ColoradoHomeowner FALL 2018 - ISSUE 65
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WHO’S WHO IN
NOCO REAL ESTATE HOW THE AFFLUENT MANAGE HOME EQUITY
HEALTH & WEALTH
7 SUCCESS HABITS
OF MILLIONAIRES
THE LIFE INSURANCE SOLUTION
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HOW THE AFFLUENT MANAGE
HOME EQUITY
SHOPPING MORTGAGES?
THE INSIDE SCOOP ON THE RIGHT QUESTIONS TO ASK
HEALTH & WEALTH 7 HABITS OF MILLIONAIRES
INTERIOR DESIGN TRENDS & TIPS
HOW THE AFFLUENT MANAGE
HOME EQUITY
HEALTH & WEALTH
SHOPPING MORTGAGES?
THE INSIDE SCOOP ON THE RIGHT QUESTIONS TO ASK
7 HABITS OF MILLIONAIRES
INTERIOR DESIGN TRENDS & TIPS
HOW THE AFFLUENT MANAGE
HOME EQUITY THE LIFE INSURANCE
SOLUTION
SHOPPING MORTGAGES?
ASK THE RIGHT QUESTIONS
NEW HOME MARKET UPDATE
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d a n c i n g p i n e s d i s t i l l e r y. co m
How the Affluent Manage Home Equity to Safely and Conservatively Build Wealth
Money, Ric tells the story of two brothers,
More than half the nation’s banks failed
If you had enough money to pay off your mortgage right now, would you? Many people would. In fact, the ‘American Dream’ is to own your own home, and to own it outright, with no mortgage. If the American Dream is so wonderful, how can we explain the fact that thousands of financially successful people, who have more than enough money to pay off their mortgage, refuse to do so. The answer? Most of what we believe about mortgages which we The answer?and Mosthome of whatequity, we believe about mortgages and home equity, learned from our parents and grandparents, which we learned from our parents is wrong. They taught us to make a and big down grandparents, They mortgage, taught us and payment, get isa wrong. fixed rate to make a big down payment, get a fixed make extra principle payments in order to pay rate mortgage, and make extra principle off your loan as early as you can. Mortgages, payments in order to pay off your loan as they arecan. a necessary evilthey at best. earlysaid, as you Mortgages, said, are a necessary evil at best.
The problem with this rationale is it has become outdated. Therationale rules ofismoney The problem with this it has have become outdated. Thegrandparents, rules of moneywe will changed. Unlike our have changed. our job grandparents, no longer have Unlike the same for 30 years. In we will no longer have the same job for many cases people will switch careers five 30 years. In many cases people will switch orcareers six times. Also, unlike our grandparents, five or six times. Also, unlike our we can no longer on ourdepend company’s grandparents, we depend can no longer pension plan for a secure retirement. on our company’s pension plan for a A recent secure survey retirement. A recent Gallup showed that Gallup 75% ofsurvey workers showed that 75% of workers want to retire want to retire before the age of 60, yet only before thethey age can. of 60, yet only 25% think 25% think they can.
Unlike our grandparents, we will no longer Unlike our grandparents, we will no live in the same home for 30 years. Statistics longer live in the same home for 30 show that the average homeowner lives in years. Statistics show that the average their home for only sevenhome years. homeowner lives in their forAnd onlyunlike our grandparents, we will no longer keep the seven years. And unlike our grandparents, we will no longerforkeep the same mortgage same mortgage 30 years. According to the for 30 years. According to the Federal Federal National Mortgage Association, or National Mortgage Association, or Fannie Fannie Mae, the average American mortgage Mae, the average American mortgage lasts 4.2 years. People are refinancing their lasts 4.2 years. People are refinancing homes everyevery 4.2 4.2 years their homes yearstotoimprove improve their interest rate, restructure their debt, remodel their interest rate, restructure their debt, remodel their home, or tomoney pull out their home, or to pull out formoney investing, for investing, or other Given expenses. education or education other expenses. these Given these statistics, it’s difficult to statistics, it’s difficult to understand why understand why so many Americans so many Americans continue to pay a high continue to pay a high interest rate interest rate premium for a 30-year fixed rate premium mortgage, when they are likely to only use
the first 4.2 years of the mortgage. We can financial planning goal, and in fact how you only conclude theyrate aremortgage, operatingwhen on outdated ultimate handle issuesplanning of homegoal, ownership financial and in may well for a 30-year fixed how you handle issues of home they are likelyfrom to only use thegenerations first 4.2 knowledge previous when factdetermine whether you achieve financial may well determine whether years the mortgage. can than only the 30 year ownership thereofwere few optionsWe other success.” you achieve financial success.” conclude they are operating on outdated fixed mortgage. Wealthy Americans, those knowledge from previous generations with the ability to pay off their mortgage but when there were few options other than Why people fear mortgages, refuse to do understand how to make Why people fear mortgages, the 30 year fixedso, mortgage. Wealthy and whyyou youshouldn’t shouldn’t and why their mortgage for them. Americans, those work with the ability to pay off their mortgage but refuse to do so, In order to discover how our parents order to discover how our parents and They go against manytheir of mortgage the beliefs of andIngrandparents understand how to make got the idea that a grandparents got the idea that a mortgage traditional work for them.thinking. They put very little mortgage was a necessary evil at best, a necessary evil at best, we must go back money down, they keep their mortgage we was must go back in time to the Great in time toInthe Depression. They go against many the beliefs of choose Depression. theGreat 1920’s a commonIn the 1920’s balance as high as ofpossible, they traditional thinking. They put very little a common clause in loan gave banks adjustable rate interest-only mortgages, clause in loan agreements gaveagreements money down, they keep their mortgage right tothe demand repaymentfull of repayment right full to demand and most importantly they integrate their thebanks balance as high as possible, they choose theof loan at any time. Since this was loan at any time. Since like this was like mortgagerate intointerest-only their overallmortgages, financial plan to askingthe adjustable for the moon and the stars, no one asking for the moon and the stars, no one continually increasethey theirintegrate wealth. This and most importantly their is how worried about it. When the stock market worried about it. When the stock market mortgage intoricher. their overall financial plan the rich get crashed on October 29, 1929 millions of crashed October 29,money, 1929much millions of to continually increase their wealth. This is investors loston huge sums of Thethe game is the same, but while most of itinvestors how richboard get richer. lost huge sums of money, on margin. Back then, you could buy much Americans are playing checkers, the affluent $10ofof itstock for a $1. Since value on margin. Back the then, youofcould buy The board is theThe same, but while stocks dropped, wanted aregame playing chess. good news is the the$10 of stock for afew $1.investors Since the value of the most Americans are playing checkers, the to sell, so they had to go to the bank strategies used by the wealthy work for the stocks dropped, few investors wanted to sell, affluent are playing chess. The good news and take out cash to cover their margin rest of America as well. Any home-owner can so they had to go to the bank and take out is the strategies used by the wealthy work call. It didn’t take long for the banks to implement the strategies of the wealthy to tocash coverand their margin It didn’t take for the rest of America as well. Any homeruncash out of start callingcall. loans increase their net worth. owner can implement the strategies of the theAmericans banks to who run were out of cash and duelong fromfor good wealthy to increase their net worth. faithfully making their mortgage start calling loans due from payments good Americans RicEdelman, Edelman,one oneofofthe thetop topfinancial financial planners every month. However, there wasn’t any Ric who were faithfully making their mortgage in the country and aand New York York Times Best demand to buy these homes, so prices planners in the country a New payments every month. However, there Times Best Selling author, summarizes in The continued to drop. To cover the margin Selling author, summarizes in this book wasn’t any demand to buy these homes, so this book The Truth About Truth About Money, “TooMoney, often,“Too people buy calls, brokers were forced to sell stocks prices continued to drop. To cover the margin often, people buy homes in a vacuum, homes in a vacuum, without considering how and once again there wasn’t a market calls, brokers were forced to sell stocks and without considering how that purchase is that purchase is going to affect other aspects for stocks so the prices kept dropping. going to affect other aspects of their lives. once again thereDepression wasn’t a market for stocks Ultimately, the Great saw the of their lives. This can beand a big mistake, and stock market fall more than 75% from its This can be a big mistake, therefore so the prices kept dropping. Ultimately, the therefore you mustthat recognize owning a 1929 highs. you must recognize owning athat home Great Depression saw the stock market fall holds important implications for the homevery holds very important implications for more than 75% from its 1929 highs. rest your plan. Although a theofrest of financial your financial plan. Although a fine goal, owning a home is not the
fine goal, owning a home is not the ultimate
More than half the nation’s banks failed and millions of homeowners, unable to raise the
cashand they needed to payoff their loans,tolost millions of homeowners, unable theirraise homes. Out of thisneeded the American Mantra the cash they to payoff loans, lost own their homes. Out of this wastheir born: Always your home outright. the American Mantra was born: Always Never carry a mortgage. own your home outright. Never carry a
Themortgage. reasoning behind America’s new mantra The reasoning behind ifAmerica’s new fell was really quite simple: the economy mantra was really quite simple: if the to pieces, at least you still had your home economy fell to pieces, at least you still andhad the your bankhome couldn’t take it away from you. and the bank couldn’t take Maybe you couldn’t put food oncouldn’t the table it away from you. Maybe you putor payfood youronbills, but your was but secure. the table or payhome your bills, your secure. Since Great Since thehome Greatwas Depression lawsthe have been Depression have been introduced introduced thatlaws make it illegal for banks to illegal for banks to call your call that yourmake loanitdue. The bank can no longer loan due. The bank can no longer call you call up youand upsay, and“We’re say, “We’re running a little running a little short on short on cash and need you to pay your cash and need you to pay off youroff loan in loanthe in next the next thirtythirty days.”days.” Additionally, the Fed is now quick to
Additionally, the into Fed the is now quick to infuse infuse money system if there is money into the system if there is a run a run on the banks, as we saw in 1987 on Y2K. the in FDIC wasand created the and banks, asAlso, we saw 1987 Y2K. to Also, insure banks. Still, it’s no wonder the fear the FDIC was created to insure banks. Still, of losing their home became instilled in it’s no wonder the fear of losing their home the hearts and minds of the American became instilled in the hearts and minds people, and they quickly grew to fear of the American and and they60’s quickly their mortgage.people, In the 1950’s grewfamilies to fearwould theirthrow mortgage. In the 1950’s mortgage burning to celebrate paying off their andparties 60’s families would throw mortgage home.parties And so, this fearoff of their burning tobecause celebrateofpaying their mortgage, for nearly 75 years most home. And so, because of this fear of their people have overlooked the opportunities mortgage, for nearly 75 years most people their mortgage provides to build financial havesecurity overlooked the opportunities their mortgage provides to build financial security.
Why people hate their mortgage andtheir whymortgage you Why people hate andshouldn’t why you shouldn’t Many people hate their mortgage because
Many people hate the their because they know over lifemortgage of a 30 year loan, theythey know lifeinofinterest a 30 than year the loan, will over spendthe more cost them in the place.than To save theyhouse will spend more in first interest the money it becomes very tempting to make house cost them in the first place. To save a bigger down payment, or make extra money it becomes very tempting to make principal payments. Unfortunately, saving a bigger down payment, or make extra money is not the same as making money. principal Or, put payments. another way,Unfortunately, paying off debtsaving is money is not the as same as makingassets. money.ByOr, not the same accumulating mortgage put tackling anotherthe way, paying pay-off off debtfirst, is and not the the same as accumulating assets. By tackling the mortgage pay-off first, and the savings goal second, many fail to consider the important role a mortgage plays in our savings effort.
Common Home Equity Misconceptions Many Americans believe the following statements to be true, but in reality they are myths, or misconceptions:
Your home equity is a prudent investment.
FALSE Extra principal payments on your mortgage saves you money.
FALSE Mortgage interest should be eliminated as soon as possible.
FALSE Substantial equity in your home enhances your net worth.
FALSE Home Equity has a rate of return.
FALSE savings goal many failistoaconsider Every dollar wesecond, give the bank dollar we the important role apaying mortgage plays in our did not invest. While off the mortgage savings effort. Every dollar we give the saves us interest, it denies us the opportunity bank is a dollar we did not invest. While to earn interest with that money. paying off the mortgage saves us interest, it denies us the opportunity to earn interest with that money.
