Category: Mortgage

First-Time Home Buying Programs and Loans You Should Know​

Posted on by First Western Trust Bank

If you’re looking to buy your first home, you’re not alone—and you’re definitely not without help. Across the country, and especially in states like Colorado, Montana, Arizona, and Wyoming, a wide range of programs are designed to make homeownership more accessible. These include down payment assistance, favorable loan options, grants, and special incentives for veterans, essential workers, and low- to moderate-income households. 

Whether you’re worried about saving enough for a down payment or unsure how to qualify for a loan, this guide will walk you through the best tools and resources available to help you afford your first home. 

Why First-Time Buyers Get Extra Help 

First-time homebuyers often face unique financial hurdles. Between saving for a down payment, paying closing costs, and qualifying for a loan, the process can feel overwhelming—especially if you’re trying to do it all while managing rent and student debt. 

That’s why many programs exist specifically for people who’ve never owned a home or haven’t in several years. These programs can: 

  • Lower your required down payment: Some programs reduce the amount needed up front to as low as 0–3%, which can make homeownership more accessible without years of saving. 
  • Reduce your mortgage interest rate: Lower interest means lower monthly payments and less paid over the life of the loan, improving long-term affordability. 
  • Provide grants or low-interest loans for down payment and closing costs: These funds can bridge the gap between your savings and what’s needed to close the deal. 
  • Offer looser credit requirements: First-time buyer loans often have more forgiving credit thresholds, making it easier to qualify. 
  • Help you buy in areas where housing is more affordable: Certain programs are targeted toward specific neighborhoods or rural areas, where your buying power may go further. 

Conventional Loans with Low Down Payments 

Great for: Buyers with decent credit and stable income. 

Conventional loans are the most common type of mortgage—and some come with just a 3% down payment requirement: 

  • Conventional 97: Just 3% down, requires private mortgage insurance (PMI), and generally requires a credit score of 620 or higher. It’s a solid option for buyers with moderate income. 
  • HomeReady (Fannie Mae): Requires just 3% down and is designed for moderate-income buyers. It offers reduced PMI rates and flexible income requirements. 
  • Home Possible (Freddie Mac): Similar to HomeReady, this program supports first-time buyers with limited savings and allows co-borrowers who don’t live in the home. 
  • HomeOne: Exclusive to first-time buyers with 3% down, no income limits, and available for various property types. 
  • HFA Preferred/Advantage: Offered through state Housing Finance Agencies (HFAs), these programs offer affordable financing and are often paired with down payment assistance. 

Note: You’ll get these loans through approved lenders, not directly from Fannie Mae or Freddie Mac. 

Government-Backed Loans 

Best for: Buyers with lower credit scores or no down payment savings. 

These loans are insured by federal agencies, making them easier to qualify for. 

  • FHA Loan: Requires as little as 3.5% down with a credit score of 580 or higher. Great for buyers who need flexibility in credit and income. 
  • VA Loan: Offers zero down, no PMI, and competitive rates for eligible veterans, active-duty service members, and surviving spouses. 
  • USDA Loan: Offers 100% financing for homes in designated rural areas. Income limits apply, but it’s an excellent option for those who qualify. 

First-Time Buyer Help by State 

Colorado, Montana, Arizona & Wyoming all offer state-specific help. 

Each state operates a housing finance authority (HFA), which provides affordable mortgage options and down payment assistance: 

  • Colorado: CHFA loans include competitive interest rates, optional down payment assistance, and Mortgage Credit Certificates (MCCs) for ongoing tax savings. 
  • Montana: Montana Housing programs offer first-time buyer loans, 0% interest down payment loans, and options tailored for rural buyers. 
  • Arizona: Home Plus offers grants up to 5% of the loan amount, while the Pathway to Purchase program offers targeted assistance in specific cities. 
  • Wyoming: WCDA provides low-interest mortgage loans with optional down payment assistance, and education programs to prepare buyers. 

Find your state’s HFA website to browse offerings and requirements. 

Down Payment Assistance (DPA) Options 

Ideal for: Buyers who can afford monthly payments but struggle with upfront costs. 

Types of assistance: 

  • Grants: These are funds you don’t need to repay, often offered by local governments or nonprofits to help cover down payment and closing costs. 
  • Deferred Loans: These loans don’t require payment until you sell, refinance, or pay off your home. Often offered at 0% interest. 
  • Forgivable Loans: The loan is fully forgiven after a set period (usually 5–10 years) as long as you remain in the home. 
  • Matched Savings: Some programs match your down payment savings dollar-for-dollar, helping you reach your goal faster. 

