(Originally Published August 26th, 2010)

In Northern Colorado, 1 in 20 homes are in foreclosure.  Lending is tight and lending regulations don’t seem to be loosening up any time soon.  That being said, with 30 year fixed rates below 4.5%, an abundance of inventory, and depressed home prices, I believe now is one of the greatest times in recent history to purchase real estate, that is, if you can qualify yourself to buy a home in Northern Colorado first.

Take a Look at Your Financial Picture

Dollar SignTo get started, lenders are going to expect your finances situation to be in order.  Most lenders in Fort Collins or Loveland are satisfied with a down payment of 3.5-5%  for starters, but a down payment isn’t the only hoop you’ll have to jump through to purchase a home.  Lenders will focus on your ability to pay your monthly mortgage along with the associated taxes, insurance, and HOA costs.  A good rule of thumb is that your monthly home expenses should be no more than 25% of your total household income.  For example, if your family brings in $4000 per month, the costs associated with your home should be no more than $1000 per month.  If you’re qualifying for a home in Fort Collins, Loveland or Windsor, this will get you a reasonable entry level home.

How ‘Stable’ Are You?

These days, life can be complicated.  Getting into a home at the wrong time in your life could be quite a disappointment.  Job security is the main concern for most people in Northern Colorado, simply because if they lose their income, they can lose everything.  If you feel you are stable in your job, it may be best to set aside an emergency fund, just in case your employer isn’t as comfortable with you.  Fort Collins, Loveland and most of Northern Colorado have a stable, diverse economy, so finding and keeping a job may not be your biggest worry.  Family responsibilities are another major concern.  Be certain that when you’re planning on buying your home in Northern Colorado, that your family can still expect you to fulfill your normal obligations.  Buying a brand new home and commuting an extra hour per day could really put a strain on your relationships.

Buying Outweighs Renting

OLYMPUS DIGITAL CAMERAAffordability has never been better in Northern Colorado, and with rising rents, buying a home has never made more sense.  With the right discipline and planning, home ownership is substantially more beneficial than renting.  Building equity, and making your house a home will always be beneficial in the long run.  Be sure to look within to determine exactly what you can afford.  Chances are you’ll be very happy with your decision to buy, especially in Fort Collins, Loveland or Windsor. With a very small time investment and the right Realtor, you can make your dreams of home ownership a reality.

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