Doug Van EttenYOUR JOURNEY HOMEGrand Junction Free Press Real Estate Columnist

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December 27, 2012
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Local real estate Q&A

A: Oh you bet the terms and conditions of a real estate sale and purchase need to be more formal. Colorado, like most states, requires that real estate transactions be in the form of a written contract. A written contract is binding and needs to be written in terms that are defined and legally enforceable. By putting the terms of his sale, your purchase, into writing, those terms and agreement are made clear to both of you and to any third party that might need to be involved, such as an appraiser or title company, not to mention an attorney or court.A contract will make clear the agreements and understandings as well as provide guidance or solutions for any disagreements or misunderstandings. For example, in the case of owner- or seller-financing, the contract will make clear the terms of your payment and the seller's redress in the event you miss payments, causing default. You did not ask about the initial money involved but let's touch on that briefly. In the contract you and the seller will want clarity on your earnest money deposit' any down payment; payment terms including interest rate; time and tardiness of payments; any balloon payment that may be due down the road.This "deposit" you made reference to is probably earnest money, a payment usually of 1 to 2 percent of the purchase price that essentially holds your priority to buy the property while you work through the details of the purchase leading toward closing the purchase and sale of the property. I would suggest rather than placing that in the seller's bank account, you stipulate in the contract that the earnest money will be held by a local title company. By depositing the money with a third party, where the closing will take place anyway, neither of you have to be concerned about the safety of the funds.There does not seem to be anyone in Mesa County who is tracking the number of seller-finance property sales. They probably only represent a very small fraction of the local real estate sales. For buyers like you, your best sources of information may be a Realtor, real estate attorney or the title company chosen to hold the earnest money funds and conduct the closing. Best of success to you.

By the time you read this the holiday season will mostly be behind us. This time of year there are fewer homes on the market for sale than say in March, June or August. You may be well positioned to sell if you put the house up for sale sooner rather than later. The logic goes like this: Same number of sales in a time period, less competing houses equals a better chance for yours to sell.On the subject of not getting as much for your house as you want, we need to think about what you will do real estate-wise in Denver. If you are planning to buy there, keep in mind that the Denver home sales market is appreciating, gaining value, more quickly than is Grand Junction.If you wait, for example, one year to sell your house here, the market may go up 2 percent in that time. If your home, might sell for $200,000 in January 2013, the appreciation gain might make it worth $204,000 in January 2014. In the meantime if the Denver market appreciated 5 percent, as it has done in 2012, a $200,000 house in 2013 would cost $210,000 in a year. The message for you is, in simple terms, waiting to sell here, thus waiting to buy there, leaves you at a net loss. That does not even take into account that interest rates today remain near record lows and we have no way to even guess where they may be 12 months or more from now, driving down your buying power in Denver and cutting into the number of qualified buyers for your house here.Who is that Realtor at your church? I want to commend them for giving you what I consider to be sound advice.Doug Van Etten is a local Realtor with Keller Williams Colorado West Realty. He is also founder and organizer of the Real Estate Investors Network of Western Colorado (www.REIN-WesCO.org). For information about buying or selling a home, investing in real estate or joining REIN, contact Doug at 970-433-4312 or DougVE@kw.com.


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The Post Independent Updated Dec 27, 2012 12:51PM Published Dec 27, 2012 12:48PM Copyright 2012 The Post Independent. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.