When buying a home you’re bound to encounter some things that you don’t know anything about. They are things that outside of the home buying process you won’t ever run into. And since the average homebuyer only goes through this process a few times in his or her lifetime, it’s understandable that these things would be unfamiliar. A couple of items that seem to be perplexing are title insurance and the property survey, specifically how easements are represented.

When purchasing a home with a mortgage you need to get title insurance and a survey. This is required for all financed home purchases. An attorney or title company typically orders property surveys. Though the buyer has to pay for this service they usually don’t need to be directly involved in the process.

What is Title Insurance?

Title insurance is just another line item expense when purchasing your house, paid for one time at closing. Essentially, it is protection for you and your mortgage company that the person selling you the house has full and clear title to the property and was able to legally pass it to you. The title insurance company investigates the ownership of the property and then insures their work. If the seller didn’t rightfully own the home, and someone else does, the mortgage company and the homebuyer are financially protected. Fortunately, issues of title defects are relatively rare, meaning that title insurance isn’t too expensive and really not something to worry about.

What is a Property Survey?

A property survey is a carefully measured drawing that shows the land that is for sale and all structures on the property. It shows how large all the structures are and how far they are from each other and the borders of the property. Most importantly, it shows setbacks and easement lines.

Wait, what? It seems like the property lines and structures should be most important, but they are not. The setbacks and easement restrictions are actually the most critical elements of the survey because those are usually where the biggest problems are found.

What is a Setback?

A setback is the required distance between the house you wish to buy and other property features. For example, a city or county ordinance (or even a homeowners association) may require that homes be set back 20 feet from the road. So even though you own your front yard, you cannot extend your house any closer than 20 feet from the road.

Other setbacks indicate how closely you can build to your property boundaries or to your neighbors’ homes. If you live in an area with natural features like streams or lakes, certain special setbacks may also dictate how close you can build to these structures.

What is an Easement?

Easements refer to property with common usage rights. For example, you may own the land that a sidewalk is on, but anyone can walk on this part of your property.

Why Setbacks and Easement Restrictions Matter

What happens if the survey reveals that part of the house (the actual structure) up for sale sits within a setback or an easement? It’s a problem! In some instances it means that part of the house will need to be torn down before it can lawfully be sold. Otherwise title cannot be passed to a new owner because someone is attempting to sell property that was not built legally.

Surprisingly, this situation is not so uncommon. It may not affect the main domicile on a property, but garden sheds or pool equipment are occasionally located in an area where they don’t have a legal right to be. In these cases your lawyer has some work to do. Hopefully, you’ll discover that the structures are grandfathered because they were erected before certain setbacks were enacted. But definitely investigate these matters fully, as doing future improvements on the property may necessitate that they be corrected in the process.

Spend Some Time With Your Property Survey

For some, the survey process is one of those “check the box” items during home buying. Most get it done and move on. But it’s important to look over everything carefully and ask questions. Surveyors are happy to discuss the survey with you, and errors on surveys can occur. Spending 15 minutes looking this over will save you the headache of having it redone down the road when you want to build or make a change on your property.

The Hightower Team  is a full service real estate team in Denver, Colorado.  We have a passion for the outdoors and for helping people buy or sell their home no matter the situation.  Give us a call, you’ll be glad you did. 303-325-5020

We continue here with a look at wind power for home use, along with sources for further research and information.

Why is wind power important?

Simply put, it’s good for your pocketbook and for the environment. At a time when saving money is on top of everyone’s mind, regardless of an individual’s financial health, opportunities to reduce the cost of basic expenses such as utilities are worth considering. And just as wind is a renewable resource, the savings on wind power are sustainable for the life of your home.

Natural gas power vs. wind power
From a short-term cost perspective, natural gas power, currently at a low price, is the better deal. However, even after considering the expense of installation, a wind power system is the most cost-effective way to go, thanks to a 30 percent tax credit for systems in service before December 31, 2016.

Environmentally speaking, although natural gas is among the cleanest of the fossil fuels, it still releases pollutants. Wind power systems do not, once the manufacturing and installation processes are complete.