A tale of two brothers
Ric Edelman has educated his clients for A tale of two brothers years on the benefits of integrating their mortgage intohas their overallhisfinancial Ric Edelman educated clients plan. Inforhisyears book, The New Rules of Money, Ric on the benefits of integrating their overall financial tells themortgage story of into two their brothers, each of whom plan. In his book, The New Rules of secures a mortgage to buy a $200,000 home. Each brother earns $70,000 a year and has $40,000 in savings. The first brother, Brother A, believes in the old way of paying
off a mortgage, which aismortgage as soon astopossible. each of whom secures Brother A bites the bulletEach and brother secures a fifteenbuy a $200,000 home. earnsmortgage $70,000 aatyear and APR has $40,000 year 6.38% and shells out in savings. The first brother, Brother A, down all $40,000 of his savings as a 20% believes inleaving the old him way of paying off a payment, zero dollars to invest. mortgage, which is as soon as possible. This leaves him with a monthly payment of Brother A bites the bullet and secures a $1,383. Since he hasat 6.38% a combined fifteen-year mortgage APR andfederal and income taxofrate 32%, as he is left shellsstate out all $40,000 his of savings a 20%an down payment, leaving zero cost with average monthly nethim after-tax dollars to invest. with a of $1,227. Also, This in anleaves efforthim to eliminate his monthly payment of $1,383. Since he has mortgage sooner, Brother A sends an extra a combined federal and state income tax $100 to his lender every month. Brother rate of 32%, he is left with an average B, in contrast, subscribes the new way of monthly net after-tax cost ofto$1,227. Also, mortgage planning, choosing instead to in an effort to eliminate his mortgage carry a big, long-term He secures sooner, Brother A sendsmortgage. an extra $100 to his lender every month. a 30-year, interest-only loan at 7.42% APR. He outlays a small 5% down payment of Brother B, in contrast, subscribes $10,000 and invests the remaining $30,000 to the new way of mortgage planning, in a safe, moneymaking account. His choosing instead to carry a side big, long-term monthly is $1,175, 100% of which mortgage.payment He secures a 30-year, interestis taxloan deductible 15 ayears, and only at 7.42% over APR.the He first outlays small over 5% down payment $10,000 and him 64% the life of theof loan, leaving invests the remaining $30,000 in a safe, a monthly net after-tax cost of $799. Every moneymaking side account. His monthly month he adds $100 to his investments (the payment is $1,175, 100% of which is tax same $100 Brother A sent to his lender), plus deductible over the first 15 years, and 64% the he’s from his lower over$428 the life ofsaved the loan, leaving him mortgage a payment. His investment account earns an monthly net after-tax cost of $799. Every month $100 to his investments 8% rateheofadds return. (the same $100 Brother A sent to his
Which brother madehe’s thesaved rightfrom decision? lender), plus the $428 his lower mortgage payment. His investment The answer can be found by looking into account earns anjust 8% rate return. the future. After five of years Brother A has received $14,216 in tax savings, however he Which brother made the right decision? made zero dollars in savings and investments. The answer can be found by looking into Brother B,After on the hand, has received the future. justother five years $22,557 savings$14,216 and hisin savings and Brother A in hastax received tax savings, however he made zero dollars in investment account has grown to $83,513. savings and investments. Brother B, on thelose Now, what if both brothers suddenly other hand, has received $22,557 in tax their jobs? The story here turns rather bleak savings and his savings and investment Brother A. Without any money in savings, for account has grown to $83,513. Now, what he hasbrothers no way tosuddenly get through the crisis. if both lose their jobs? Even though he has $74,320 of equity in his The story here turns rather bleak for Brotherhe A. can’t Without money in savings, home, getany a loan because he doesn’t he has no way to get through the crisis. have a job. With no job and no savings, he Even though can’t make his monthly payments and has no choice but to sell his home in order to avoid foreclosure. Unfortunately, at this point it’s a fire sale so he must sell at a discount, and
3
A Tale of Two Brothers Adapted from the book, The New Rules of Money
Our story begins with two brothers, each earning $70,000 a year. They each have $40,000 in savings and both are buying $200,0000 homes.
Brother “A” believes in “The Old Way” – paying off the mortgage as soon as possible
Brother “B” believes in “The New Way” –carrying a big, long mortgage
15-year mortgage at 6.38% APR
30-year mortgage at 7.42% APR
$40,000 Big Down Payment
$10,000 Big Down Payment
$0 left to invest
$30,000 left to invest
$1,383 Monthly Payment
$1,175 Monthly Payment
(56% is tax deductible first year/33% average)
(100% is tax deductible first 15 yeas/64% average)
$1,227 Monthly Net After-Tax Cost
$799 Monthly Net After-Tax Cost
Sends $100 monthly to lender in effort to eliminate mortgage sooner
Adds $100 monthly to investments, plus $428 saved from lower mortgage payment where account earns 8% rate of return
Results after 5 Years Received $14,216 in tax savings
Received $22,557 in tax savings
has $0 in savings and investments
has $83,513 in savings and investments
What if both brothers suddenly lost their jobs? Has no savings to get him through crisis
Has $83,513, in savings to tide him over
Can’t get a loan – even though he has $74,320 more in equity than his brother – because he has no job
Doesn’t need a loan
Must sell his home or face foreclosure because he can’t make payments
Can easily make his mortgage payments even if he’s unemployed for years
At this point – it’s a fire sale – he must sell at a discount and pay real estate commissions (6-7 %)
has no reason to panic since he’s still in control – remember... cash is KING!
then pay real estate commissions. Brother B, while not particularly happy at the prospects of searching for a new job, is not worried becauseofheequity has $83,513 in savings to he has $74,320 in his home, tide him get over.a loan He doesn’t need a loan and can he can’t because he doesn’t easily his monthly payments, even if he have amake job. With no job and no savings, can’t make his payments and isheunemployed formonthly years. He has no reason to has no choice but to sell his home in panic, as he is still in control. Remember… order to avoid foreclosure. Unfortunately, at this is point it’s a fire sale so he must sell Cash King! at a discount, and then pay real estate commissions. Now, let’s say neither brother lost his
job. We’ll check in on them after fifteen years have Brother B, whilethey not particularly passed since purchasedhappy their athomes the prospects of searching for a new job, and evaluate the results of their financing is not worried because he has $83,513 in strategies. Brother A He hasdoesn’t now need received savings to tide him over. $25,080 taxeasily savings, $30,421 in a loan andincan makehehishas monthly payments, even if he savings and investments (once his home is unemployed years.saving He hasthe noequivalent was paid off hefor started reason to panic, as he is stilleach in control. of his mortgage payment month), and Remember… owns his home outright. Not too bad, right? Cash is King!
Now let’s check on his Brother. Brother B Now, let’s say neither brother lost his job. has received $67,670 in tax savings and has We’ll check in on them after fifteen years $282,019 in since savings investments. have passed theyand purchased their If he chooses to,evaluate he can the payresults off the remaining homes and of their financing strategies. A has now mortgage balance ofBrother $190,000 and still have received left $25,080 in savings, tax savings, has $92,019 over in freehe and clear. $30,421 in savings and investments (once
Results After 15 Years Received $25,080 in tax savings
Received $67,670 in tax savings
Has $30,421 in savings and investments
Has $282,019 in savings and investments
Owns home outright
Remaining mortgage balance is $190,000 – and he has enough savings to pay it off and still have $92,019 left over, free and clear
Results After 30 Years Received $25,080 in tax savings
Received $107,826 in tax savings
Has $613,858 in savings and investments
Has $1,115,425 in savings and investments
Owns home outright
Owns home outright – so starts fresh and enjoys the same benefits once again
his homelet’s was assume paid off he started saving Finally, that rather than pay the equivalent of his mortgage payment off his mortgage at fifteen years, Brother B each month), and owns his home outright. decides to ride out the whole thirty years of the Not too bad, right? loan’s life. While Brother A has still received only inon taxhissavings, savings Now $25,080 let’s check Brother.his Brother B and investments have grown to $613,858, has received $67,670 in tax savings and and hasstill $282,019 investments. he owns inhissavings homeand outright. Brother B, If he chooses to, he has can received pay off the on the other hand, a whopping remaining mortgage balancehas of $190,000 $107,826 in tax savings, accumulated and still have $92,019 left over in savings, an incredible $1,115,425 in savings and free and clear. investments, and also owns his home outright. Heassume can start Finally, let’s thatover ratherfresh than and pay enjoy off his mortgage fifteenagain. years,Unfortunately, Brother the same benefitsat once B decides to ride out the whole thirtythe same the majority of Americans follow yearsas of Brother the loan’s A they path A,life. as While it’s theBrother only path has still received only $25,080 in tax know. Once the path of Brother B is revealed savings, his savings and investments to them, a paradigm shifting epiphany often have grown to $613,858, and he still occurs as they Brother B’sB,path enables owns his homerealize outright. Brother on the homeowners to received pay their ahomes off sooner (if other hand, has whopping they choose to), while significantly increasing
Are you still doing this? “Here is an extra $100 principal payment Mr. Banker. Don’t pay me any interest on it. If I need it back, I’ll pay you fees, borrow it back on your terms, and prove to you that I qualify.”
Money you give the bank is money you’ll never see again unless you refinance or sell.
Many Americans believe the best way to
Certified Financial Planners) contained
$107,826 in tax savings, has accumulated their net worth and maintaining the added year loan and a 30-year loan, as well as the tax 4-5%, the chances are pretty good that you the first academic study undertaken on pay off a home early is to pay extra principal an incredible $1,115,425 in savings and into a safe side investment account can the benefits of liquidity and safety the entire way. savings earn 5% on your money. Interest rates question of 15-year versus 30-year on your mortgage. Similarly, many finance investments, and also owns his home earning a conservative rate of return, you will are relative. In the 1980’s, moneythe was30-year costingloan mortgages. They concluded professors think a 15-year loan saves you outright. He can start over fresh and enjoy have enough to pay your home off in 13½ 15%, but individuals could still earn 15% on is better. Based on the same logic, wouldn’t money by reducing the interest you pay. the same benefits once again.home Unfortunately, Successfully managing years (or in 15 yearsAndrew with $25,000 to spare!). their money. Due to the tax deductibility of However, Doug points out in his the majority of Americans follow the same equity increase liquidity, an interest-only loan be better than an book, one Missed Fortune,Fortune that thistalks thinking is in Missed about path asto Brother A, as it’s the only path they Chapter mortgage interest and compounding returns, If mortgage money If you do the made math, you find if youof youamortizing know. Once of Brother safety, rate the of path return, and B is revealed theflawed. $25,000 mistake by millions can borrowloan? at a higher rate and investcost it atyou 4-5%, the chances are pretty good that you set asidewho thechoose monthly payment difference to them, a paradigm shifting epiphany often Americans the fifteen-year loan. a lower rate and still make a significant profit. tax deductions occurs as they realize Brother B’s path homeowners to pay their homes In enables 2003, Doug Andrew, a top financial planneroff sooner theythe choose while significantly from Utah,(if was first to), to clearly articulate increasing their net worth and maintaining the strategy the wealthy have been using the added benefits of liquidity and safety the forentire decades in his book, Missed Fortune. The way.
book is based on the concepts of successfully managing home equity to increase liquidity, Successfully managing home safety, rate of return, and tax deductions. equity toreaders increase Doug educates to viewliquidity, their mortgage ratethrough of return, and andsafety, home equity a different lens, the same used by the affluent. He shows taxlens deductions how relatively minor changes in home equity In 2003, Doug Andrew, a top financial perception and positioning can produce planner from Utah, was the first to clearly monumental long-term effects in financial articulate the strategy the wealthy have security. been using for decades in his book, Missed
Fortune. The book is based on the concepts Many Americans believe the best way to of successfully managing home equity to payincrease off a home early is to pay extra principal liquidity, safety, rate of return, and ontax your mortgage. Similarly, many finance deductions. Doug educates readers professors thinkmortgage a 15-year to view their andloan homesaves equityyou money by a reducing the the interest through different lens, sameyou lens pay. used However, Doug Andrew pointshow outrelatively in his book, by the affluent. He shows minorFortune, changesthat in home equity perception Missed this thinking is flawed. If and positioning can produce monumental you do the math, you find if you set aside the long-term effectsdifference in financialbetween security. a 15monthly payment
between a 15-year loan and a 30-year loan,
as well as the tax savings a safe side Cram Investment Groupintoteaches an investmentseminar account for earning conservative educational the apublic based rate of return, you will have enough to largely on the Missed Fortune concepts.pay In home we off inbreak 13½ years in 15 years theyour seminar, down(orthe four key with $25,000 to spare!). Chapter one in benefits of integrating your mortgage into Missed Fortune talks about the $25,000 your financial plan (increased liquidity, safety, mistake made by millions of Americans who ratechoose of return, tax deductions) the and fifteen-year loan. in order to look at each one in more detail
can earn 5% on your money. Interest rates are relative. In the 1980’s, money was costing 15%, but individuals could still earn 15% on their money. Due to the tax deductibility of mortgage interest and compounding returns, can cash borrow at a higher and invest By you having available ftor rate emergencies at a lower rate and still make a significant andit investment opportunities, most homeprofit.
