Real Estate Finance
Colorado's structure
Colorado borrowers sign a promissory note (the promise to pay) and a deed of trust (the security instrument) naming a public trustee rather than a mortgage. Colorado is a lien-theory state; the lender's remedy is foreclosure through the public trustee, with a court order under Rule 120 when the borrower contests, and generally no post-sale redemption in residential cases.
Loan basics
Know conventional, FHA (mortgage insurance premium), VA (guaranty, no monthly MI), USDA, and CHFA programs for Colorado buyers. Core math: LTV = loan ÷ value; a point is 1% of the loan amount; discount points buy down the rate; impounds collect taxes and insurance monthly. TRID Loan Estimate and Closing Disclosure timing rules govern most consumer mortgages, and RESPA bars referral kickbacks.
Traps: quoting a payment with no taxes, insurance, or mortgage insurance; confusing an assumable FHA loan with a conventional due-on-sale clause; forgetting that foreclosing a first deed of trust wipes out junior liens but not the reverse; treating pre-approval as a guarantee.
Worked example: $400,000 price, 10% down = $40,000 down, so the loan is $360,000. LTV = $360,000 ÷ $400,000 = 90%. Two discount points cost 2% × $360,000 = $7,200, paid at closing. Monthly interest at 6% = $360,000 × 0.06 ÷ 12 = $1,800 before principal.