Other Federal and Nonprofit Programs 

  • Good Neighbor Next Door: HUD offers a 50% discount on select homes for teachers, firefighters, EMTs, and law enforcement officers. 
  • HomePath ReadyBuyer: Get up to 3% closing cost assistance when buying a Fannie Mae foreclosure and completing a short online course. 
  • Energy Efficient Mortgages (EEMs): Add energy-saving improvements into your mortgage and save on future utility bills. 
  • Habitat for Humanity: Offers affordable homes to buyers willing to contribute sweat equity. Ideal for low-income individuals and families. 
  • NACA: Provides loans with no down payment, no closing costs, and no PMI. Qualification is based on financial behavior, not credit score. 

Loans for Fixer-Uppers 

If you’re open to renovations, an FHA 203(k) loan can cover the purchase price and repair costs. This lets you buy a lower-priced home that needs work and make improvements right away—without needing separate financing. 

Employer-Sponsored and Student Programs 

  • Employer-Assisted Housing (EAH): Some employers offer grants, forgivable loans, or closing cost assistance to help workers live near their jobs. 
  • Grads Programs: Recent graduates—typically within the past 48 months—may be eligible for down payment assistance or favorable loan terms. For example, Ohio offers Grants for Grads. 

Tax Benefits 

  • Mortgage Credit Certificates (MCCs): Offer a federal tax credit of up to $2,000 annually. Available through state HFAs and can reduce your tax bill directly. 
  • Mortgage Interest Deduction: Allows you to deduct interest on up to $750,000 in mortgage debt (or $375,000 if single), helping reduce taxable income. 

Questions to Ask Your Realtor or Lender 

  1. Do I qualify as a first-time homebuyer? Some programs consider you a first-time buyer even if you’ve owned a home in the past—if it’s been more than three years. 
  1. What local or state programs could I apply for? Your lender or real estate agent should know what’s available in your area. 
  1. Can I combine down payment assistance with a low-down-payment loan? Often yes—many programs are stackable, which can increase your purchasing power. 
  1. What are the upfront costs I need to prepare for? Understanding closing costs, inspections, and prepaid taxes is key to avoiding surprises. 
  1. Are there income or purchase price limits on the programs available? Many programs have caps—ask what limits apply and if you qualify. 

How to Get Started 

  1. Check your credit and work to improve it if needed. Good credit can unlock better loan terms. 
  1. Get pre-approved with a lender who works with first-time buyer programs. This helps you shop with confidence. 
  1. Research your state’s HFA website to see what assistance and loan programs are available. 
  1. Talk to your employer—some companies offer housing benefits or down payment assistance. 
  1. Work with a real estate agent who understands these programs and can guide you to qualifying homes. 

Final Thoughts 

Buying your first home is a major milestone—and with the right programs, it’s more within reach than ever. From state-backed loans to federal assistance and grants, first-time buyers have plenty of resources to lighten the financial load. Whether you’re in Colorado’s mountain towns, Montana’s open plains, Arizona’s desert suburbs, or Wyoming’s quiet communities, smart planning and the right loan can help you get the keys to your new home. 

Choose the Right Financing for Building Your New Home 

Posted on by First Western Trust Bank

Building your dream home is an exciting journey, but it starts with securing the right financing. Construction loans differ from traditional mortgages in several important ways, and understanding your options can help you make informed decisions, avoid costly missteps, and move forward with confidence. 

Discover the main types of construction financing available and key considerations to help you choose the loan that best supports your homebuilding goals. 

1. Construction Loans: 

Construction-to-Permanent (C2P) Loan: This popular option finances both the construction and the permanent mortgage, converting into a traditional mortgage once the home is complete.  

Pros: Single closing, potentially saving on closing costs. Interest-only payments during construction can ease the financial burden.  

Cons: Can be more expensive than traditional mortgages due to higher interest rates. 

This type of loan is ideal if you’re looking for a seamless transition from building to ownership. You’ll go through the application and approval process only once and won’t have to worry about requalifying when the home is complete. 

Stand-Alone Construction Loan: A short-term loan covering just the construction phase, requiring a separate mortgage to pay it off after completion.  

Pros: Flexibility to shop for the best permanent mortgage after construction.  

