Deciding to Buy

Many things to Consider

Whether you are a first-time home buyer or are thinking of purchasing your next home, you’ve probably been given advice from friends, family and co-workers, many of whom are encouraging you to buy a home. However, you may still wonder if this is the right time or even if buying a home is the right thing to do. Knowing you are making an informed decision takes the stress out of the process. This site provides you with both general information about buying a home and information about buying a home in Colorado and also relevant links to other sites.

Today’s housing market in the Denver area is changing rapidly. There are some challenges and also great opportunities for buyers. The interest rates are still low and housing prices are the best they have been in 7 to 10 years and sometimes better.

Please contact us with any questions or for a free individualized consultation focusing on your needs.

Steps to Purchasing a Home

Lender Pre-Qualification

For some reason people hesitate taking this step. This is really for the buyer’s benefit and doesn’t obligate you to anything.  All it involves is talking to a lender, which is a great time to ask questions about interest rates and types of loans available. You can also talk to the lender about payments and what you can afford based on where you want your mortgage payment to be.  In Colorado a lender’s pre-qualification letter must be include with any offer.  So the sooner you get this step out of the way the sooner you can move forward. The lender will ask you some pertinent questions, such as

  • what is your monthly income ?
  • what your monthly credit card bills are, an estimated average?
  • do you have money for a down payment and how much do you have?
  • do you know what your credit score is?
  • will you be the only one seeking the loan or will your spouse be on the loan as well
  • what type of a loan are you interested in pursuing?
Loan PreApproval/Approval

This should ideally have been initiated prior to finding your perfect home and can  progress while you are looking at homes. To initiate the approval process you will have filled out a loan application and given the lender permission to pull your credit report. The lender then examines your credit report, your income, and your expenses and determines how much you can borrow and what the interest rate. You will be asked to provide the lender with various documents to verify your finances and income.

Final approval is given after your file has gone through underwriting and you have met all of their conditions. (See Underwriting below)  Closing then follows shortly after that. They won’t start the  final approval  process and underwriting process until you have gone under contract on a home.


This is often considered the “fun” part.  You should meet with your agent and talk with her/him about the type of home you want, the location and of course the  price range (which your lender has helped you determine).  How soon do you need to purchase and be moved in by? Do you have any other special requirements such as allergies or accessibility. Your agent will then look through the homes that are listed and provide you with a list that meet your criteria.  You will go through this list and choose the ones that you want to see.

Basic questions on criteria:  How many bedrooms, how many bathrooms? — do you want a garage and how many spaces? — do you want a basement?– Location? — What type of property: townhome, condo, single family, duplex, farm, ranch… — Big yard or small yard? — Style of home: ranch (1-level), 2 story, tri-level …?  And many more questions.


Once you have found the right home you will work with your agent to determine the best price to offer.  Your agent should offer to prepare a report on similar properties that have recently sold  and help you interpret that to determine your offer price.  The agent will the create a “Contract to Buy and Sell” and you will sign it.  You will then be asked to write a personal check or get certified funds for the “Earnest Money”.  And your agent will contact your lender to get a pre-qualification letter.  A copy of the  Earnest Money check and the lender letter will be included with the offer  and sent to the listing agent.

In the “Contract to Buy and Sell” there is a date table which your agent will also go over with you. The date table establishes the deadlines for you to do your due diligence on the property everything from reviewing the title and HOA documents to the inspection and appraisal. This is where the works really begin for your Real Estate agent and why you need to have chosen a knowledgeable and experience agent to look out for your best interests and help you manage these dates and deadlines.


The listing agent will present your offer to the seller and the seller will then decide  one of three things:

  1. Accept your offer — in which case they will sign “The Contract to Buy and Sell”
  2. To counter your offer — return a “Counter Offer” with a different price or terms or dates or all three
  3. Decline your offer
If the seller counters your offer then you will need to decide if you will accept there counter or you can counter their counter.  This is where you will find a good real estate agent invaluable. This can go back an forth for a while until all parties are satisfied or one party can choose to decline (terminate) negotiations.

Once The Offer Is Accepted; You Are Under Contract And The Work Begins

Once the offer is accepted your agent will have you sign the disclosures if you haven’t done so already. The agent will give your lender a copy of the contract and counter (if applicable) so that he can start processing the loan.  The title company will also get a copy of the contract and any counter so that they can begin processing the title work. And you will start your “due diligence”.