No matter how prepared you think you are, sometime you find yourself unprepared.   Last weekend when I was in Denver leaving a concert, I encountered a bear.   Not any ordinary bear.  This was a HUGE bear.  The bear was staring into a building.  And even more interesting was the fact that there were spaceships flying in the building! 

So, here I am, in downtown Denver,  looking at a bear staring into a building with spaceships. And, all I had was my cell phone camera.

My Google research tells me that this bear, sculpted by Lawrence Argent, is 40 foot tall. The title of the scuplture is, "I See What You Mean."  Supposedly, in the day light the bear is blue.  Hmmm.  The building, located at 700 14^th Street in downtown Denver, is the Colorado Convention Center.   At this point, I have not been able to find out anything about the spaceships .  They might not have even been spaceships.  Whatever "they" are, they looked like spaceships to me.    

Only in Colorado ......

Moral of the Story:  Keep a good camera with you at all times.  You never know what you are going to encounter, especially in Colorado. 

Photographed,

written and posted by

Sondra Meyer CPA/Real Estate Broker

Star View Ranch, Real Estate & Financial Advisory Services

979-575-2700

Final Prep For Denver Big Air At Civic Center Park

Today we had some free time during the day so we took a quick drive from Highlands Ranch towards downtown and checked out the final preparations for Denver Big Air in Civic Center Park.

One word.

Amazing.

A giant 102 foot ski jump in the middle of downtown Denver nestled between the Denver City and County building and the Colorado State Capital.  Of course normally you would be driving up to the mountains for this type of event.

The one downer was that there are gates everywhere and We really could not get as close as I would have liked.  I REALLY wanted to stand on the City and County building steps and take a photo form the bottom.  But no can do.  My wife and I even begged some security guards in the City and County building if we could get in and take photos from in there, no can do, again.  C'est la vie.  So for the time being these pic will have to do.

Here is some video that I took of a big crate of snow being lifted up to the ski ramp and jump. Definitely not something you see every day.

Personally we are not going to attend the actual events this week, my son is still in a cast and his foot would freeze outside at night.  But I was glad to have the chance to see this amazing structure come to life.

People sometimes ask me when they are deciding between 2 cities - why move to Denver.  I often tell them, we do get attractions and events that other places do not.  Denver Big Air is one of those events - this is the first time the annual Big Air competition has been in the U.S.  Gotta love Denver!

Originally Posted at my Denver Real Estate & Relocation Blog

If you are having friends or family to visit, you probably are wracking your brain trying to figure out what to do when they're here.  Well, Yahoo is going to make things easy for you and tell you where you should NOT go!  Yup, don't even waste your time!

1. Casa Bonita - My friend Jeff DiMuria said it best.  Check out Jeff's blog on this
2. Colorado's Ocean Journey - This place used to be OK, then it was bought by a restaurant.  Enough said.
3. 16th Street Mall - A mall is a mall is a mall.  OK?
4. Denver Mint - I dare you to get a reservation, I dare you!
5. Adolph Coors Brewery - Do you really want to drive to Golden for 1 free sample?
6. Denver Botanic Garden - Aren't there Botanic Gardens in every other large US city?  Save your money and time.
7. LoDo's restaurants - The bars here are crowded and noisy and pricey.
8. Elitch Gardens - Small park for the price, I'd rather go to Sea World. 
9. Buckhorn Exchange - Good food but pricey, more of a old west museum.
10. Platte Trolley - It costs $5 and the trolley experience is better in San Francisco.

Forbes Magazine, which only 10 months ago dubbed Denver as America's best city to buy a home -- now declares the Mile High City the second-worst housing market in America.

"Denver doesn't come to mind as a housing-crisis hot spot, but the city that once looked like it would escape the housing bust unscathed now shows signs of strain," Forbes said in its report. "More than 42,000 homes are on the market in the Denver metro, 27 percent more than last year."

Forbes said it evaluated U.S. metro areas with more than 1 million people, ranking them on increase inhome inventory as well as changes in single-family home sales, up or down, between the fourth quarters of 2008 and 2009.

Milwaukee ranked as the worst U.S. housing market in Forbes' report, followed by Denver, Los Angeles and St. Louis in a tie for third, and San Francisco.

Only last June, Forbes raved about Denver as a place to buy a home. "While the majority of the nation's housing markets are still working toward a bottom, some cities are boasting fundamentals that make them good places to buy a home now," Forbes said then.

That list was based on change in price per square foot, frequency of real-estate transactions, and how evenly distributed home-sales activity was in each metro area.

And in May 2009, Denver was named America's No. 1 city on the verge of a real estate recovery in a segment on NBC's "Today" show. Real estate expert Barbara Corcoran, a regular guest on the show, said Denver more than any other U.S. city is "clearly on a rebound."