Cons: Two closings, potentially incurring higher overall costs. 

This option might be suitable if you’re unsure about your long-term financing strategy or believe better mortgage options will be available after construction. However, keep in mind that you’ll need to qualify for both loans separately. 

Owner-Builder Construction Loan: For those acting as their own general contractor, these loans require demonstrating construction experience and potentially licensing.  

Pros: Potential cost savings by eliminating a builder.  

Cons: More difficult to qualify for, as lenders prefer experienced contractors. 

If you have experience managing construction projects or holding a contractor’s license, this option can give you more control and reduce expenses. But it also involves more risk and administrative oversight. 

2. Government-Backed Construction Loans: 

FHA Construction Loans: Designed for borrowers with lower credit scores, offering a lower down payment (as low as 3.5% with a 580+ credit score).  

Options: Construction-to-permanent loan (one-time close) or FHA 203(k) loan (for renovation). This loan is accessible for first-time homebuyers or those with limited savings. It simplifies the financing process while providing flexibility to build or renovate. 

VA Construction Loans: For eligible military personnel and veterans, often requiring no down payment and offering potentially lower interest rates. VA construction loans are a powerful benefit for service members, offering favorable terms with minimal upfront costs. Borrowers must work with VA-approved builders and meet specific property requirements. 

USDA Construction Loans: For low-income households in rural areas, offering no down payment but requiring USDA-approved contractors and meeting income limits. Ideal for those planning to build in eligible rural communities, these loans promote affordable homeownership while requiring strict adherence to program guidelines. 

3. Other Financing Options: 

Lot Loans: For purchasing land before starting construction. If you’ve found the perfect piece of land but aren’t ready to build, a lot loan can help you secure the property now. You can often roll this into a future construction loan. 

Bridge Loans: Short-term loans to cover costs while selling a current home. Bridge loans can ease cash flow if you need to finance construction while awaiting proceeds from the sale of your existing home. These are best for buyers with solid equity and short-term borrowing needs. 

Renovation Loans: For upgrading an existing home based on its future value after renovation. If your dream home involves transforming an existing property, renovation loans let you finance improvements as part of your mortgage. These are helpful for buyers looking at fixer-uppers or outdated homes in great locations. 

Key Considerations When Choosing a Loan: 

Financial Situation: Assess your credit score, income, savings, and debt-to-income ratio to determine your eligibility and the types of loans you may qualify for. 

Project Size and Complexity: Larger or more customized projects may require more flexible financing. A one-size-fits-all approach doesn’t always work for complex builds. 

Building Experience: If acting as your own contractor, consider an owner-builder loan. However, be prepared to meet stringent lender requirements regarding construction knowledge and credentials. 

Desired Loan Term: Construction loans are typically short-term (6–18 months). Make sure to align your financing term with your projected construction timeline and the expected mortgage length afterward. 

Interest Rates and Fees: Compare both construction and permanent financing rates. Understand fee structures, including inspection, origination, and closing costs. 

Lender Specialization: Choose a lender with experience in construction financing. Specialized lenders can offer streamlined approvals, tailored guidance, and better problem-solving throughout the process. 

Important Notes: 

  • Construction loans typically require a higher credit score and down payment than traditional mortgages. 
  • Lenders will scrutinize your builder and construction plans, including budgets and timelines. 
  • Loan funds are disbursed in stages (draws), following inspections of construction progress. 
  • Interest-only payments are common during the construction phase, helping manage cash flow before the home is completed. 

Ultimately, the best financing option depends on your individual circumstances and project needs. Consult with a lender specializing in construction loans to discuss your options and determine the most suitable fit for your dream home. 

Finding the Right Lender 

Do your research: 
Compare offerings from banks, credit unions, and online lenders. Terms and rates can vary significantly, so gathering multiple quotes is essential. 

Work with a Mortgage Professional: 
A specialist in construction lending can help guide you through the process, explain options, and structure financing that aligns with your timeline and goals. 

Choosing the right financing strategy for your new home construction is just as important as selecting your architect or contractor. With the right knowledge and a well-informed plan, you can move forward with confidence, knowing that your home—and your financing—are built on a solid foundation. 

Disclaimer: First Western Trust is an Equal Housing Lender, NMLS #477166 

12 Questions to Ask a Home Inspector Before, During, and After a Home Inspection 

Posted on by First Western Trust Bank

If you’re buying or selling a home, the home inspection is a critical step toward understanding the property’s condition. The questions you ask—and when you ask them—can greatly impact how much insight you gain and how confidently you proceed. To help you navigate this important process, here are 12 essential questions to ask your home inspector before, during, and after the inspection, along with why they matter and the benefits they offer. 