Large equity in your home can be a big disadvantage
owners are better off than if their equity is tied up in their residence. Large, idle equity, also Large equity your home called ‘having all yourineggs in one basket,’ Cram Investment Group teaches an Oureducational goal is to help clients conserve their home can be a big disadvantage can be risky if the homeowner suddenly seminar for the public based equity, notonconsume it. Fortune We are concepts. one of theIn needs cash. While employed and in excellent largely the Missed By having cash available ftor emergencies fewthe financial planning firms who health, borrowing on a home is easy, but most seminar, we break down theencourage four key and investment opportunities, most homeclients to secure debt in order become debt benefits of integrating yourtomortgage into people, especially owners are betterretirees, off than if unexpectedly their equity financial plan (increased liquidity, safety, need freeyour sooner. when theyresidence. are sick, unemployed is cash tied up in their Large, idle or rate of return, and tax deductions) in order to haveequity, insufficient income. Obtaining home also called ‘having all your aeggs in In look Aprilat 1998, Thein more Journal of Financial each one detail basket,’ be risky if the loanone under thesecan circumstances canhomeowner be either Planning (published by the Institute of suddenly cash. While employed impossible orneeds very expensive. Our goalFinancial is to help clients conserve their Certified Planners) contained and in excellent health, borrowing on a not consume it. We are one thehome first equity, academic study undertaken on Howhome manyisofeasy, us feel go toespecially the bank butwhen most we people, of the few financial planning firms who the question of 15-year versus 30-year we almost retirees,need unexpectedly need cash when to prove we don’t need thethey encourage clients to secure in order are sick, unemployed or have insufficient mortgages. They concluded thedebt 30-year loanto money before they’ll loan it to us? The bank become debt free sooner. income. Obtaining a home loan under these is better. Based on the same logic, wouldn’t wants to know we have the ability to repay can be how eithera conversation impossible or an Ininterest-only loan be better than an the circumstances loan. You can imagine April 1998, The Journal of Financial very expensive. amortizing If mortgage Planningloan? (published by the money Institutecost of you might go with your banker: “I brought up
“It’s better to have access to the equity or value of your home and not need it, than to need it and not be able to get at it.”
your loan application up to the board this There are actually three primary reasons:
How many of us feel when we go to the morning and I explained to them you’re going bank we almost need to prove we don’t through some hard financial times, you’re need the money before they’ll loan it to us? unemployed, your credit is not so good and The bank wants to know we have the ability maybe lendcan youimagine some cash to repaythey the could loan. You how to a get through thesemight rough times. Their response conversation go with your banker: “I was... ‘Fatupchance!’ brought your loan application up to the board this morning and I explained to them What many is that even you’re goingpeople throughdon’t somerealize hard financial if they’ve consistently been making double times, you’re unemployed, your credit is not so good and maybe they could lend you mortgage payments for five years in a row, the some cashhas to get rough times. bank still no through leniency.these If suddenly they Their response was... ‘Fat chance!’ experience a financial setback, the bank will
not care. They can go to the bank and plead,
What many people don’t realize is that even “I never thought in a million years this would if they’ve consistently been making double happen to me, but it did. I’ve been paying my mortgage payments for five years in a row, mortgage in has advance for years, how about if the bank still no leniency. If suddenly I justexperience coast on my mortgage payments for a they a financial setback, the bank fewnot months?” Theycan get go thetosame answer every will care. They the bank and plead, never thought in ajust million time... “I‘Fat chance!’ Banks don’tyears workthis that would happen to me, but it did. I’ve been way. Regardless of how much you’ve paid your paying my down mortgage in advance for payments years, mortgage or how many extra how about if I just coast on my mortgage you’ve made, next month’s payment is still payments for a few months?” They get the due in its entirety no matter what. same answer every time... ‘Fat chance!’ Banks just don’t work that way. Regardless of how much you’ve paid your mortgage down or how many extra payments you’ve made, next month’s payment is still due in its entirety no matter what.
mortgage payment, or have an additional financial times, would your rather have $25,000 of equity trapped in your home? $25,000 of cash to help you make your Almost every person who has ever lost their mortgage payment, or have an additional home to foreclosure would have been better $25,000 of equity trapped in your home? off if they hadperson their who equity from Almost every hasseparated ever lost their 1. Liquidity home in a liquid,would safe, conservative side home to foreclosure have been better These three elements are also commonly their 2. Safety fund that could be used to make mortgage off if they had their equity separated from used asofthe test of a prudent investment. 3. Rate return their home in a liquid, conservative side during their safe, time of need. When evaluating a potential investment, payments fund that could be used to make mortgage These three elements experienced investors are will also ask commonly the following The importance of liquidity became all too payments during their time of need. used as the test of a prudent investment. three questions: clear when the stock market crashed in cash position. Why in the world would you want to have the1.equity removed from your Liquidity home? There are 2. actually Safetythree primary reasons: 3. Rate of return
When evaluating a potential investment, experienced1. investors will ask the following How liquid is it? three questions: (Can I get my money back when I want it?)
2. How 1. How liquid issafe it? is it?
(Can I get my back when I want it?) (Is itmoney guaranteed or insured?)
3. Whatsafe rate ofisreturn 2. How it? can I expect? (Is it guaranteed or insured?)
Home equity fails all three tests of a prudent investment. Let’s examine each can of these core 3. What rate of return elements in more detail to better understand I expect? why home equity fails the tests of a prudent Home equity and, fails allmore three tests of a prudent investment, importantly, why investment. Let’s examinebyeach of these core home-owners benefit separating the elements in more detail to better understand equity from their home. why home equity fails the tests of a prudent investment, and, more importantly, why home-owners benefit by separating the equity from their home.
The importance became too October of 1987.of Ifliquidity someone had alladvised clear when the stock market crashed in you to sell your stocks and convert to cash, October of 1987. If someone had advised they would have been a hero. Or, if you had you to sell your stocks and convert to cash, enough liquidity you could have weathered they would have been a hero. Or, if you had the storm. Those with other liquid assets were enough liquidity you could have weathered able to remain invested. Theyliquid wereassets rewarded the storm. Those with other aswere theable market rebounded to remain invested.and Theyrecovered were fully withinas90the days. However, those and without rewarded market rebounded recovered fully withinto90 However, liquidity were forced selldays. while the market those without liquidity were forcedsignificant to sell was down, causing them to accept while the market was down, causing them losses. In Missed Fortune, Doug Andrew tells to accept significant losses. In Missed the story of a young couple who learned what Fortune, Doug Andrew tells the story of a he calls “The $150,000 Lesson on Liquidity”. young couple who learned what he calls In“The 1978 this couple built a beautifulIn home $150,000 Lesson on Liquidity”. that be featured Better home Homesthat and 1978would this couple built a in beautiful Gardens. couple’s home appreciated would be The featured in Better Homes and The by couple’s inGardens. value, and, 1982,home it wasappreciated appraised for in value, by 1982,They it was appraised for just underand, $300,000. had accumulated just under $300,000. They had accumulated a significant amount of equity, not because a significant amount of equity, not because they had been making extra payments on they had been making extra payments on the property, but because market conditions the property, but because market conditions improved improvedover overthat thatfour-year four-yearperiod. period.
Why separate equity from your home?
Separating equity to increase liquidity
In the book, Missed Fortune, Doug Andrew suggests people strongly Why from equity considerseparate separatingequity as much your as theyhome? possibly can from their house, and place it overMissed in a cash position. in the In the book, Fortune, DougWhy Andrew world would youstrongly want to have the equity suggests people consider separating as much equity as they possibly removed from your home?
What is the biggest secret Separating equity toin real estate? Your mortgageliquidity is a loan against your income, increase not a loan against the value of your house. What is the biggest secret in real estate? Your Without an income, in many cases you cannot mortgage is a loan against your income, not a get a loan. If you suddenly experienced loan against the value of your house. Without This couple thought they had the world by difficult financial your get rather an income, in manytimes, caseswould you cannot a This couple thought they had the world tail. They had a home valued at $300,000 have of cashexperienced to help you make loan. $25,000 If you suddenly difficultyour the by the tail. They had a home valued at
can from their house, and place it over in a
during which wasbalance forced to who got stucktime withthe the lender deficiency of $30,000 on mortgage their creditand report? original pay the first alsoThe accrued an owners, of$30,000 course! of interest and penalties. additional By the time the home finally sold, less the They hadhad thethe misconception that thethe equity in This couple not only had a foreclosure They misconception that $30,000 in accrued indebtedness, guess equity their home had of a rate of return appear on their credit report for seven years, theirinhome had a rate return when, when, in fact,init who got stuck with the deficiency balance of fact,was it was a number a sheet of paper. the report also showed a deficiency balance justjust a number on aonsheet of paper. $30,000 on theironcredit report? owing $30,000 a home they The had original lost owners, of course! nearly one year Then, a series of unexpected events reduced Then, a series of unexpected events reduced earlier. In a time of financial setback they lost their income to almost nothing for nine months. their income to almost nothing for nine This couple not only had a foreclosure appear of their most valuable assets due to a They couldn’t borrow money to keep their months. They couldn’t borrow money to keep onone their credit for seven years, the lack of liquidity.report If they had separated their mortgage payments current because without their mortgage payments current because report also showed deficiency owing $150,000 in homeaequity and balance repositioned an income they did not have the ability to without an income they did not have the ability $30,000 on a side homeaccount, they had lostwould nearlyhave one it into a safe they repay. Within six months they had sold two to repay. Within six months they had sold two year easily beenInable to make their mortgage other properties to bring their mortgage out of earlier. a time of financial setback they other properties to bring theirthat mortgage payments and prevented this series delinquency. They soon realized in orderout to lost one of their most valuable assetsofdue to of delinquency. They soon realized that in protect their $150,000 of equity they would have a events. lack of liquidity. If they had separated their At this point in the story, Doug admits the to sell their home. As Murphy’s Lawofwould order to protect their $150,000 equityhave they $150,000 in home equity and repositioned couple was really he and his wife, it, the would have to sell their home. As Murphy’s it young into a safe side account, they would have Sharee. Despite objections from his editor, previously strong real market turned Law would have it,estate the previously strongsoft. real easily able make their mortgage Dougbeen insisted the to story remain in the book estate market turned soft. payments and prevented this series of events. with first and second mortgages owingowing only $300,000 with first and second mortgages only$150,000. $150,000.They Theyhad had“made” “made”$150,000 $150,000ininfour four short years. short years.
Although they reduced their asking price several times – from $295,000 down their to $195,000 they Although they reduced asking –price could not find a buyer. Sadly, they gave up the several times – from $295,000 down to home in foreclosure to the mortgage lender. $195,000 – they could not find a buyer. Sadly, Sometimes sad stories only get sadder. The two they gave up the home in foreclosure to the mortgages on the property were in the amounts mortgageand lender. Sometimes sadThe stories of $125,000 $25,000, respectively. only mortgage get sadder. The two mortgages on the second holder outbid the first one property were in the amounts of $125,000 at the ensuing auction, feeling that, much like theand original owners, itrespectively. was in a goodThe position. $25,000, second Knowing that the house had been appraised mortgage holder outbid the first one at for the $300,000, the obligation owing was like only the ensuingand auction, feeling that, much $150,000, thought ititcould turna around and originalit owners, was in good position. sell the property to cover the investment. It took Knowing that the house had been appraised nine long months to sell, during which time the for $300,000, and the obligation owing lender was forced to pay the first mortgage and only $150,000, it thought turn alsowas accrued an additional $30,000 itofcould interest around and sell the property to cover the and penalties. By the time the home finally sold, It in took nine long months toguess sell, lessinvestment. the $30,000 accrued indebtedness,
because he wanted his readers to know he understands first hand the importance of Atpositioning this pointassets in theinstory, Doug admits the financial instruments couple liquidity was really and ofhisan wife, young that maintain in theheevent Sharee. Despite objections from his access editor, emergency. If Doug and Sharee had Doug insisted storythey remain inhave the book to their home’sthe equity, could used it to weather the his readers to know he because he wanted financial storm they the could get back of understands firstuntilhand importance on their feet. Dougin learned frominstruments his own positioning assets financial experience the importance of maintaining that maintain liquidity in the event of an flexibility in order to ride out market lows emergency. If Doug and Sharee had access and take advantage of market highs. And, tomost theirimportantly, home’s equity, they could useda he learned neverhave to allow it significant to weatheramount the financial storm until theyin of equity to accumulate could get back on their feet. Doug learned his property. Home is not the same cash in theof from hisequity own experience the as importance bank; only cash in the bank is thetosame maintaining flexibility in order ride as out cash in the bank. Being house rich and cash market lows and take advantage of market poor is a dangerous position to be in. It is
highs. And, mostaccess importantly, he learned better to have to the equity or value of yourtohome not need amount it, than toofneed it and never allowand a significant equity not be able to get at it. Keeping home equity to accumulate in his property. safe is really a matter of positioning yourself to act instead of not reactthe to same marketasconditions over Home equity is cash in the which youcash have bank; only inno thecontrol. bank is the same as
cash in the bank. Being house rich and cash Separating equity poor is a dangerous positiontoto be in. It is better to have access to or value of increase safetytheofequity principal your home and not need it, than to need it and The Seattle Times, in an article published notinbeMarch able 2004, to get reported, at it. Keeping home equity “Remember that safehousing is reallyprices a matter of positioning can and do level off.yourself to They act instead of react to market conditions sometimes decline – witness Southern over which you have no control. California just a little more than a decade
ago, when prices took a 20 percent to 30 percent corrective jolt downward.” Real estate equity is no safer than any other investment whose value is determined by an external market over which we personally have no Thecontrol. SeattleIn Times, fact, dueintoan thearticle hiddenpublished “risks of life,” estate equity is not nearly as safe as many in real March 2004, reported, “Remember that other conservative housing prices can andinvestments do level off.and assets. A home that is either mortgaged to the hilt They sometimes decline – witness Southern or owned totally free and clear provides the greatest safety for the homeowner. California just a little more than a decade ago,
Separating equity to increase safety of principal
when prices took a 20 percent to 30 percent corrective jolt downward.” Real estate equity is no safer than any other investment whose value is determined by an external market “Home equity over which we personally have is nonot control. In fact,the due same to the hidden “risks of in life,”the real as cash estate bank. equity is not nearly as safeinasthe many Only cash other conservative investments and assets. bank is the same as A home that is either mortgaged to the hilt cashfree inand theclearbank.” or owned totally provides the greatest safety for the homeowner.