Read more: Denver Business Journal

Loan Considerations for Buy and Hold Investors


As far as investment loans, little or no money down loans are impossible.  However, lenders do permit the use of Home Equity Lines of Credit or second mortgages from other properties owned by the borrower as a source of down payment.  Or, self-employed borrowers are using funds from business lines of credit to fund down payments or renovations (please note: there are asset seasoning guidelines for doing so and the debt incurred by accessing other credit lines must be accounted for against the borrower’s debt-to-income ratio). Thus, we have clients leveraging themselves with other homes they own in order to get in with little or nothing down. 
There are exceptions, but practically every lender requires Full Income Documentation on any investment purchase.  Full Documentation requires the proof of income through W2s, pay stubs and/or tax returns, as well as proving liquid assets with bank statements.  The max LTV is 85% on a non-owner single family property (75% for a 3 - 4 unit); however, most homes are being affected with the ‘declining market’ tag.  As such, the maximum loan permitted would be 80% of the purchase price.  This is due to mortgage insurance companies refusing to provide MI on investment properties in declining markets.  Also, if an investor does not have landlord experience in the past two years, new rules will now not allow any rental income to be included as monthly income.  Hence, the buyer would need to qualify with the entire payment going against his/her debt-to-income ratio.
Another point to keep in mind is that Fannie Mae and Freddie Mac are only permitting a maximum of 4 financed properties on a borrower’s credit report.  Hence, if a borrower is looking to purchase or refinance a fifth home and already have four loans on their credit, they will face a tremendous challenge in securing financing.  This latter rule only affects someone purchasing or refinancing an investment property/second home and NOT an owner occupied purchase.
All this being said, if an investor can put down 20% (or borrow a good chunk of that 20% from other homes they own or lines of credit), is Full Doc, with a 680+ credit score and DTI below 50%, rates are in the upper 6% range on 30yr fixed mortgages with no prepay penalties.  With home prices bottoming up in most neighborhoods, coupled with a bullish rental market with increasing rents and low vacancy, investors can easily generate hundreds of dollars of cash flow per month.  In fact, many investors choose 15 year fixed mortgages to pay off the loan quickly, yet still cash flow tremendously. 

Loan Considerations for Fix & Flip / Short-Term Investors


Securing conventional financing on a fix & flip or short-term loan is not recommended.  Most conventional lenders sell off their mortgages to investors on the secondary market.  If the loan is paid off early (before six payments are made), the investor has not recovered their initial investment.  The investor will attempt to recover their loss from the lender, who will ultimately come after the loan originator.  The loan originator would then be obligated to pay back any premium paid out by the lender.  If such activity becomes habitual with the loan officer, the lender can cease doing business with them and their firm.

Furthermore, conventional loans require conventional appraisals.  The lender will require that the home is a) habitable in its present state b) in at least ‘average’ condition and c) not in need of any repairs greater than 2% of the purchase price.  All three points can be challenging to overcome for investments properties, especially bank owned homes.  Consequently, many investors use private money, hard money, home equity lines of credit, cash or specialty investment lenders to avoid failing a conventional appraisal.   All of the aforementioned sources of funds can be worthwhile to pursue, but they are meant for short-term loans.  Hence, the borrower needs to have a clear exit strategy(ies) to avoid costly extension fees and holding costs.  Such loans carry higher interest rates and up-front fees due to their considerable risk.  They can be a great route to pursue; however, the investor better be prepared in case the home is not able to sell. 

Fix & flip investors should also be cognizant of title seasoning issues.  FHA guidelines require that a seller be on title for 90 days before a buyer can purchase the home with an FHA loan.  Most flips take longer than 90 days to renovate, market and actually close.   But, some deals need limited work and can be turned around quickly.  Ultimately, you will want to verify that the new buyer’s lender understands the title guidelines of the lender being used.  Furthermore, a flip investor is going to list the remodeled home for significantly higher than what they had paid for it.  The lender providing financing to the buyer purchasing the renovated home will scrutinize the new appraisal to ensure the value is justified.  Lenders got burned in the past on property flipping schemes and are wary of substantial value increases in short periods of time.

Loan Considerations for Jumbo Mortgages

For the Greater Metro Denver area, any loan amount greater than $417,000 is considered a jumbo loan.  Fannie Mae and Freddie Mac assign different thresholds for various regions across the country.  For instance, $417,000 is not considered a jumbo loan in a high cost city like San Francisco, yet there will still be higher rates for going above $417K. 

Due to the size of jumbo loans, they are considered greater risk for lenders, resulting in higher rates.  Rates have fluctuated greatly over the past few years on jumbos.  As of today, a 30 year fixed could range from 7% - 8%; a full point higher than the prime rate below a loan amount of $417,000.  Five year ARMs are popular on jumbo loans, as they typically price out a half point lower than fixed products. 

Frequently, a borrower will need to put more money down on a jumbo loan to mitigate the risk.  Investors that purchase mortgages are still skeptical of the lending industry, especially higher risk loans, which is why we haven’t been witnessing attractive jumbo rates of late.

To limit the impact on the monthly payment and secure a better rate, many borrowers will take out a first mortgage of $417,000 and then try to find a second mortgage to cover the balance.  For example, assume a buyer is purchasing a home for $600,000 and they are able to put 20% down.  Instead of taking out one loan at 80% = $480,000, it will likely make sense to split the loan into a $417,000 first mortgage and $63,000 second mortgage.  Since the combined loan-to-value is 80%, finding a second mortgage lender should be relatively simple.  While the rate on the second will be higher than the first, the blended rate will be significantly lower than the jumbo loan option, resulting in a few hundred dollar savings per month.