Before the Inspection: Finding the Right Inspector and Setting Expectations 

Choosing the right home inspector and setting clear expectations can save you time, money, and stress later. These questions help you evaluate the inspector’s experience, thoroughness, and transparency: 

1. What exactly will you inspect? 
Knowing what areas and systems the inspector will review helps you understand the scope of the inspection. A detailed inspection covering major components—roof, foundation, plumbing, electrical, HVAC—ensures that no critical issues go unnoticed. Asking this question prepares you for what to expect and helps avoid surprises. 

Why Ask: You’ll gain confidence that your investment will be properly evaluated, giving you peace of mind about the home’s condition. 

2. What is NOT included in the inspection? 
Every inspection has limits. Inspectors generally perform visual, non-invasive checks and cannot open walls or conduct specialized testing. Understanding these boundaries lets you anticipate when additional expert inspections (roofers, electricians, plumbers) may be necessary. 

Why Ask: This helps you budget for potential extra inspections and prevents unrealistic expectations about what the home inspector can provide. 

3. How long have you been doing inspections and how many have you completed? 
Experience often translates into a more skilled and thorough inspection. Inspectors who have worked on many homes, especially those similar to the one you’re considering, will be better equipped to spot hidden problems and provide reliable advice. 

Why Ask: You reduce the risk of missing important issues and increase the likelihood of receiving a detailed, accurate report. 

4. Can I accompany you during the inspection? 
Being present during the inspection lets you see firsthand what the inspector finds and provides an opportunity to ask questions in real time. This interactive process enhances your understanding and allows you to clarify concerns on the spot. 

Why Ask: You’ll gain valuable knowledge about your potential home and avoid confusion or surprises when reviewing the written report later. 

5. Can you provide a sample inspection report? 
Reviewing a sample report ahead of time helps you understand the level of detail and the format you’ll receive. Some reports are straightforward, while others include photos, diagrams, and recommendations. 

Why Ask: Knowing what to expect from the report helps you prepare for interpreting the findings and facilitates clearer communication with your inspector. 

During the Inspection: Observing and Asking Clarifying Questions 

Attending the inspection is your chance to engage directly with the expert and gain deeper insight. These questions help you understand the home’s condition as issues arise: 

1. What does that mean? 
When the inspector points out a concern, ask for a clear explanation in simple terms. Understanding what a problem is and why it matters enables you to assess its impact. 

Why Ask: You avoid confusion and can better weigh repair costs or negotiation strategies with the seller. 

2. Is this a major problem or a minor issue? 
Not every defect is a deal breaker. This question helps you distinguish between problems that require immediate attention and those that are common or easily fixed. 

Why Ask: It helps prevent unnecessary worry and supports informed decision-making on whether to proceed or negotiate repairs. 

3. How do I maintain or care for these systems? 
Ask about upkeep for important systems like HVAC, plumbing, or electrical. Learning proper maintenance practices can extend the life of these components and avoid costly repairs. 

Why Ask: You’ll be better equipped to care for your home and protect your investment long term. 

4. What are your biggest concerns about this property? 
Request a summary of the most critical issues the inspector has identified. This helps you prioritize follow-up actions and focus your attention where it matters most. 

Why Ask: You’ll be prepared to address the most urgent problems, whether through negotiation, further expert evaluation, or budgeting for repairs. 

After the Inspection: Understanding the Report and Planning Next Steps 

Once you have the written report in hand, it’s important to review it carefully and clarify any uncertainties to make confident choices: 

1. Can you clarify anything in the report I don’t understand? 
Technical language and detailed findings can be confusing. Don’t hesitate to ask your inspector for further explanation to ensure you fully grasp the condition of the property. 

Why Ask: Clear understanding prevents misinterpretation and helps you make sound financial and homeownership decisions. 

2. Are there any issues serious enough to reconsider buying? 
Ask the inspector if any problems are so significant they should cause you to pause or reconsider the purchase. 

Why Ask: This helps you avoid costly surprises and ensures you are making a well-informed decision. 

3. Should I bring in specialists for further evaluation? 
If the inspector flags potential issues, inquire whether specialized inspections are recommended to assess repairs and costs more precisely. 