the Enron Corporation collapsed a few years ago, and thousands lost their jobs and homes, again in Houston, Texas. What would happen in the Seattle area if Microsoft or Boeing had major lay-offs? Money you give the bank is money you’ll never see again unless you Americans typically believe home equity is refinance or sell. When the people in Houston a very safe investment. In fact, according to pleaded, “Mr. Banker, I’ve been making extra a recent study, 67% of Americans have more mortgage payments for years. I’m well ahead of their net worth in home equity than in all of schedule. Will let you let me coast for a other investments combined. However, if 100 while?” The bank replied, “Fat Chance!” financial planners looked at a client portfolio that was 67% weighted in a single investment, 99 out of 100 of them would immediately To reduce the risk of foreclosure recommend the client diversify to reduce during unforeseen set-backs, their risk and increase safety of principal. keep your mortgage balance as Holding large amounts of home equity puts the homeowner at unnecessary risk. This risk high as possible could be greatly reduced by diversifying their Is your home really safe? Unfortunately, home equity into other investments. many home buyers have the misconception An example of the necessity of keeping your that paying down their mortgage quickly home’s equity safely separated from your is the best method of reducing the risk property can be can be found in Houston, of foreclosure on their homes. However, Texas. When oil prices fell to all time lows in reality, the exact opposite is true. As in the early 1980’s the city of Houston was homeowners pay down their mortgage, hit hard. Thousands of workers were laid off they are unknowingly transferring the risk and ultimately forced to sell their homes. from the bank to themselves. When the With a glut of homes on the market, housing mortgage balance is high, the bank carries prices plummeted. Unfortunately, there the most risk. When the mortgage balance were far too many sellers and far too few is low, the homeowner bears the risk. With a buyers. Homeowners were unable to sell and low mortgage balance the bank is in a great unable to make their mortgage payments. position, as they stand to make a nice profit As a result, 16,000 homes were foreclosed. if the homeowner defaults. In addition to Did these 16,000 families suddenly become assuming unnecessary risk, many people who bad people? No, they just couldn’t make their scrape up every bit of extra money they can to mortgage payments. Just prior to this series apply against principal often find themselves of events many of these people were making with no liquidity. When tough times come, extra principal payments. Unfortunately, they they find themselves scrambling to make could not coast on those extra payments, and their mortgage payments.
“Home equity is not the same as cash in the bank. Only cash in the bank is the same as cash in the bank.”
with so many houses on the market for sale, Assume you’re a mortgage banker looking some people literally had to walk away from at your portfolio, and you have 100 loans their home. that are delinquent. All of the loans are The equity these people had worked so hard for homes valued at $300,000. Some of to build up was lost completely. They learned the loan balances are $150,000 and some the hard way that home equity is fragile, and are $250,000. Suddenly, there is a glut in certainly not as safe as they once thought. the market and the homes are now worth Could this happen today? Just look at when $200,000. Which homes do you as the banker foreclose on FIRST? The ones owing the least
amount of money, of course. After all, as a banker you’d make money taking back those homes, however you’d lose money trying to sell a home for $200,000 that still owed $250,000 on it. Banks have been known to call delinquent homeowners with high mortgage balances and offer assistance, “We understand you are going through some tough times, is there anything we can do to help you? We really want you to be able to keep your home.” The last thing they want to do is take back a home that they will lose money reselling. It’s interesting to note, during the Great Depression, the Hilton chain of hotels was deeply affected by the stock market crash and couldn’t make their loan payments. What saved them from financial ruin? They were so leveraged, in other words they owed so much more on their property than it was worth, that the banks couldn’t afford to bother wasting their time foreclosing on it. The Hiltons understood the value of keeping high mortgage balances thereby keeping the risk on the banks. The Houston homeowners would have been better off if they had removed a large portion of their equity and put it in a safe and liquid side fund, accessible in a time of need. Ask yourself, if you owned a $400,000 home during an earthquake in California (and you didn’t have earthquake insurance), would you rather have your equity trapped in the house or in a liquid, safe side fund? If it were trapped in the home, your equity would be lost along with the house.
our home appreciates, or our mortgage balance is going down, thatTherefore, the equityhome has a the home’s appreciation. rate of return. That’s not true. Home equity equity simply sits idle in the home. It does rate of Home return. values Assume you hasnot NOearn rateany of return. fluctuate have a home worth $100,000 which youthe due to market conditions, not due to own freebalance. and clear. If thethe home appreciates mortgage Since equity in the 5%, you own an asset worth $105,000 at home has no relation to the home’s value, the end of the year. it is in no way responsible for the home’s appreciation. Therefore, home equity simply Now, assume you had separated the sits$100,000 idle in theofhome. It does not earn any rate home equity and placed it in of areturn. Assume you haveaccount a home worth safe, conservative side earning $100,000 you ownwould free and 8%. Yourwhich side account beclear. worthIf the home appreciates ownyear. an asset $108,000 at the5%, endyou of the You worth still own theat home, which appreciated 5% and $105,000 the end of the year. is worth $105,000. By separating the equity
Separating equity to increase rate of return What do you think the rate of return on home equity was in Seattle for the last 3 years? What about Portland? Careful, this is a trick question. The truth is, it doesn’t matter where you live or how fast the homes are appreciating, the return on home equity is always the same, ZERO. We have a misconception that because
Now, assume a new you asset had which separated the you created was also $100,000 of home and Therefore, placed it in a able to earn a rateequity of return. safe, sidemore account 8%. youconservative earned $8,000 thanearning you would have money werebe left to sit$108,000 idle Your sideif the account would worth in the home. To be fair, you do have a the at the end of the year. You still own mortgage payment you didn’t have before. home, which appreciated 5% and is worth However, since interest rates are relative, $105,000. By separating the equity you if we are assuming a rate of return of 8%, created a new asset which was also able to we can also assume a strategic interestearn a rate of return. Therefore, you earned only mortgage would be available at 5%. $8,000 moremortgage than youinterest would ishave the Also, since 100%iftax
money were left to sit idle in the home. To be fair, you do have a mortgage deductible, the net cost of thepayment money isyou didn’t have before. However, since interest only 3.6%. This produces a 4.4% positive spread betweenifthe of moneyaand rates are relative, we cost are assuming rate of the earnings on that money. return of 8%, we can also assume a strategic interest-only mortgage would be available at The story getsmortgage much more compelling 5%. Also, since interest is 100% tax over time, although the mortgage debt deductible, the net cost of the money is only remains constant, through compound 3.6%. This produces a 4.4% positive spread interest, the side account continues to between the cost of money and the earnings grow at a faster pace each year. The onearnings that money. on $100,000 in year 1 are $8,000. Then in year 2, the 8% earnings
The story gets much more compelling over on $108,000 are $8,640. In year 3, the time, although the mortgage debt remains earnings on $116,640 at 8% are $9,331. constant, compound interest, Since thethrough mortgage debt remains the the side account continues to grow at aoffaster same, the spread between the cost the pace each year. Theand earnings on $100,000 mortgage money the inearnings year 1 are Then inequity year 2, the 8% on$8,000. the separated continues widen further in the In year 3, earnings on to $108,000 are $8,640. homeowner’s favor every year. we$9,331. allow the earnings on $116,640 at 8% Ifare home equity to remain idle in the home, Since the mortgage debt remains the same, we give up the opportunity to put it to the spread between the cost of the mortgage work and allow it to grow and compound. money and the earnings on the separated equity continues to widen further in the Homeowners would actually be better off homeowner’s favor everybackyards year. If we burying money in their thanallow
home equity to remain idle in the home, we give updown the opportunity to putsince it to work and paying their mortgages, money allow it to grow and compound. buried in the backyard is liquid (assuming you can find it), and its safe (assuming Homeowners would actually neither be better no one else finds it). However, is off burying amoney their backyards than paying earning rate ofinreturn. It’s actually losing down their mortgages, since money buried value due to inflation. Few people today in the backyard liquid (assuming you can find bury money inisthe back yard or under their mattresses, because they have confidence it), and its safe (assuming no one else finds it). in the banking system. They also understand However, neither is earning a rate of return. idle money loses value while invested It’s actually losing value due to inflation. Few money grows and compounds. As Albert people today bury money in the back yard or Einstein said, “The most powerful force in under their mattresses, because they have the universe is compound interest.” After all, confidence in the banking system. They also homes were built to house families, not store understand idle money losesto value while cash. Investments were made store cash.