In terms of reliability, natural gas power comes out on top. It’s readily available, whereas wind can be intermittent. This takes us to a look at the most ideal circumstances for wind systems to be most effective.

A flat, open expanse makes for the best situation in harnessing wind energy, as tall buildings and close, surrounding homes break wind patterns. In this situation, you have the option of going completely off the grid. In a more developed area, it’s not practical to expect there will be enough wind to run all your energy needs.

Want to see if you live in a region that has powerful winds? Find high-resolution wind maps and estimates of wind resource potential at Wind Powering America.

How does a wind energy system work?
The most common home system involves the use of turbines, which convert the kinetic energy into mechanical power. (Wind turbines/windmills are among the oldest forms of renewable energy, dating back to medieval times!) The kind of turbine you’ll need depends on where you live and how much you plan to use wind as your source for energy.

If you live in a remote area where wind is easy to come by (and height restrictions are less stringent), you have a choice of a rooftop turbine or one that sits on the ground and towers over your home. The latter can go as high as 120 feet!

As noted, living in a developed area isn’t conducive to using wind for all your power needs so a small rooftop turbine should be enough to generate the most feasible amount of energy in that environment.

Learn more about small wind systems for your home through the U.S. Department of Energy’s FAQs.

Where can I find home energy kits?
Save money at the start by doing it yourself! A quick search on the Internet yields a long list of sources for wind energy systems, so finding one will be easy enough. The key to finding the right one is doing some thoughtful research. Whether you make and install your own system or have it done for you, refer to the American Wind Energy Association for some helpful tips first.

In general, alternative home energy installation is the wave of the future. In fact, already there are those who would prefer the word “alternative” no longer be used as “renewable energy” becomes more mainstream.

Converting to renewable energy in an existing home is a major commitment. Be prepared to spend a lot of time on research, looking at the history of your energy use and predicting what it will be in the future. A growing family will gradually need more while empty-nesters may begin to use less. Saving money and “doing good” can only be positive things, but you’ll have to decide if all the work is worth it. We close with some general comments for your consideration.

Is renewable energy for me?
If you’re thinking about transitioning from fossil fuels for your energy needs, whether for financial or environmental reasons, the same considerations apply.

How much do you intend to use it? Where will you put it? (A wind or water turbine is more cumbersome than the nice flat panels of solar power.) What is your budget? What are the local zoning laws? Do you want to do it yourself?

Advantages and disadvantages of renewable sources of energy
First, the good news. The sun will shine and the wind will blow. Generations hence, these natural sources will be in abundant supply. The same can’t be said for fossil fuels.

Renewable sources don’t release toxic chemicals into the atmosphere, making them environmentally sound and safe for all.

While initial costs to transition to renewable energy can be steep, the long-term cost-savings can be substantial. If you start with these alternatives in a new home, the savings are more immediate.

As for the not-so-good news, the main drawback (other than initial costs for existing homes) relates to the first note above. While the sun will shine, there will be cloudy days when not enough sunlight can be harnessed. Likewise, the wind may be, well, less windy. These can be worked around by storing energy during peak conditions, but it will take extra effort and solid planning.

It is a German tradition, they used to use Hedgehogs but when the German settlers came to PA they used groundhogs instead

Groundhog Day is rooted in a German superstition that says if a hibernating animal casts a shadow on Feb 2, winter will last another 6 weeks, if no shadow spring will come early

Punxsutawney was first settled by the Delaware Indians in 1723, the name comes from the Indian name for the location “ponksad-uteney” which means “Town of Sand Flies”

Phil’s full name is Punxsutawney Phil, Seers of Seers, Sage of Sages, Prognosticator of Prognosticators and Weather Prophet Extraordinary, the Punxsutawney Groundhog Club in 1887 declared Punxsutawney to be the weather capital of the world

Phil is 100 years old, he is given a mysterious Groundhog Elixer, which magically lengthens his life for seven years.

Phil lives in a climate-controlled home at the Punxsutawney Library and is taken to Gobbler’s Knob and places in a heated burrow underneath a simulated tree stump and pulled out at 7:25am on Ground Hog Day.