Why Ask: Bringing in experts like electricians or plumbers ensures you have accurate estimates and can negotiate effectively with sellers. 

Conclusion 

By asking the right questions before, during, and after your home inspection, you’ll gain a clear understanding of the property’s condition—empowering you to make confident, informed decisions. Taking a proactive approach helps safeguard your investment and minimizes the risk of costly surprises. 

Disclaimer: First Western Trust is an Equal Housing Lender, NMLS #477166 

Is a Fixed-Rate or Adjustable-Rate Mortgage Right for You?

Posted on by First Western Trust Bank

Choosing the right mortgage is one of the most important financial decisions you’ll make when buying a home. Two of the most common mortgage types are fixed-rate and adjustable-rate mortgages (ARMs). Each offers distinct advantages and potential risks, making it essential to understand how they work to select the best fit for your financial situation and long-term goals. 

Understanding Fixed-Rate Mortgages 

A fixed-rate mortgage features an interest rate that remains constant over the life of the loan. This means your monthly principal and interest payments will never change, providing a sense of stability and predictability. This loan type is often favored by homeowners planning to stay in their home for many years, as it allows for consistent budgeting without surprises from fluctuating interest rates. 

Fixed-rate mortgages come in various term lengths, with the 15-year and 30-year loans being the most popular. While the 15-year fixed-rate mortgage typically carries a lower interest rate and allows you to build equity faster, it comes with higher monthly payments. The 30-year fixed loan offers lower monthly payments but more interest paid over time. 

The primary benefit of a fixed-rate mortgage is the security it offers against rising interest rates. In a rising rate environment, homeowners with fixed loans are protected from increased payments. This can make long-term financial planning easier, especially for those with fixed or predictable incomes. 

What Are Adjustable-Rate Mortgages (ARMs)? 

Adjustable-rate mortgages start with a fixed interest rate for an initial period — commonly 3, 5, 7, or 10 years — after which the rate adjusts periodically based on a benchmark index plus a margin. These adjustments occur annually or semi-annually depending on the loan terms. 

The key appeal of ARMs is the typically lower initial interest rate compared to fixed-rate mortgages, which can result in lower monthly payments early on. For borrowers who expect to move, refinance, or see a significant increase in income within the initial fixed period, ARMs can offer substantial savings. 

However, the trade-off is the uncertainty of future payments. Once the fixed period ends, your interest rate and payments may increase or decrease depending on market conditions. If rates rise significantly, monthly payments can become substantially higher, potentially impacting your budget. 

Comparing Fixed-Rate and Adjustable-Rate Mortgages 

When deciding between fixed and adjustable rates, consider your personal financial goals, risk tolerance, and how long you plan to stay in the home. 

  • Stability vs. Flexibility: Fixed-rate mortgages provide payment stability and predictable budgeting. ARMs offer lower initial payments and can be more flexible, but come with uncertainty about future rates. 
  • Duration of Homeownership: If you plan to own your home long-term, a fixed-rate loan may provide greater peace of mind. If you anticipate moving within a few years, an ARM’s lower initial rate may save you money. 
  • Market Conditions: In a low-interest-rate environment, locking in a fixed rate may be beneficial. When rates are higher but expected to decline, an ARM might be advantageous. 
  • Income and Budget: Stable or fixed income borrowers often prefer fixed-rate loans for consistent payments. Borrowers with variable income or expecting future earnings growth might choose an ARM to capitalize on lower initial costs. 

How First Western Trust Mortgage Can Help 

Navigating mortgage options can be complex, particularly when balancing short-term affordability with long-term financial strategy. At First Western Trust, we work closely with each client to understand their unique circumstances and goals. We provide clear explanations of mortgage products and their potential impact on your financial future. 

Whether you are leaning toward the stability of a fixed-rate mortgage or the flexibility of an adjustable-rate mortgage, we can guide you through the process, ensuring you choose the right solution. Our team leverages deep industry knowledge and a commitment to personalized service to support your home financing journey. 

Final Thoughts 

Choosing between a fixed-rate and adjustable-rate mortgage requires careful consideration of your financial situation, goals, and market factors. Fixed-rate mortgages offer predictability and protection against rising interest rates, while ARMs provide potential savings and flexibility but carry more risk. 

Understanding these differences and how they relate to your needs will empower you to make an informed decision. Partnering with an experienced lender like First Western Trust Mortgage ensures you receive the guidance and support necessary to select a mortgage that fits your lifestyle and financial plans. 