invested money grows and compounds. As Albert from Einstein said, “The mostsuppose powerfulyou force Taken a different angle, in theoffered universe is compound After were an investment thatinterest.” could never go in value, might down. How not all,up homes werebutbuilt to go house families, much of it would you want? Hopefully store cash. Investments were made tonone. store Yet, cash.this is home equity. It has no rate of
return, so it cannot go up in value, but it could go down in value if the real estate marketyou Taken from a different angle, suppose declines or the homeowner experiences an were offered an investment that could never uninsured loss (e.g. an earthquake), disability, go up in value, but might go down. How much or a foreclosure
“Homes are designed to house families,not store cash.” “Investments are designed to store cash.” 5%.we It’sgive whatupmakes millionaires, millionaires! had $100,000 of equity in of it would you want? Hopefully none. Yet, this TheLet’s home, the “opportunity” to earn a The power of leverage costsayofyou not borrowing Learn to be your own banker. By using the your home that could be separated. Current
is home equity. It hasano ratecan of return, so it 5 percent return on the money. Let’s be clear, buying home be a great (employment cost vs.isopportunity cost) principles that banks and credit unions use, mortgage interest 5%, so the cost of that cannot go up in value,thebutwealthy it could gothe down investment. However, buy you can amass a fortune. A bank’s greatest money would be $5,000 per year (100% tax By separating the equity we give it new life. in value if as thelittle realofestate market declines home with their own money as or When homeowners separate equity to assets are its liabilities. You can substantially deductible). Rather than bury the $100,000 We give ourselves the opportunity to put it to possible, leaving the majority ofan their cash in the homeowner experiences uninsured reposition it in a liquid, safe,going side to account, net worthon byit.optimizing in the backyard, we are put it toa workenhance and earnyour something Assumingthe a other investments where it’s liquid, safe, and loss (e.g. an earthquake), disability, or a mortgage payment is created. The mortgage assets that you already have. By being your work, or “employ” it. If I were an employer, 28 percent tax bracket, the net employment earning a rate of return. One of the biggest foreclosure own banker you can make an extra $1 Million why would I be willing hire an assistant payment is considered the to Employment Cost. cost for is not 5%, but 3.6%, or $3,600 per year misconceptions homeowners have is that their retirement. for $35,000 per year? The expectation is I What many people don’t understand is when home is the best investment they ever made. after taxes (mortgage interest is 100% tax am going to be able to grow my business If you purchased a home in 1990 for $250,000 we leave equity trapped in our home, we incur deductible). It’s not too difficult to find tax and earn a profit on it. As a business owner, to create an extra and sold it in June of 2003 for $600,000, that the same cost, but we call it a lost Opportunity free How or tax deferred investments earning I believe that by investing in an assistant I Let’s be clear, buying a home can be a Cost. represents a gain of 140%. During the same dollars fortaxretirement will earn a return that’s greater than the costmoremillion than 3.6%. Using the benefits of a period, the Dow Jones grew fromthe 2590 to 9188, great investment. However, wealthy of employing that assistant. If we choose to you can create your own arbitrage that’s parked in your home doing mortgage, By repositioning $200,000 into an equity a gainthe of 255%. realityashere is that buy homeThewith little of financing their The money leave the $100,000 of equity in our home, by management borrowing at one rate and earning account with a financial advisor could be put to work earning you your was the investment decision own home money as best possible, leaving the nothing we incur almost the same cost. The only you can achieve gain ofhigher $1 million investment returns ata net a slightly rate. that you ever made. When you purchased the something. majority of their cash in other investments difference is, instead of referring to that cost over thirty years. Assume you separate the It’s what the banks and credit unions do all $250,000 house in 1990, you only put $50,000 employment cost, it is referred to as an where it’s liquid, safe, and earning a rate of Let’sassay $200,000 of home equity using a mortgage you had $100,000 of equity in down. The $50,000 cash investment produced a borrow our money at 2% and opportunity cost. By leaving the equity in thethe time.aThey return. One of the biggest misconceptions 5% interest rate. If the $200,000 profit of $350,000. That is a total return of 600%,your home that could be separated. Current thenwith loan it back to us at 5%. It’s what makes home, we give up the “opportunity” to earn a grows homeowners have is that home is mortgage at a conservative rate of 6.75% per far outpacing the measly 255%their earned by the interest is 5%, so the cost of that millionaires, millionaires! Learn to be your 5 percent return on the money. year, it will be worth $1,419,275 in 30 years. the best investment they ever made. If you stock market. money would be $5,000 per year (100% tax own banker. By using the principles that After deducting the $216,000 in interest purchased a home in 1990 for $250,000 deductible). Ratherthe thanequity bury the $100,000 By separating we give it newinlife. banks and credit use, youmortgage, can amassyou payments andunions the $200,000 and sold it inofJune 2003 for $600,000, the backyard, The cost notofborrowing we are going put it to work, or it toa fortune. We give ourselves the to opportunity to put A bank’s greatest assets are itsA still have $1,003,275 left in your account. that represents acost gainvs. of 140%. During cost) the “employ” work it. and on why it. Assuming If Iearn weresomething an employer, would I a liabilities. (employment opportunity net gain over one million enhance dollars. your Youofcan substantially same period, the Dow Jones grew from be willing 28 percent tax bracket, the net employment to hire an assistant for $35,000 per net worth by optimizing the assets that you When homeowners separate equity to reposition isexpectation not 5%, butis3.6%, or $3,600 per year 2590 to 9188, a gain of 255%. The reality year?cost The I am going to be able Thishave. example simplyyour shows timeyou already By being owna one banker it in a liquid, safe, side account, a mortgage after taxes (mortgage interest is 100% tax here is that financing your home was the to grow repositioning of equity. Imagine how the my business and earn a profit on it. As an extra $1 Million for retirement. payment is created. The mortgage payment is deductible). It’s not too difficult to find tax can make best investment decision that you ever a business numbers grow for individuals that harvest owner, I believe that by investing in considered the Employment Cost. What many free or tax deferred investments earning and reposition their home equity every 5 made. When you purchased the $250,000 an assistant I will earn a return that’s greater people don’t understand is when we leave more than 3.6%. Using the tax benefits years as their home continues to appreciate! house trapped in 1990,inyou putwe$50,000 down. equity ouronly home, incur the same thanofthe cost of employing that assistant. a mortgage, you can create your ownIf This is how the wealthy manage their home The $50,000 investment produced cost, but we callcash it a lost Opportunity Cost. a we choose to leave the $100,000 equity arbitrage by borrowing at oneofrate and in equity to continually increase their net worth. profit of $350,000. That is a total return of our home, earning returns at a slightly weinvestment incur almost the same cost. The Conversely, if the same $200,000 $200,000 into an were equityleft The money that’s parked in your255% homeearned 600%, far outpacing the measly rate.is, It’sinstead what the andtocredit only higher difference of banks referring that By repositioning to sit idle in the home for 30 years, it would doing could be put to work earning you account with a financial advisor by the nothing stock market. unions do all thecost, time.it They borrow ouran management cost as employment is referred to as not have earned a dime. something. money at 2% and then loan it back to us at you can achieve a net gain of $1 million
The power of leverage
How to create an extra million dollars for retirement
opportunity cost. By leaving the equity in the
from the NASD: “Brokers are not prohibited Betting theAssume ranch;yourisking 401 vacation condo to make the mortgage payments. client over thirty years. separatehome the investment recommendations. This would include from making such a recommendation per $200,000 home equity using a mortgage adequately explaining the inrisks such an equityofto buy securities Many successful people the of Northwest se, equity so longisas Serious the investment isWe reasonably Home Money. don’t with a 5% interest rate. If the $200,000 grows which and are buying significant, to the dream of retiring a second suitable for investment in general, it is investment, Recently the NASD issued an alert, “… gamble home equity. Liquidity and and safety at because a conservative rate of 6.75% per year, it investor.” The NASD simply wants to ensure home in Arizona or Hawaii. With one suitable for the specific customer. 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This You would can make client recommendations. include offset 401k withdrawals meet monthly mortgage payments.” The or aggressive over onetheir million dollars. condo they need to withdraw nearly adequately explaining the risks of such an NASD is absolutely correct in advising againstthousands of dollars by simply borrowing at $500,000 fromretirees their 401K/IRA. What if Most successful have the majority investment, which areinsignificant, to the if the client must relytime on 5% and investing at 5% safe conservative Thisseparating exampleequity simply shows a one instead they had purchased the condo The NASD simply wants ensure of their assets in their home equity and the returns from their investment make investments without ever togoing repositioning of equity. Imagine to how thethe fixedinvestor.” 15 years earlier, cost $175,000, by consumers are receiving prudent advice. mortgage payments. As theywhen start itwithdrawing funds numbers grow for individuals that harvest into securities. In general, individuals IRA/401Ks. using the equity in their home? equity is Serious Money. We don’t andHome reposition their home equity every 5 should not invest home equity for “current from their IRA/401Ks, they are hit with a gamble home equity. Liquidity and safety are annual tax bill. Moreover, the kids Tax deductions to offset unless the investment is fixed significant years as their home continues to appreciate! income” Today their net worth would be $175,000 the key philosophies when have moved thecondo’s mortgage is paid, and withdrawals guaranteed. Individuals interested in Thisseparating is how the wealthy manage home and 401k higher, dueout, to the appreciation, home equity. Rate oftheir return tax and deductible contributions to 401Ks have they would have the mortgage should have ask themselves, equity to continually increase their is a distant third benefit. Also, it isnet notworth. variable Mostinvestments successful retirees the majority stopped. When they could useoff-set the mortgage interest deduction to help their make inmytheir mortgage payment Conversely, therecommended same $200,000 were left necessaryif or to invest in to “How of will theirI assets home equity and if IRA/401K withdrawals. In addition to the interest deduction the most, they don’t have or aggressive I have reserve sit highly idle involatile the home for 30 years,investments. it would not my investments IRA/401Ks. Asdecline? they startDo withdrawing funds financial advantages, they would have it. As part of long term planning, someone You can make thousands of dollars by simply funds from IRA/401Ks, they are hit with a or their a secure income?” In April 2004, have earned a dime. enjoyed the lifestyle benefits of may owning is preparing for retirement want borrowing at 5% and investing at 5% in safe the significant tax bill. following annual question wasMoreover, posed tothethekids whotheir vacation condo 15 years sooner conservative fixed investments without ever NASD, to have a mortgage going into retirement have moved out, the mortgage is paid, and “Where can I find the exact language than they planned. Betting thesecurities. ranch;Inrisking going into general, individuals tax deductible contributions to 401Ks have to help offset the annual IRA/401k tax bill prohibiting a broker from recommending that shouldequity not invest for “current stopped. When they could use the mortgageand enhance their overall financial goals. home tohome buyequity securities I takeinterest a mortgage out on my house and invest income” unless the investment is fixed sam your deduction the most, they don’t haveFor Making many, the uncle mortgage interest deduction the money in of securities?” writtensomeone answer and guaranteed. Individuals interested in it. As part long termThe planning, Recently the NASD issued an alert, “…because best partner offsets taxes due on retirement withdrawals, the isNASD: “Brokers are not prohibited investments should ask preparing for retirement may want wevariable are concerned that investors whothemselves, must rely fromwho thetax netlaw effect free withdrawals Under you of cantax deduct up to one fromtomaking such a recommendation per giving will I make mytomortgage if have a mortgage going into retirement on “How investment returns make theirpayment mortgage from their retirement account. million dollars of mortgage interest subject my investments decline? Do I have reserve to help annual IRA/401k tax bill long offset as thethe investment is reasonably payments could end up defaulting on their se, so to income restrictions. You can also deduct funds or a secure income?” In April 2004, and enhance their overall financial goals. suitable for investment in general, and it is home loans if their investments decline an additional $100,000 from home equity the following question was posed to the For many, thespecific mortgage interest deduction suitable for the customer. In order 401 vacation condo andNASD, they “Where are unable meet loan interest. To take advantage of these can Itofind the their exact monthly language offsets taxessuitability, due on retirement to determine a brokerwithdrawals, should mortgage payments.” The NASD is absolutely deductions, make sure to secure a large prohibiting a broker from recommending that giving the net effect of tax free withdrawals Many successful people in the Northwest consider the client’s investment objectives, mortgage when you buy. Under tax law, correct inaadvising against separating if I take mortgage out on my houseequity and invest from their retirement account. dream of retiring buying only a second mortgage interest and is deductible for money securities?” The written thethe client mustinrely on the returns from answer their financial status, tax status, and any other information a firm uses to make suitable home in Arizona or Hawaii. With one million
dollars or more saved in their IRA/401Ks, they decide to retire and buy the vacation home where they will spend their winters. What a surprise when they discover that to pay cash for a $350,000 condo they need to withdraw nearly $500,000 from their 401K/IRA. What if instead they had purchased the condo 15 years earlier, when it cost $175,000, by using the equity in their home? Today their net worth would be $175,000 higher, due to the condo’s appreciation, and they would have the mortgage interest deduction to help off-set their IRA/401K withdrawals. In addition to the financial advantages, they would have enjoyed the lifestyle benefits of owning their vacation condo 15 years sooner than they planned. Making uncle sam your best partner Under tax law you can deduct up to one million dollars of mortgage interest subject to income restrictions. You can also deduct an additional $100,000 from home equity loan interest. To take advantage of these deductions, make sure to secure a large mortgage when you buy. Under tax law, mortgage interest is deductible only for $100,000 over acquisition indebtedness (the mortgage balance when home is purchased). Home improvements are the only exception. For example, if you sell your home for $400,000 and buy a new home for $400,000 with the cash from the sale, you will lose the tax break and liquidity. But worse, if you later decide to take out a home equity loan, only the first $100,000 will be tax deductible. Instead, secure a $360,000 mortgage (90%) when you buy the home and the entire amount is deductible.
vehicles. Tax favored safe investments are ideal. You should consult your financial planner for the best investment vehicles for your specific situation. Many financial planners prefer the following tax favored products for investing home equity: • Investment grade insurance contracts • Annuities • Real estate investment trusts • IRAS • 401ks • Tax-free bonds • 529 savings plan
Case study: home equity management There’s a recent case study of a couple living in a $550,000 home in Bellevue, WA. They owed $360,000 on a 30-year fixed mortgage at 5.875% with a monthly payment of $2,130. They had $190,000 built up in home equity. A very common “Brother A”-type traditional scenario. After understanding the liquidity, safety, rate of return, and tax benefits of properly managing their home equity, this couple decided to separate $155,800 of their equity to invest in a safe conservative side account. By using an interest-only ARM they were able to increase their mortgage balance to separate this chunk of equity while decreasing their monthly mortgage payment to $1,656, a monthly cash flow savings of $474 per month.
The couple conservatively invested the $155,800 lump sum and the $474 per month savings with their financial planner. If we assume a conservative 6% rate of Where to safely invest return, their investment account will grow to home equity $520,196 in 15 years. In the 15th year, they Home equity is serious money. We are will have enough cash in their investment separating it from the home to conserve it, account to pay off their mortgage completely not to consume it. Therefore it should not be if they want to (15 years earlier than with invested aggressively. Rather, home equity is their original 30 year mortgage!). However, best invested in safe, conservative investment armed with their new equity management
knowledge, they plan to keep the mortgage well into retirement so they can keep the tax deduction benefits and keep the money in the investment account where it’s more liquid, more safe, and will continue to grow and compound.