There is only 1 Phil, all others are imposters!

If you hire a home inspection professional, you really don’t need to know exactly what to look for during a home inspection. Your home inspector will be able to point out anything the seller may have tried to sweep under the rug (or hold up with duct tape) as well as give you a time frame for when certain problems will need attention. If you are thinking, How do I do my own home inspection?ö below is a basic list of things to look for when doing it yourself. However, we suggest professional home inspectors because their extensive knowledge is usually worth the cost in the long run.

Things to Look For in Home Inspection

Buyer Home Inspections – Tip 1: Check structural aspects

Structural aspects include the foundation, support structures (like beams), and framing, among others. Cracks in the foundation, improper structural engineering and things that could potentially make the home unsafe will all be evaluated. Some people ask, Should I get a structural inspection in addition to a general home inspection? If your general home inspector finds any structural issues, you might want to get a specialized structural engineer to do a home inspection.

Buyer Home Inspections – Tip 2: Inspect plumbing

Does this property have water and gas supply lines with the proper shut-offs? How is the water pressure? Could there be anything potentially hazardous, or even just plain inconvenient, with the drainage and functional flow of liquids? Your home inspector will be able to tell you.

Buyer Home Inspections – Tip 3: Examine heating, cooling and ventilation systems

Ah, HVAC. There is a lot of hype surrounding super-efficient heating and cooling systems these days, so HVAC is often in the news. During your home inspection, all of the home’s controls and thermostats, filters, ductwork and pumps will be examined so you can decide if you want or need to keep what comes with the home purchase, or if you’re going to upgrade.

Buyer Home Inspections Tip 4: Inventory major appliances

Not all new homes come with their appliances, but most will  even if they aren’t stainless steel. From washers and dryers to ceiling fans and microwaves, you will have a complete evaluation of what works, what kind of works and what didn’t pass inspection. If you are buying a house that is a short sale and foreclosure, and the appliances have been removed, the home inspector can help ensure there was no damage when the appliances were removed.

Buyer Home Inspections û Tip 5: Scrutinize the roof

Roof inspections cover the materials used, chimneys, all the gutters and downspouts, and the things they refer to as ôflashed penetrations, which include vents and skylights. With an inspection, you’ll have a better idea if you’ll be spending autumn months digging goop out of your gutters, and if those pretty cedar wood shingles are as flammable as they say they are. But most importantly, you will know approximately how long before the roof will need to be replaced. If you are negotiating after a home inspection, roof issues are one of the most expensive items to fix or replace.

Buyer Home Inspections û Tip 6: Don’t forget attics and exterior components

Insulation? Check. Ventilation? Check. Crawl spaces? Check. All these hard to reach places are key components in a home inspection. And with a professional home inspector, he is the one crawling and climbing into these less than desirable places.

Buyer Home Inspections û Tip 7: Wiring and breakers

If you are wondering, How do I do my own home inspection? Ask yourself whether you really know enough about electrical wiring to ensure your new home is safe. At the very minimum, you want to know: Is anything going to explode or catch on fire? And if it does, are there working smoke detectors? A professional home inspector will also let you know if the electrical wiring is up to code.

What to Expect During a Home Inspection

Your home inspection should take a few hours, depending on the house size and number of accessories. Many times, you’ll be invited to tag along, so the home inspector can verbally explain what he or she is looking at and for. In addition, you’ll be given a detailed, written account of everything within a couple of days of the inspection. Some of the more tech-savvy inspectors take photos or videos of issues and supply electronic files along with a written report.

These services do not come cheap and there is really no set rate for buyer home inspections. Most will cost at least several hundred dollars depending on the region, size of home, age of home and extras such as septic systems and wells, but it is worth it not to cut corners and pinch pennies.

Hopefully everything will check out, and you can shake hands with the seller and start moving in! If not, though, you will at least have a professional opinion of anything that might need fixing or replacing before you sign away your bank account.