Disclaimer: Personal banking services offered through First Western Trust Bank, Member FDIC  

First Western Trust is an Equal Housing Lender, NMLS #477166 

This content is for informational purposes only and does not constitute legal or tax advice. Please consult your legal or tax advisor for specific guidance tailored to your situation. First Western Trust Bank cannot provide tax advice. Please consult your tax advisor for guidance on how the information contained within may apply to your specific situation.  

Building an ADU for Aging Parents: Comfort, Care, and Independence

Posted on by First Western Trust Bank

As more families seek practical solutions to support aging parents, building an Accessory Dwelling Unit (ADU) has emerged as an increasingly popular option. An ADU is a secondary housing unit on a single-family property — often a converted garage, basement, or a small separate structure. For families, an ADU can provide a comfortable, private space for elderly parents while keeping them close to loved ones. This arrangement offers a unique balance between independence and care, making it a thoughtful alternative to traditional eldercare facilities. 

Why Consider an ADU for Aging Parents? 

Rising costs of assisted living and in-home care have made many families reconsider how best to support their elderly loved ones. An ADU enables parents to retain a degree of autonomy, reducing the emotional challenges that come with relocating to a care facility or moving in with family members in shared spaces. It also allows adult children to be nearby for support, offering peace of mind and easier access to care without sacrificing privacy. 

The proximity encourages family connection and helps foster a comfortable living environment tailored to the parent’s needs. Additionally, an ADU can increase property value and offer future flexibility — for example, as a rental unit or guest house — making it a sound investment for the long term. 

Zoning and Permitting Considerations 

Before starting construction, it’s essential to understand local zoning laws and permitting requirements. Regulations vary widely by city and county, with some areas having strict size limits, design standards, and occupancy rules for ADUs. Many municipalities have recently relaxed restrictions to encourage ADU development, but due diligence is key to ensuring your project is compliant. 

It’s advisable to consult with local planning departments or hire professionals familiar with your jurisdiction’s ADU regulations. Understanding setback requirements, parking rules, and allowable square footage can save time and costs during the permitting process. 

Construction Costs and Design Options 

The cost of building an ADU depends on factors like size, location, design complexity, and materials. On average, constructing a detached ADU can range from $100,000 to $300,000 or more, while converting existing spaces such as garages or basements can be more affordable alternatives. 

Design choices should focus on accessibility and safety to meet aging parents’ needs. Features such as single-level layouts, wider doorways, no-step entrances, grab bars, and non-slip flooring improve comfort and reduce fall risks. Incorporating energy-efficient appliances and fixtures can also lower utility costs and increase sustainability. 

Many families choose a custom design tailored to their loved one’s preferences and medical needs, while others opt for modular or prefab ADUs that offer quicker construction timelines and potentially lower costs. 

Financing Your ADU Project 

Financing an ADU can be a significant concern, but several options are available. Traditional mortgage loans may allow homeowners to include an ADU construction or renovation as part of a home equity line of credit (HELOC) or a cash-out refinance. Some lenders offer specialized loans designed for ADU construction, recognizing the growing demand for these projects. 

Working with a bank or financial institution experienced in flexible lending options can help you find the right solution that fits your budget and long-term financial goals. Some programs also offer favorable terms for energy-efficient or accessible design improvements. 

Emotional and Financial Benefits 

Beyond practicality, building an ADU fosters emotional well-being for both aging parents and their families. Parents maintain independence and dignity, living in their own space, while children benefit from the reassurance that help is close by. This arrangement can reduce caregiver stress and improve quality of life across generations. 

Financially, an ADU can offset some elder care expenses by reducing the need for costly assisted living or round-the-clock in-home care. Additionally, the added living space increases property value and creates a potential rental income source if parents no longer require the unit. 

Long-Term Planning and Quality of Life 

Building an ADU is more than just adding a physical structure — it’s about creating a sustainable, compassionate living solution that supports aging with grace and dignity. Families should consider future needs and possible changes in health status, designing a space that can adapt to evolving requirements. 

Consulting with healthcare professionals, financial advisors, and housing experts ensures a comprehensive approach that balances comfort, care, and independence. Taking the time to plan carefully results in a home environment that enriches relationships and provides security for years to come. 