Connect with Reza
970.218.3109
PATERSON
Case study: cash flow management It’s not necessary to have a large chunk of equity in your home to benefit from using your mortgage to create wealth. Many homeowners without a large equity balance have benefited by simply moving to a more strategic mortgage which allows them to pay less to their mortgage company each month, thereby enabling them to save or invest more each month. For example, a couple in Redmond, Washington followed traditional thinking when they bought their $400,000 home. They put 20% down and obtained a $320,000 30-year fixed rate mortgage at 6.00% with a payment of $1,919 per month. This is how the vast majority of Americans would purchase this home. However, once this couple understood the benefits of integrating their mortgage into their financial plan, they decided to make a change. They moved to a more strategic interest-only mortgage. They kept the same loan balance, but were able to reduce their monthly payments to $1,133 per month, a savings of $786 per month from their previous mortgage. The couple invests the $786 savings each month, and assuming a 6% rate of return, they will have enough money in their investment account to pay off their mortgage in 19 years (11 years sooner than their previous 30 year schedule!). Therefore, by simply redirecting a portion of their monthly mortgage payment, they were able to potentially shave 11 years off their mortgage. In addition, they also received the benefits of having their cash in a more liquid, more safe position throughout the process.
Guiding you from where you are, to where you want to be.
LIFE PLAN LifePlan is a facilitated journey that helps you discover your unique purpose in life. LifePlan will guide you to discover your purpose and provide you with a clear strategic plan to live it out.
STRATOP StratOp is a strategic system, designed to help you grow your organization. Beginning with a 3-day facilitated planning process, StartOp will leave you with a clear strategic plan.
What if you could see your way forward? Where would it take you? The Paterson Process, refinded by over 40 years of proven success, is tailor-made to help individuals and teams gain the insight they need to do just that. In a world of confusion; clarity and purpose are not only necessary, they’re possible, and we’re here to guide you there. As the Chaplain for the Denver Broncos, and in my work with Athletes in Action, it’s my honor to come alongside individuals, and organizations of any shape and size, to guide them to the clarity they need.
Interested in learning more? Contact Reza at 970.218.3109 or support@PatersonCenter.com
Res t style living JUST MINUTES FROM THE CITY!
3 BEDS | 3 BATHS | 3-CAR DETATCHED GARAGE | 3,598 SQUARE FEET 1.06 ACRE LOT | WATER RIGHTS INCLUDED | LISTED AT: $1,099,000 Resort style living just minutes from the city! A private oasis of luxury, security, & relaxation. This one of a kind property sits on a 1+ acre lot with private gated call pad entry. Secured with a 7’ concrete wall with sandstone accents around the perimeter & sophisticated security camera technology featuring off site monitoring. An entertainers paradise with gazebo, koi pond, waterfall, & canal with walk over bridges. Professionally landscaped & decorated with native flowers. The highest level of finishes featuring imported stones, Venetian plaster, custom Blum cabinetry, Sub-Zero refrigerator, & professional grade Viking appliances. Energy management systems, heated flooring, lighting, & communication using smart home technology. Core construction uses concrete walls filled with 8” of foam for max efficiency. Indoor pool & hot tub with fitness room & Venetian plaster wave ceiling. Copper gutters, downspouts, & chimney. 3 car garage with 700 sq ft loft for storage or guest suite.
JADEN HANSON, Realtor®
303.910.2243 jaden@milehighlifestyles.com www.milehighlifestyles.com
Be smart... Ask questions… Get answers!
CONSUMER REPORT– HOME LOANS
SHOPPING AROUND?
More than likely, this is one of the largest and most important financial transactions you will ever make. You might do this only four or five times in your entire life… but we do this every single day. It’s your home and your future. It’s our profession and our passion. We’re ready to work for your best interest.
HERE'S THE INSIDE SCOOP ON HOW TO DO IT RIGHT
First: make sure you are working with an experienced, professional loan officer. The largest financial transaction of your life is far too important to place into the hands of someone who is not capable of advising you properly and troubleshooting the issues that may arise along the way. But how can you tell?
Here are FOUR SIMPLE QUESTIONS YOUR LENDER ABSOLUTELY MUST BE ABLE TO ANSWER CORRECTLY. IF THEY DO NOT KNOW THE ANSWERS… RUN…DON’T WALK… RUN…TO A LENDER THAT DOES!
1 3 4 2
What are mortgage interest rates based on?(The only correct answer is Mortgage Backed Securities or Mortgage Bonds, NOT the 10-year Treasury Note. While the 10-year Treasury Note sometimes trends in the same direction as Mortgage Bonds, it is not unusual to see them move in completely opposite directions. DO NOT work with a lender who has their eyes on the wrong indicators.) What is the next Economic Report or event that could cause interest rate movement? (A professional lender will have this at their fingertips. For an up-to-date calendar of weekly economic reports and events that may cause rates to fluctuate, visit our Facebook page Finance of America Mortgage – Bryan
Johnson Lending Team – for daily updates. Want more? Let me know if you want to be added to my weekly distribution list.
When Janet Yellen {Chairmen of Federal Reserve} and the Fed “change rates”, what does this mean… and what impact does this have on mortgage interest rates?(The answer may surprise you. When the Fed makes a move, they can change a rate called the “Fed Funds Rate” or “Discount Rate”. These are both very shortterm rates that impact credit cards, Home Equity credit lines, auto loans and the like. On the day of the Fed move, Mortgage rates most often will actually move in the opposite direction as the Fed change. This is due to the dynamics within the financial
markets in response to inflation. For more information and explanation, just give us a call). Do you have access to live, real time, mortgage bond quotes?(If a lender cannot explain how Mortgage Bonds and interest rates are moving in real time and warn you in advance of a costly intra-day price change, you are talking with someone who is still reading yesterday’s newspaper, and probably not a professional with whom to entrust your home mortgage financing. Would you work with a stockbroker who is only able to grab yesterday’s paper to tell you how a stock traded yesterday, but had no idea what the movement looks like at the present time and what market conditions could cause changes in the near future? No way!)
SHOPPING... PART 2 Once you are satisfied that you are working with a top-quality professional mortgage advisor, here are the rules and secrets you must know to “shop” effectively. FIRST, IF IT SEEMS TO GOOD TO BE TRUE, IT PROBABLY IS. But you didn’t really need us to tell you that, did you? Mortgage money and interest rates all come from the same places, and if something sounds really unbelievable, better ask a few more questions and find
the hook. Is there a prepayment penalty? If the rate seems incredible, are there extra fees? What is the length of the lock-in? If fees are discounted, is it built into a higher interest rate? SECOND, YOU GET WHAT YOU PAY FOR. If you are looking for the cheapest deal out there, understand that you are placing a hugely important process into the hands of the lowest bidder. Best case, expect very little advice,
experience and personal service. Worst case, expect that you may not close at all. All too often, you don’t know until it’s too late that cheapest isn’t BEST. But if you want the cheapest quote – head on out to the Internet, and we wish you good luck. Just remember that if you’ve heard any horror stories from family members, friends or coworkers about missed closing dates, or big surprise changes at the last minute on interest rate or costs… these are often due to working with discount or internet lenders who may have a serious lack of experience. Most importantly, remember that the cheapest rate on the wrong strategy can cost you thousands more in the long run. This is the largest financial transaction most people will make in their lifetime. That being said – we are not the cheapest. Of course our rates and costs are very competitive, but we have also invested in the systems and team we need to ensure the top quality experience that you deserve.
THIRD, MAKE CORRECT COMPARISONS. When looking at estimates, don’t simply look at the bottom line. You absolutely must compare lender fees to lender fees, as these are the only ones that the lender controls. And make sure lender fees are not “hidden” down amongst the title or state fees. A lender is responsible for quoting other fees involved with a mortgage loan, but since they are third party fees – they are often underquoted up front by a lender to make their bottom line appear lower, since they know that many consumers are not educated to NOT simply look at the bottom line! APR? Easily manipulated as well, and worthless as a tool of comparison. FOURTH, UNDERSTAND THAT INTEREST RATES AND CLOSING COSTS GO HAND IN HAND. This means that you can
have any interest rate that you want – but you may pay more in costs if the rate is lower than the norm. On the other hand, you can pay discounted fees, reduced fees, or even no fees at all – but understand that this comes at the expense of a higher interest rate. Either of these balances might be right for you, or perhaps somewhere in between. It all depends on what your financial goals are. A professional lender will be able to offer the best advice and options in terms of the balance between interest rate and closing costs that correctly fits your personal goals. FIFTH, UNDERSTAND THAT INTEREST RATES CAN CHANGE DAILY, EVEN HOURLY. This means that if you are comparing lender rates and fees – this is a moving target on an hourly basis. For example, if you have two lenders that you
just can’t decide between and want a quote from each – you must get this quote at the exact same time on the exact same day with the exact same terms or it will not be an accurate comparison. You also must know the length of the lock you are looking for, since longer rate locks typically have slightly higher rates. Again, our advice to you is to be smart. Ask questions. Get answers. As you can imagine, we wouldn’t be encouraging you to shop around if we weren’t pretty confident that we feel that we can give you a great value and serve you the very best.
127 5th. Street Loveland, CO verbotenbrewing.com 970.775.7371
Tell us what got you in to this crazy business? I have been in public relations my whole life, and found being a Real Estate Agent was a great fit for my skill set. I very much enjoy advocating for the people that I work with.
What is your favorite documentary or movie? Hope Floats. What purchase of $100 or less has most positively impacted your life in the last 6 months? Baskets for foster children that have aged out of the system and need to move into their own apartments. What obsessions do you explore on the evenings or weekends? Moving to an island. What is the best or most worthwhile investment you’ve made? Could be an investment of money, time, energy, or other resource. How did you decide to make this investment? My marriage to Todd! Do you have a quote you live your life by or think of often? “Sometimes you live your life in chains and you never knew you had the key”. If someone told you they were thinking about becoming a real estate agent what advice would you give them? Save enough money to be self-sufficient for 2 years beforehand. Tell us something about yourself that most people don’t know? I wanted to be in movies and sing like Debbie Reynolds. I was named after her from my Mom because she liked the movie “The Unsinkable Molly Brown.” Do you have any interesting hobbies or talents? Caring for my family, traveling, cooking, and interior design. What is something really weird or unsettling that happens to you on a regular basis? I see numbers i.e., 11:11, 12:22, 3:33, 4:44, 5:55 often multiple times and multiple sequences a day! What do you believe is true, even though you can’t prove it? God and Jesus.
Deborah Davidson REALTOR®
“Sometimes You live your life in chains and you never knew you had the key.”
303.847.1893 deborahdavidson@hubreal.com www.hubreal.com
What are you passionate about? I love competitive Ballroom Dancing! I started about 7 years ago and because of my fantastic instructor, I have done very well. I also enjoy auto racing of all kinds and worked in Drag Racing when I was a little younger. Do you have a mission statement? I do. I always remember that I work for you! My Clients are #1. What are your sales numbers for the last 12 months? 30 sales at a volume of 13 million dollars. What areas do you specialize in? Residential, Farm, & Ranch. Tell us about your family. I am a father of two beautiful kids, Ryan & Miranda. They are the love of my life! My son is working in the construction field and moving his way up the ladder. My daughter is pre-med and working on her dream of becoming a dentist. I am so honored to be a part of their lives. When you think of the word “Successful”, who’s the first person that comes to mind and why? Successful to me means someone that has balance between work and life. My mother. She was a great Realtor that always had time for her 13 children. Do you have any mentors? Cliff Johnson, long time Realtor in Northern Colorado. Who has been the most influential person in your career? Cliff Johnson. What are some of your goals for 2018? 40 sales, 20 million dollars. What is something you believe that other people think is insane? Dancing like the judges are watching. What is the book {or books} you’ve given most as a gift? The Other Einstein. Do you do anything really cool for a closing gift for your clients? 4 dance lessons. What is your favorite documentary or movie? Rabbit Proof Fence. What purchase of $100 or less has most positively impacted your life in the last 6 months? Air fryer. Do you have a personal or business coach? Yes, Jason Black. What does the first 60 minutes of your day look like? First hour I ‘m at the gym. What obsessions do your explore on the evenings or weekends? It’s always nice to take a good, long hike. What topic would you speak about if you were asked to give a talk on something outside of real estate? The orphans in Africa. During a trip to Uganda my eyes were opened to the very real problem of children that are on their own after the 7th grade. I am volunteering with HELP International to do what I can. What is the best or most worthwhile investment you’ve made? Could be an investment of money, time, energy, or other resource. How did you to make this investment? Coaching baseball. My son’s team needed a coach and I accidentally rose my hand. Do you have a quote you live your life by or think of often? Everyone has a purpose in this life and a unique talent to give to others. What is the worst advice you hear being dispensed in your world? That’s not your job. If someone told you they were thinking about becoming a real estate agent what advice would you give them? Do it. We need honest, hard working, driven people. If you could have one gigantic billboard anywhere with anything on it, what would it say? You’ve got this! What advice would you give your 20-, 25- or 30-year old self? This life is a roller coaster, hang on and enjoy the ride. Tell us something about yourself that most people don’t know? I have 6 brothers and 6 sisters. Do you have any interesting hobbies or talents? All that Colorado has to offer; hiking, biking, rock climbing, skiing, boating, etc. How has a failure, or apparent failure, set you up for later success? Or, do you have a favorite failure of yours? I had been in a business that was poorly managed by a partner and should have said something sooner. This taught me to always pay attention to all of the moving parts,. Don’t just assume someone else has it . What is something really weird or unsettling that happens to you on a regular basis? Electronics will stop working or not work correctly around me. What have you changed your mind about in the last few years? Why? Beets. Not sure why but they taste good now. What is something that you knew for certain was true and later found out it was not? George Washington had wooden teeth. He had dentures, just not wooden. What do you believe is true, even though you can’t prove it? Everyone is here for a reason. Last parting words? I would love to have the opportunity to work for you.