Where to Find a Home Inspector

A quick Google search for home inspector will give you the certified home inspectors in your area. Asking your friends or real estate agent for recommendations is also a good way to find trustworthy and qualified professionals. With all the online review sites these days, you can also find recommendations online. For a certified home inspector, visit the American Society of Home Inspectors to connect with those who have met and exceeded rigorous testing in the industry.

The Denver metro area is about to explode!  It is Tebow time in Denver! Drive anywhere in the Denver Metro area and all you see is orange and blue.  The excitement is palpable.  A friend of The Hightower Team said it was a “regional holiday”, another wrote that “Tim Tebow has brought the family together again to watch football “.  It is exciting to see so many people feel joy about the same thing.  It almost feels like the Super Bowl! Tim Tebow has certainly made his mark here in Denver, when they win tonight this town will be electric!  Enjoy the game!

The Hightower Team loves football, they also do a fantastic job helping you buy or sell your home, give us a call 303-325-5020 or visit www.thehightowerteam .com to find out more.

Go Broncos!

Buying and bailing refers to the act of buying a second property and allowing a first home to fall into foreclosure. Homeowners who purchase second properties in this scenario are typically upside down on their primary residence, meaning they owe more on their first home than it is worth in the current market. It’s likely that they had an adjustable rate mortgage and their monthly mortgage payment grew to a payment they could no longer afford. For some, an easy solution appears to be buying a second property at a depressed price with a fixed rate mortgage in order to lower their monthly mortgage payments. At the same time, they let their first home fall into foreclosure  hence the term buying and bailing.

You may wonder why a lender would loan someone money for a second property when they are already having difficulty making the mortgage payments on their first home. Typically, the buying and bailing homeowners will state in their loan applications that they intend to rent out the first property, but it should be noted that lying on a loan application constitutes fraud. Fanny Mae and Freddy Mac have instituted rules to curb the practice, but it continues. In addition to fraud, homeowners could get themselves into deep water when dealing with foreclosure and second properties.

Things to Consider About Foreclosure and Second Properties

There are two different scenarios that can occur with foreclosures and second properties. The first is the buy and bail situation explained above where the homeowner buys a second property and allows the home that has been his primary residence to go into foreclosure. The second is where a homeowner has a second property, perhaps a vacation home, and allows that second property to go into foreclosure.

When a home goes into foreclosure it will be auctioned off  usually for a much lower amount than what is actually owed on the property. The difference between the amount owed and the amount received at auction is called a deficiency balance.

How the settlement of the deficiency balance will be handled varies greatly depending on where you live and your state’s laws regarding foreclosure and the enforcement of deficiency balances. In about two-thirds of U.S. states, deficiency balances are treated like all other unsecured debts, and lenders may pursue a borrower after foreclosure by seeking a deficiency judgment. This allows a lien on the second property for the amount still owed on a previous mortgage. In states such as California and Arizona there are restrictions on lenders, and they may not have that option if the original home was a primary residence.

If you have a vacation home that goes into foreclosure, and end up owing a deficiency balance after foreclosure on that second property, the lender may file a lawsuit against you to collect the debt. This could result in garnishment of your wages, levies on your bank accounts, and/or liens placed on your property, including your primary residence, depending on your state’s laws relating to the enforcement of judgments.

After foreclosure, the lender, otherwise known as the judgment creditor, may be able to force the sale of your primary residence to obtain the money needed to pay off its judgment depending on the state in which you live. Judgment creditors are more likely to pursue a forced sale of your property if you have a lot of equity in your home. Therefore, if you have a substantial amount of equity in your primary residence, you may want to think long and hard before allowing a foreclosure on your second property. A consultation with an attorney specializing in real estate law is advisable before deciding to let a foreclosure on a second property to occur.

We were able to help many families avoid foreclosure this year which is no small feat.  It brings us great joy to help people understand their situation and help them make decisions that will help them rebuild their future and move on with their lives. 

One of our goals this year was to summit 5 Colorado 14ners to raise money for The Cancer League of Colorado.  Every summit was dedicated to one of our family members that have been affected by this disease.  We had a lot of fun with the challenge and we raise $2000 from our efforts.