Partnering with First Western Trust Mortgage

For families considering an ADU, First Western Trust offers personalized financial guidance and lending solutions tailored to these unique projects. With experience serving clients who have complex financial situations and a commitment to thoughtful planning, First Western Trust can help you navigate financing options that make building an ADU feasible and affordable. 

Whether exploring home equity financing or specialized loans for ADU construction, partnering with a trusted bank provides the expertise and support to bring your vision to life — ensuring your parents enjoy comfort, connection, and independence in their golden years. 

7 Key Steps to Take After Finding Your Dream Home

Posted on by First Western Trust Bank

Finding your dream home is an exciting milestone. But once that emotional “yes” is out of the way, there’s a series of practical steps you need to follow before you can truly settle in. By tackling each of these key actions in a structured way, you’ll avoid last‑minute surprises, protect your investment, and ensure a smooth closing and move‑in process. Here are the seven critical steps to take once you’ve found—and put an offer on—your future home.

1. Secure and Confirm Your Financing

Even if you’ve been pre‑approved for a mortgage, it’s vital to reconfirm your loan details now that you have a specific property in sight:

  • Lock in Your Interest Rate: Mortgage rates can fluctuate daily. Ask your lender to lock in the rate to protect you from market volatility between now and closing.
  • Review Loan Terms: Examine your loan’s amortization schedule, closing costs, and any prepayment penalties. Ensure you understand exactly what you’ll pay each month, and for how long.
  • Submit Additional Documentation: The lender may request updated bank statements, pay stubs, or tax returns based on the home’s purchase price. Respond quickly to avoid delays in underwriting.

Securing your financing not only gives you peace of mind but also demonstrates to the seller that you’re a committed buyer.

2. Schedule a Thorough Home Inspection

A professional home inspection is your best defense against hidden problems:

  • Hire a Reputable Inspector: Choose someone certified through a recognized organization (e.g., ASHI or InterNACHI).
  • Attend the Inspection: Walk through the property with the inspector to learn firsthand about potential issues with the foundation, roof, HVAC, plumbing, or electrical systems.
  • Review the Inspection Report: Expect a detailed report with photos, cost estimates for recommended repairs, and notes on safety concerns or code violations.

This step helps you make an informed decision about proceeding with the purchase or negotiating repairs.

3. Negotiate Repairs and Seller Concessions

Once you have the inspection report in hand, you can approach the seller with confidence:

  • Prioritize Repairs: Focus on major structural or safety issues (e.g., mold, water damage, faulty wiring). Minor cosmetic fixes can often be handled after closing.
  • Request Credits or Price Reductions: Instead of asking the seller to complete repairs, you might negotiate a credit at closing, giving you the flexibility to choose your own contractor.
  • Set Clear Deadlines: Include language in the purchase agreement that specifies a timeframe for the seller’s response and completion of agreed repairs or credits.

A well‑negotiated deal ensures you won’t be hit with unexpected expenses after you move in.

4. Finalize Homeowners Insurance and Protect Your Investment

Lenders require proof of insurance before funding your mortgage, but homeowners insurance offers benefits beyond satisfying loan requirements:

  • Shop for Coverage: Compare policies for dwelling coverage, personal property protection, and liability limits. Look for endorsements that cover flood or earthquake risk if you live in vulnerable areas.
  • Set an Effective Date: Schedule your policy to begin on the day of closing so there’s no coverage gap.
  • Review Deductibles and Premiums: Higher deductibles lower premiums but increase out‑of‑pocket costs for claims. Balance your risk tolerance with your budget.

Insurance safeguards you against fire, theft, and liability, making it a non‑negotiable step before taking ownership.

5. Review Homeowners Association (HOA) Rules and Fees

If your new home is part of an HOA or condo association, take time to understand your obligations:

  • Obtain Governing Documents: Review the CC&Rs, bylaws, and any amendments to understand restrictions, maintenance responsibilities, and architectural guidelines.
  • Confirm Dues and Special Assessments: Know the monthly or annual fees, what they cover, and any pending special assessments that could affect your budget.
  • Attend an HOA Meeting: If possible, attend a board meeting or speak with current residents to get a sense of community dynamics and upcoming projects.

Familiarizing yourself with HOA rules early prevents surprises later, from exterior paint restrictions to landscaping requirements.

6. Conduct a Final Walk‑Through

A final walk‑through typically takes place 24–48 hours before closing to verify the home’s condition:

  • Check Repair Completion: Ensure all agreed repairs have been made to your satisfaction.
  • Test Systems and Appliances: Turn on HVAC, run water through faucets, flush toilets, and test appliances to confirm they’re operational.
  • Verify Cleanliness and Inclusions: Confirm the home is broom‑clean and that fixtures, window treatments, or appliances specified in the contract remain.