Paul Jansen
REALTOR®
970.567.4757
Paul.Jansen@ColoradoHomes.com www.PJRealty.net
Ani has lived in the community for nearly 20 years, and is a Colorado State Alumni, specializing in the Northern Colorado market. She brings a fresh experience to buying or selling your home.You will immediately notice her attention to detail and ability to hear your needs, wants, and desires. One of her biggest assets is her integrity and always having your best interests in mind. Ani is part of an incredible team with Key Partners at Coldwell Banker, collectively bringing over 50 years of experience in residential real estate. It is no surprise that the wonderful culture of this team has helped to create amazing experiences for their clients. In 2017, Key Partners was ranked 6th in the Nation at Coldwell Banker for large teams. The great thing about having the support of a team is that there is always someone available to make you a top priority. With a background in architecture and interior design, she brings a keen eye and knowledge to your real estate experience. This adds substantial value to finding a home that fits your family. Everyone comes with a unique set of needs and Ani’s intuitive ability to discern her clients’ needs is unmatched in the field. As a wife and mother of three, family is a big part of why she strives to be the best (and also why she is a time management genius). Rest assured when you are her client you’ll be taken care like you are part of her family. What are you passionate about? I am passionate about interior design. I love making spaces beautiful. I have a background in interior design and love that with real estate, it has come full circle. What are some of your goals for 2019? To double my transaction volume from the prior year.To successfully make time for a family vacation and as well as a getaway with my husband. What is something you believe that other people think is insane? That I can literally think things into existence. What you think about, you bring about. Do you do anything really cool for a closing gift for your clients? Closing gifts depend on the client. Each one is individual based on our connection through the home buying or selling process. For example, one of my clients was in love with shabby chic, so I had a chalk drawing of her new home done on a framed chalkboard for her. What is your favorite documentary or movie? Making a murder series, or anything crime related. What topic would you speak about if you were asked to give a talk on something outside of real estate? The importance of sports for children. It has taught me so much through my life through my dedication to figure skating when I was younger. That dedication and perseverance has helped me though other aspects of my life. If someone told you they were thinking about becoming a real estate agent what advise would you give them? To always be planting seeds and take the time to water and nurture your seed so that you can eventually see the fruit of your labor. If you could have one gigantic billboard anywhere with anything on it, what would it say? Talk about your blessings more than you talk about your burdens.
Tell us what got you in to this crazy business? The number one reason is that I enjoy helping people and assisting them achieve their real estate goals. I am very enthusiastic about Real Estate and feel satisfied knowing that I help people through major times in their lives. From a new couple buying their first house, to couples expanding their families, or getting a vacation home, or someone getting a new bachelors pad, I get to help people through each stage in their lives and be a part of a community. When you’re a real estate agent you have many roles because the real estate profession is more than just buying and selling homes. You become part counselor , part mentor and a part life coach. That’s very rewarding for someone like me who has a passion for giving back. I just love everything about my job. What are you passionate about? I have a burning passion for Real Estate and I absolutely enjoy helping others achieve their goals because I believe in people and their dreams! Do you have a mission statement? My mission statement is- “You’ve dreamed it! Now own it! What areas do you specialize in? I specialize in Residential Real Estate in the Denver Metro area. Thanks to my knowledge, skills and experience about the housing market , I became an expert at educating my clients so they can make the best and informed decisions for their needs. When you think of the word “Successful”, who’s the first person who comes to mind and why? There are over 7 billion human beings on this planet, yet not everyone agrees on this term called ‘’success’’, what it means and what it should look like . Personally, I believe that Success is a combination of a few things - having the financial freedom to explore whatever it is you want to explore , loving what you do, what you have and a continued expansion of happiness. When I think of the word ‘successful ‘, the first person who comes to my mind is Dr. Anstasia Petkova. She is a friend of mine and also my dentist. She owns a dental office in downtown Denver. She built a career out of her passion to help people. She is an amazing person who works hard, enjoys what she does and inspire people. I admire her dearly for it. Who has been the most influential person in your career? There are a lot of people who have had tremendous influence in my career .The most influential people have been my husband, my parents and also Sheryll White -the broker owner at Exit Realty DTC. My husband has supported me and he encouraged me to pursue my dreams ,while challenging myself to be the best that I can be in my career as a real estate agent. He is ultimately my back bone. He has always been there to instill my competitiveness and kindness. My parents influenced my career by the way I was raised - Ethics, accountability, responsibility, truth. When I told them about my plans to become a real estate agent, they said that if this was my true passion, I would have to follow through with it and don’t look back. Another person that has been a huge influence in my career is Sheryll White .She has always been there since day one of my career .She has shown me dedication and inspired me to work my hardest .She is consistently positive and determined to help everyone around her. She is a great goal-setter and has inspired me to set high goals for myself and to work hard to reach them. What are some of your goals for 2019? My goals as a real estate professional for 2019 are to close more deals by helping more people achieve their real estate goals, work hard and keep being honest and genuine with my clients and to operate my business with the highest degree of integrity. I want to make sure I deliver world class service and build long lasting relationships with my clients! What is the book {or books} you’ve given most as a gift? The book I have given most as a gift is “You Are a Badass: How to Stop Doubting Your Greatness and Start Living an Awesome Life” by Jen Sincere and the second one is “The Last Night of the Earth Poems” by Charles Bukowski. Do you do anything really cool for a closing gift for your clients? I love surprising my clients with cool closing gifts. One of the best closing gift I still use today is a personalized cutting board. It allows me to personalize it with their names and an inspirational quote and at the bottom is written: Thank you! Other really cool closing gifts that are Nesspesso coffee machine for my coffee lover clients and a ‘’I robot” vacuum cleaner. I try to get them something relevant to their interests or hobbies. What is your favorite documentary or movie? “ The Godfather”. I think it shows a mastery of the art of film production, acting and direction. What are your morning rituals? What does the first 60 minutes of your day look like? The first thing I do in the morning is showering and brushing my teeth :))) The next thing is making myself a coffee and reading the newspaper. I just love to be informed. That is a part of my morning ritual that hasn’t changed for a while and I enjoy it very much. Then I make breakfast for my family, drop my son at school and if I don’t have any showings early in the morning, I check my emails and make some phone calls. What obsessions do you explore on your free time? My obsession is reading books and traveling. My family and I, love to travel without expectations and with an open mind. Exploring nature, meeting people and learning about different cultures. What topic would you speak about if you were asked to give a talk on something outside of real estate? My favorite topic besides real estate is The power of positive thinking!!! I I believe that if you can re-program your mind to think positive, you can transform your life. What is the best or most worthwhile investment you’ve made? Could be an investment of money, time, energy, or other resource. How did you decide to make this investment? Getting my real estate license was one of the best investments I have ever made. I’ve always had an interest in real estate and I can’t be happier with the decision I made. Do you have a quote you live your life by or think of often? There are three quotes that I think of often - 1. If you can dream it, you can do it! 2. Inspire with passion and lead with confidence! 3. Either I will find a way, or I will make it! If someone told you they were thinking about becoming a real estate agent what advise would you give them? Work hard, be consistent and stay genuine to your clients . Present yourself and handle your business in a way that will separate you from the “pushy real estate salesperson image “ that people do not like. Beginning a new career as a real estate agent is exciting and you’ll want to hit the ground running. Remember that your long-term success depends on many things, but a good business plan is one of the most important ones. What advice would you give your 20-, 25- or 30-year old self? I would say one thing to my 20 , 25, 30 - Stay true to yourself , follow your dreams and keep moving forward, because you’ll do great! Do you have any interesting hobbies or talents? I am a very talented artist.I love drawing portraits of people.There are only a couple of people that know that- my family and my closest friends. Last parting words? Thank you for your invitation for this interview for Homeowners magazine and for giving me the opportunity to talk about real estate and myself.
Ani Cesario Bisnette
Seyla Choban
970.819.8968
720.690.0187
BROKER ASSOCIATE, STAGING CONSULTANT
ani.bisnette@coloradohomes.com
REALTOR®
seyla@exitrealtydtc.com www.seyla.denverhomesearchnow.com
Tell us what got you in to this crazy business? I was a recruiter and needed a bit more flexibility for my youngest son who then had a few developmental issues. I got in this business in 02 when I was 22 and had not a clue what I was doing. What are you passionate about? I love to look at things in a big picture and manipulate backwards. There is nothing better than to be with buyers and then the lightbulb of opportunity comes on! What area’s do you specialize in? Still after 17 years, I specialize in first time home buyers as well as wealth management by leveraging someone’s real estate. Tell us about your family. I’m a proud empty nester! I have two amazing sons, David & Michael, that are 22 & 18 and two great young adults that I got guardianship of in middle school. Delissia is 23 & Leighton is 22. What is something you believe that other people think is insane? Buy the expensive car! I’ve always purchased something a tad beyond my means…. it’s a huge motivator and every time for 17 years I’ve made it happen. Right now, my car is Vacations…. looking forward to going to Scotland and Germany in 2019. What purchase of $100 or less has most positively impacted your life in the last 6 months? Bluetooth Lightbulb, like $13….it connects with your phone and can play all of my audiobooks. What are your morning rituals? What does the first 60 minutes of your day look like? Coffee! I journal words of affirmation and work out. If I don’t do this first thing, it will never get done. What topic would you speak about if you were asked to give a talk on something outside of real estate? I was a teen mother and I think there is a huge opportunity to help them create self-sufficiency and empowerment. What is the best or most worthwhile investment you’ve made? Could be an investment of money, time, energy, or other resource. How did you decide to make this investment? My first home! At the age of 39 I’m debt free and it’s because of purchasing my first home. If someone told you they were thinking about becoming a real estate agent what advice would you give them? Connect with your sphere, love them and they will love you back. What advice would you give your 20-, 25- or 30-year old self? And please place where you were at the time, and what you were doing? Man, the big one is during the down turn in 2008, I was a chicken to buy too many properties (purchased three), If I could tell my 30-year-old self in 2008…Buy Buy buy!!! (I could retire right now if I did) Tell us something about yourself that most people don’t know? I love American Cheese . Do you have any interesting hobbies or talents? I’m an amazing cook…. southern cook, I got you and can give anyone a run for their money with my gumbo! What is something really weird or unsettling that happens to you on a regular basis? It’s definitely the disposability of this business, that there isn’t room for error and the mortgage industry is made up of mistakes already made. I know my job inside and out but most don’t know the difficulty of their own situation and will move to an inexperienced lender for a tad lower rate not realizing it could cost them in the end. What have you changed your mind about in the last few years? Why? BALANCE! I’ve gotten very good at saying NO, I find the more often I say no the better things go. What do you believe is true, even though you can’t prove it? American Cheese IS cheese Last parting words? I know consumers and realtors have choices when choosing a lender. Shop local because we are the same people that donate to your schools and support your community. I will survive any shift in this business.
Catherine Eusea SR. MORTGAGE LOAN OFFICER
“Sometimes a setback is really” a set up for better.
VANITY AFFAIR MODELS: CATHERINE EUSEA
SHIRLEY ORR
SEYLA CHOBAN
ANGELICA SERNA
PAUL JANSEN
ERIK LEDEZMA
LAURA RODRIGUEZ
ANI CESARIO BISNETTE
ARLENE MARGUEZ
970.297.2345 ceusea@amerifirst.us www.euseateam.com
DEBORAH DAVIDSON
CINTHIA GONZALEZ
Welcome Home 26406 E PEAKVIEW DR, AURORA CO
4 BED | 4 BATHS | 5,544 TOTAL SQ. FEET | 3 CAR GARAGE Welcome to this beautiful home in the highly sought after Beacon Point neighborhood! At nearly 6,000 square feet, this home is an entertainer’s dream! Meticulously maintained - pride of ownership shows throughout, giving it a brand new feeling. Expansive ceilings, eight foot doors, beautiful curved staircase, and top of the line flooring will draw you in the minute you walk through the door. Enjoy cooking in the spacious chefs kitchen with a huge center island, six burner stove with griddle, double oven, high end appliances, and tons of space to eat. Relax in the grandiose master bedroom complete with it’s own balcony and luxurious bathroom with a double shower and jetted tub. This home is situated on a quiet cul-de-sac with close proximity to DIA, DTC and Downtown Denver!