We have 2 family members that are living with Alzheimer’s so we continue to support the Alzheimer’s Organization, this year we participated in the Walk to End Alzheimer’s and we had a team of 17 people and collectively we raised $2,000. We must continue to raise awareness about Alzheimer’s; it is a horrible thing to watch.

2011 was good to us, we are thankful for our many lessons.  They help us grow as people, and as a business.  We continue to strive for excellence and continue to provide the best service possible to our clients.  We hope everyone has a wonderful New Year…..we look forward to what is ahead! 

All the Best,

The Hightower Team

Travis, Abigail, Paula, Mike and Brian

These are two very common questions when people are considering selling a home. Talk to any real estate agent, and the first thing they’ll tell you about calculating home value is that location is a big factor, but not the only factor. After the big real estate crash many people are asking themselves, What is the fair market value of my home?

Most of us understand there are more factors involved in calculating home value than just granite countertops and stainless steel appliances. We also know that there are online sources like HouseValues.com that can assist with determining house values by address. HouseValues.com is one of the best ways to calculate the market value of your house because it doesn’t just use algorithms and general housing data. HouseValues.com has a local real estate expert in your area to determine the real fair market value of your home. It’s okay if you are just checking out the value of your home and aren’t actually ready to sell your house. Asking an agent to help with calculating your home value is very common in today’s economy. Many people are wondering, Could we sell our home if we had to or wanted to?

Whether you are trying to calculate the value of your home because you are thinking of selling or just out of curiosity, here are five factors to consider.

Five Factors that Help Determine the Market Value of Your Home

Home Location

Location is the key influence for calculating the value of your home. Besides the proximity of the home to a major metropolitan area or a breathtaking view, these are a few more location factors that can increase home value:

• Proximity to schools, parks and points of interest

Homes within reasonable walkability to schools or parks will strongly influence buyers with small children. However, homes that boarder school or park property lines may suffer in home value due to unwanted traffic, parking limitations and the likelihood of youth mischief.

• Neighborhood with increasing desirability

Where is new growth heading in town? Will there be any new business areas, grocery stores, or libraries in the future?

• Proximity to infrastructure

Is the house surrounded by other houses? Apartment complexes? Other buildings? The best possible situation for your home is to be situated between two other houses and located along a road without yellow traffic lines.

Homebuyer Demographics

After you buy a house, the market value of your home is affected by who else is likely to purchase the property. If the property is a perfect starter home for pre-family newlyweds, and the main homebuyers in town are senior-citizens, the fair market value of your home might be lower than you think.

Older buyers typically look for one story homes without stairs, whereas families with small children often desire homes with a front yard away from a busy street and multiple bathtubs.

Home Storage Space

The more closets, garages and laundry rooms a house has, the higher the fair market value of your home. Most homebuyers look for a walk-in closet in the master bedroom, as well as closets in high traffic areas like front entryways, bathrooms and other bedrooms.

The two-door garage is the most common size for most homes, yet three-car garages are becoming more and more common.

As for the laundry room, the washer and dryer units should be located together in a common access space without creating an eyesore.

Kitchen

The kitchen is the most active area of a home. Typically, the following features add value to the kitchen:

• Granite countertops
• Stainless steel appliances
• Gas stovetops
• Convection ovens and microwaves
• Ice machines
• Cable television access ports

Also, the proximity of the kitchen to the dining room and family room will impact the usability of the house and thus is a factor in calculating the value of your home.

Home Layout and Size

Homebuyers typically look for homes with three to five bedrooms with an average of one shower per every two bedrooms. Split bedroom plans with bedrooms on opposite sides of the house are a popular trend with modern homes. Also, many real estate professionals love to use the phrase light and bright to highlight homes with lots of natural lighting.

As for size, most residential neighborhoods will have a slight variation in square-footage and number of rooms, but they all should be within a standard deviation of one another. If resale value of your home is a big concern, it’s in your best interest to not buy the largest home in the neighborhood. When calculating the market value of your home, real estate professionals measure the homes in the surrounding area against yours, and if most of the nearby properties are smaller than yours, it can act as an anchor to drag down your fair market value.