toward your principal balance as they will not automatically do this for you.

You don’t have to double your mortgage payment to make a big difference either!

If you have a 30-year mortgage on a median-priced home ($250,000) with a 5% interest rate, you’ll be responsible for a $1,342.05 monthly principal and interest payment. Over the course of the loan, if you pay your exact monthly payment, you will have paid $233,133.89 in interest alone!

Paying a Little Extra Can Pay Off Big

1. Pay an additional 1/12th of your mortgage payment every month

Benefit:...

Buyers Are Looking for Your Home, Now [INFOGRAPHIC]

Buyers Are Looking for Your Home, Now [INFOGRAPHIC] | MyKCM

Some Highlights:

  • Existing home sales are currently at an annual pace of 5.32 million and have increased on a monthly basis for the last two months.
  • The inventory of existing homes for sale remains below the 6-months needed for a normal market and is now at a 3.9-month supply.
  • Inventory remains low due to high demand from buyers who are still looking for houses to buy!
...

Is Your Home Accessible to Public Transit?

The Denver Post published an article this week on the best and worst spots in the Denver Metro Area to access public transit. 

The green splotches are the best areas for transit. The red splotches are the worst. (Courtesy University of Minnesota Accessibility Observatory)

Click here to read the article and look over the maps to see if where you live, or where you are looking to live, has easy access to public transit.

...

4 Reasons to Sell Your House This Winter [INFOGRAPHIC]

4 Reasons to Sell Your House This Winter [INFOGRAPHIC] | Simplifying The Market

Some Highlights:

  • Buyer demand continues to outpace the supply of homes for sale which means that buyers are often competing with one another for the few listings that are available!
  • Housing inventory is still under the 6-month supply needed to sustain a normal housing market.
  • Perhaps the time has come for you and your family to move on and start living the life you desire.

Source: KCM (RSS Feed URL)

...

Searching for a Home Warranty?

How to choose a home warranty in Denver

Denver Skyline

Home warranties cover repair costs for your home systems, like heating and cooling, and your large appliances, like refrigerators and dishwashers. Home warranties are particularly useful for those buying or selling a home. For buyers, a home warranty protects against unexpected issues after purchasing. For sellers, having a home warranty could attract high-paying buyers.

Beyond buying or selling your home, you may have other reasons to purchase a home warranty in Denver, such as if you:

  • Own an older home
  • Own older appliances
  • Own rental properties
  • Would have trouble paying for unexpected repairs

The cost of a home warranty depends on your location, type and size of home and desired level of protection. Some companies offer a monthly premium while others charge one annual fee. A home warranty in Denver can cost between $200 to $1,400 per year, depending on the plan. Some companies offer coverage for appliances while others don’t. Understand your coverage needs before choosing a package.

A home warranty could cover:

  • Heating systems
  • Exhaust fans
  • Garage door openers
  • Plumbing
  • Water heaters
  • Electrical systems
  • Some kitchen appliances
  • Ceiling fans

In most cases, you can customize your plan so that you only pay for the coverage you need. Some companies offer add-ons, including:

  • Washer and dryer
  • Air conditioning system
  • Central vacuum system
  • Septic system and septic tank pumping
  • Spa and pool
  • Second refrigerator
  • Stand-alone freezer
  • Well pump
  • Sump pump

Keep in mind that a home warranty...

What If I Wait A Year to Buy a Home?

What If I Wait Until 2019 To Buy A Home? | Simplifying The Market

National home prices have increased by 5.4% since this time last year. Over that same time period, interest rates have remained near historic lows which has allowed many buyers to enter the market and lock in low rates.

As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price but instead about the ‘long-term cost’ of the home.

The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year. According to CoreLogic’s most recent Home Price Insights Reporthome prices will appreciate by 4.8% over the next 12 months.

What Does This Mean as a Buyer?

If home prices appreciate by 4.8% over the next twelve months as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today:

...

The Tale of Two Markets [INFOGRAPHIC]

The Tale of Two Markets [INFOGRAPHIC] | Simplifying The Market

The Tale of Two Markets [INFOGRAPHIC] | Simplifying The Market

Some Highlights:

  • An emerging trend for some time now has been the difference between available inventory and demand in the premium and luxury markets and that in the starter and trade-up markets and what those differences are doing to prices!
  • Inventory continues to rise in the luxury and premium home markets which is causing prices to cool.
  • Demand continues to rise with lower-than-normal inventory levels in the starter and trade-up home markets, causing prices to rise on a year-over-year basis for 80 consecutive months.

Source: KCM (RSS Feed URL)

...

2008 vs. Now: Are Owners Using Their Homes as ATMs Again?

Over the last six years, we have experienced strong price appreciation which has increased home equity levels dramatically. As the number of “cash-out” refinances begins to approach numbers last seen during the crash, some are afraid that we may be repeating last decade’s mistake.

However, a closer look at the numbers shows that homeowners are being much more responsible with their home equity this time around.

What happened then…

When real estate values began to surge last decade, people started using their homes as personal ATMs. Homeowners would refinance their houses and convert their equity into instant cash (known as “cash-out” refinances). Because homes were appreciating so rapidly, many homeowners tapped into their equity multiple times.

This left homeowners with little-or-no equity left in their homes, so when prices started to fall many homeowners found their houses in a negative equity situation (where the mortgage amount was greater than the value of the home). When some of these homeowners saw that there was no value left in their houses, they just stopped paying their mortgages altogether.

Banks eventually foreclosed on those homes and the foreclosures drove prices down even further and put more homes in the negative equity category. This cycle continued, leading to the worst housing crash in almost one hundred years.

What’s happening now…

Again, Americans are seeing their home equity grow. Today, over 48% of all single-family homes in the country have over 50% equity, and yes, some families are tapping into that equity. However, this time around, homeowners are not making irresponsible decisions. According to the ...