CAITLIN BOOTH, Realtor®
303.906.4827 caitlin.denverrealtor@gmail.com www.milehighlifestyles.com
Tell us what got you in to this crazy business? I fell in love with the industry after buying my first home and going through the struggle that I did to get my house. What are you passionate about? I’m passionate about helping others and fighting the continuous struggle of homelessness. Do you have a mission statement? Our mission is to help all families who are open to homeownership. What are your sales numbers for the last 12 months? Sold over $2 million dollars worth of properties. What area’s do you specialize in? Vail Valley and Denver & Surrounding. Tell us about your family. I am currently married with an amazing family. My husband, daughter, and son are my reasons why I push myself for a better life. When you think of the word “Successful”, who’s the first person who comes to mind and why? This will sound a bit cheesy but my parents. Success to me doesn’t mean a big house, new cars or big saving account. Success is a better quality of life. Being born in another country allowed me to see poverty at its worst and appreciate all the things America has to offer, good or bad. Do you have any mentors? My mentor is Hagen Kuhl. Possibly one of the smartest men I will ever meet. His love for Real Estate is truly inspiring and I think it has rubbed off on me. Who has been the most influential person in your career? My mentor is Hagen Kuhl. He is determined to push me to success, kicking and screaming. What are some of your goals for 2018? My goals for this year are to help 12 families find their homes and to influence 24 families into home ownership. What is something you believe that other people think is insane? Being kind can go a long way! What is the book {or books} you’ve given most as a gift? 7 Habits of Highly Effective People by Stephen Covey Do you do anything really cool for a closing gift for your clients? I normally get my families welcome doormats that way each time the walk in the door they think of me. What is your favorite documentary or movie? I’ve watched a lot but none were my favorite. What purchase of $100 or less has most positively impacted your life in the last 6 months? I bought my clients some tickets to a concert for under $100 and they have sent me a surprising amount of referrals. I was just trying to be nice. I remembered they loved a singer and that singer was in Denver (after closing) so I figured it would be a nice gesture. Do you have a personal or business coach? Yes, his name is Jesus. What are your morning rituals? What does the first 60 minutes of your day look like? I normally take my kids to school, come back to a warm cup of coffee and go for a quick walk to get some fresh air. What obsessions do your explore on the evenings or weekends? I’m obsessed with my kids so I explore the world with them. What topic would you speak about if you were asked to give a talk on something outside of real estate? I would possibly talk about being kind to others, paying it forward and never judge others because of the color of their skin or the clothes they wear. What is the best or most worthwhile investment you’ve made? Could be an investment of money, time, energy, or other resource. How did you decide to make this investment? The best investment I’ve made is my education. Knowledge is power & no one can take that away from you. Do you have a quote you live your life by or think of often? “The future belongs to those who believe in the beauty of their dreams” – Eleanor Roosevelt What is the worst advice you see or hear being dispensed in your world? “Be patient, things will come to you.” No- work for it and things will come to you! If someone told you they were thinking about becoming a real estate agent what advise would you give them? Do it. Best career choice I’ve done so far! Prepare yourself for a rollercoaster! If you could have one gigantic billboard anywhere with anything on it, what would it say? “Spread love, not hate” What advice would you give your 20-, 25- or 30-year old self? I would tell my younger self to stop what I’m doing and become a real estate broker. Tell us something about yourself that most people don’t know? I’m trilingual and working on my fourth language as we speak. I intend on knowing 5 languages by the time I am 60. Do you have any interesting hobbies or talents? I love to clean, not as my job but as a hobby. I will normally go to other people’s houses and clean. I’m artistic, friendly and super talkative once you know me. How has a failure, or apparent failure, set you up for later success? Or, do you have a favorite failure of yours? Failure in my previous careers has brought me to the success I have now in real estate. I have no room for it, so failure is not an option. What is something really weird or unsettling that happens to you on a regular basis? I dream of things that will happen in the future. What have you changed your mind about in the last few years? Why? I originally was married to my work. Now, I have my husband and two kids and wouldn’t change it for the world. What is something that you knew for certain was true and later found out it was not? A few friendships, Costco Tamales & Taco bell Burritos. What do you believe is true, even though you can’t prove it? Jesus has the perfect home for everyone and it may not be what they want, but what they need. Last parting words? Be kind to each other!
Angelica Serna ASSOCIATE BROKER
970.688.1125 angie@thekuhlteam.com www.thekuhlteam.com
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8 Habits of Millionaires By Holly C. Brauer, Financial Advisor and Wealth Manager
Imagine you look back on your life a year from now, and it is the best year of your life! What does it look like? What is your career? How much money did you make? How much did you save? What is your relationship with your family and loved ones? What are the things you are most passionate about that you had the freedom and time to do? All of these questions will help you get to your true why? Why is this important? Because if you want to become a millionaire, you must think like a millionaire. Have you heard the adage “You become what you think about?” Therefore, in order to think like a millionaire, you must study millionaires. From many years of research, daily habits can dictate how successful or unsuccessful you become in life. The good news is that all habits can be changed, and you can start implementing them today!
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Millionaire Mindset
Millionaires have a mindset they will become successful and wealthy. They envision it every day. Albert Einstein said, “Imagination is more important than knowledge.” If you could have anything in this world, would you go after it? So, what is stopping you now? Many people have a fear to fail. When Thomas Edison was asked how it felt to fail 1,000 times before inventing the light bulb, he replied, “I didn’t fail 1,000 times, the light bulb was an invention with 1,000 steps.” It’s all about how you perceive things, and mindset is everything! There are many millionaires who went broke several times, and even bankrupt, but learned the greatest lessons and never gave up until they succeeded. Start now by getting in the right mindset, and you will be unstoppable! Photo Credit: RB Branded (www.RBbranded.com)
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They wake up early and set goals
Many millionaires will have accomplished more by 9am, than the average person does in a day. They wake up early, and have crystal clear goals. More importantly, they pursue their own goals rather than living someone else’s dream. This gives them more passion, determination, and energy creating long-term happiness and success. Your goals act as a roadmap. Could you imagine showing up at the airport, and just hopping on any flight hoping to get to the right place? It would be difficult to plan a trip, without a destination in mind. Goals also create more opportunity and less obstacles. You focus on the positive, and stop noticing the negative. Start today by writing out your goals and dig deep until you get to your true why. Then start tomorrow
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by waking up three hours before you begin your workday. This strategy will help deal with disruptions, which can subconsciously make us feel like we have no control over our life. Get up early and tackle the top three things you want to accomplish that day!
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7
They have successful friends
We often hear you are as successful as the average five people you hang around. It’s the law of attraction. If you’re constantly hanging around negative people, then it will shift your mindset and can stop you from reaching your full potential of success. Remember, great minds discuss ideas, average minds discuss events, and small minds discuss people. If you’re the smartest person in the room, then you’re in the wrong room. Look for mentors and other successful people to surround yourself with, and re-evaluate your circle of influence. Even the negative news media can have an influence on you, and so you must be aware of your thoughts. Set a goal to go 30 days without listening to the news, and instead listen to a positive audiobook, podcast, or TedTalk to learn something new.
Must read books: “The Millionaire Next Door”
by Thomas J. Stanley and William D. Danko
“Think and Grow Rich”
by Napoleon Hill and Steve Harvey
“The Compound Effect” by Darren Hardy
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while saving time and money. If you’re not up for wearing the same thing every day, then make sure you plan tomorrow today.
They never stop learning
Millionaires read constantly and consistently, and would rather be educated than entertained. They read at least 30 minutes a day and read to maintain or acquire knowledge. They mainly read informative books on history, personal development, or biographies of other successful people. Set a goal to read a minimum of one educational book a month.
Photo Credit: Lark Pronty of Prime24photography
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They keep their mind and body fit by working out
Exercise is not only good for the body, but is great for the brain. Research shows that cardio helps grow neurons (brain cells) in the brain, and produces more glucose which fuels the brain. The more it grows, the smarter you become. Knock out 30 minutes of cardio a day, and read a book while you’re at it.
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They are mindful of the choices they make
Did you know on average we make over 35,000 decisions a day! You decide what time to set your alarm, if you hit snooze, should you brush your teeth or shower first, what you should wear, what you will eat, and the list goes on. Have you noticed that Steve Jobs and Mark Zuckerberg wore the same kind of outfits every day? Why? Because it was one less choice they had to make that day. Have you heard the term decision fatigue? It’s when your choices start to deteriorate after having a long session of decisions. The removal of just one decision can leave more room for mental space, and better productivity. By having a routine, your brain doesn’t have to work as hard and reduces stress,
They are aware of their spending habits
They live below their means, and don’t drive the nicest cars in the neighborhood. Have you read the book, “The Millionaire Next Door?” Years of research has gone into this book to study millionaires. What they found is the average millionaire doesn’t live in the biggest house or drive the fanciest car. In fact, often times the millionaire lives next door to you. These are the individuals who you wouldn’t recognize as millionaires unless you saw their bank accounts. They live below their means, and build their wealth in investments such as real estate, the stock market, and have multiple streams of income. Many times, it’s the broke people who make a good income, but overspend to live in a big house with many cars. They are house rich, but cash poor. Challenge yourself to save at least 15% of your income by paying yourself first. Then create a spending plan of needs and wants so you become in charge of your money, and it doesn’t control you. Subconsciously, you will think twice about every purchase.
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They become successful and pay it forward
Chances are millionaires had a good mentor along the way. They surround themselves with positive, influential people, and when they succeed they pay it forward. A great mentor, Mr. Bill Walsh, Founder and CEO of Business Coaching/ Venture Capital Firm of Powerteam International, says to create so much value in other people’s life and expect nothing in return. Living by this philosophy will set you up for success, and you’ll be surprised with what you get in return. Remember, small changes over time lead to great results. Implement these habits into your life, and you will be on a great path to success!
Building Your Dream... For over 30 years Custom On-Site Builders has provided the highest level of craftsmanship and homeowner satisfaction to Northern Colorado. We have built our reputation one outstanding home at a time, working with well established local subcontractors and suppliers. Our innovative designs and hands-on attention to detail ensures your home will be an expression of timeless beauty throughout the years. Whether you choose to build on our lot or yours, each home is designed, engineered and built by our team of professionals, using the best building materials Northern Colorado has to offer. We work closely with each homebuyer to build personalized spaces that reflect their vision and our commitment to excellence.
Custom On-Site Builders is devoted to building your dream.
970-776-9614 210 E 12th St. Loveland, CO
Water Valley IN WINDSOR
Amenity-Filled Living in a Scenic, Tranquil Location Water Valley is a 1,500-acre community surrounded by five manmade lakes and Pelican Lakes Golf Course. Water Valley features spacious single-family homes with multiple floor plans starting from the upper $300s. This community offers spectacular water views in a peaceful and relaxing location with an abundance of amenities. • Five large lakes with beaches for picnics, enclosed campfires, volleyball, lounging, long walks and more • Homesites backing to Pelican Lakes Golf Course • 7.5 Miles of recreational trails for jogging, biking, walking, birdwatching, tot-lots and more • Four miles to Interstate 25 with direct access to Downtown Denver and Fort Collins
Your stunning new CalAtlantic home embodies the spirit of Northern Colorado. Water Valley provides the perfect escape into the Northern Colorado outdoors.
Homes from the upper $300s Quick Move-in Homes Available Now Community conveniently located just south of Windsor.
Sales Center: 1925 Los Cabos Drive, Windsor, CO 80550
CalAtlanticHomes.com
CalAtlanticHomes.com
For more information on Water Valley, register online or call 970-460-7129.
No view is promised. Views may also be altered by subsequent development, construction and landscaping growth. Plans to build out this neighborhood as proposed are subject to change without notice. The date of actual completion could substantially differ from the estimated date. Persons in photos do not reflect racial preference and housing is open to all without regard to race, color, religion, sex, handicap, familial status or national origin. Prices, plans and terms are effective on the date of publication and subject to change without notice. CADEN134
K E Y PA RT N E R S
Paul Jansen Broker Associate
I thoroughly enjoy being a Realtor in Colorado. Work can be challenging, and the hours can be long, but the most rewarding part is when your clients become friends. If you have real estate needs, feel free to give me a call.
970.567.4757
Paul.Jansen@Color adoHomes.com | PJRealty.net
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