This step lets you address last‑minute issues with the seller before you sign the final documents.

7. Prepare for Closing and Move‑In

With inspections, financing, and insurance in place, turn your attention to the practicalities of closing and moving:

  • Organize Closing Documents: Bring identification, proof of funds for closing costs, and any documents your escrow officer requests.
  • Hire Movers or Rent Equipment: Book a reputable moving company early or reserve a truck and supplies if you plan a DIY move.
  • Change Your Address and Set Up Utilities: Notify the post office, transfer utilities (electric, water, gas, internet), and forward any subscriptions or billing addresses.

By tackling these tasks in advance, you’ll reduce stress on closing day and be ready to enjoy your new home immediately.

Conclusion

Finding your dream home is just the beginning of an exciting journey. By following these seven key steps—securing financing, scheduling inspections, negotiating repairs, finalizing insurance, understanding HOA rules, performing a final walk‑through, and preparing for closing—you’ll protect your investment and ensure a smooth transition. A methodical approach lets you focus on the joy of homeownership while minimizing unforeseen hurdles. Congratulations on your new home, and here’s to many happy years in your dream space!

What You Need to Know Before You Buy A House This Spring

Posted on by First Western Trust Bank

Spring is often considered the peak season for real estate, and many potential homebuyers are ready to jump into the market. With more homes on the market, warmer weather, and a sense of new beginnings, it’s easy to get excited about finding your dream home. However, purchasing a home is a significant financial decision, and it’s important to be well-prepared before you dive in. From assessing your budget to understanding current market conditions, here’s what you need to know before buying a house this spring.

1. Assess Your Budget and Understand What You Can Afford

Before you even begin your home search, it’s crucial to assess your financial situation. Understanding your budget will help ensure that you are looking at homes that are within your financial reach. Start by reviewing your monthly income, expenses, and debts to get a clear picture of your financial standing.

Consider how much you can comfortably afford to pay for a mortgage each month, keeping in mind other homeownership expenses such as property taxes, insurance, utilities, and maintenance costs. A good rule of thumb is that your monthly housing costs should not exceed 28-30% of your gross monthly income. Additionally, take into account your savings for a down payment—typically between 3% to 20% of the home’s price, depending on the loan type.

2. Get Pre-Approved for a Mortgage

One of the most important steps to take before starting your home search is getting pre-approved for a mortgage. Pre-approval involves a lender reviewing your financial information, including your credit score, income, and debt, to determine how much they are willing to lend you. This process will give you a clearer understanding of your purchasing power and help you avoid wasting time looking at homes that are out of your budget.

A pre-approval letter also shows sellers that you are a serious and qualified buyer, which can be a big advantage in a competitive market like spring. Sellers are more likely to consider offers from buyers who are pre-approved, knowing that these buyers are financially capable of closing the deal. Keep in mind that pre-approval is different from pre-qualification—pre-qualification is an estimate of how much you can afford based on the information you provide, while pre-approval is a more formal process with a thorough review of your financials.

3. Understand Current Market Conditions

The real estate market can vary greatly depending on location, so it’s essential to understand the current conditions in your area before making a decision. Spring tends to be a popular time for home buying, and as a result, inventory can be limited, leading to more competition and potentially higher prices. In a seller’s market, where demand exceeds supply, you may need to act quickly and be prepared for bidding wars.

Interest rates also play a key role in the housing market. While rates can fluctuate, they significantly impact your monthly mortgage payments and the overall cost of the home. If rates are low, it may be a good time to buy, as you can lock in a more favorable rate and save money over the life of the loan. On the other hand, if rates are higher, it may be worth weighing the pros and cons of waiting or exploring different loan options to ensure you get the best deal.

In addition to interest rates, consider the long-term outlook of the market. Are home prices expected to continue rising, or is there potential for a slowdown? Having a good understanding of the market trends in your area can help you make a more informed decision about when to buy and how much to offer on a home.

4. Work with a Trusted Mortgage Advisor

Navigating the mortgage process can be complex, and working with a trusted mortgage advisor is essential to ensure you find the right loan options for your situation. A mortgage advisor can guide you through the different loan types, such as conventional loans, FHA loans, and VA loans, and help you understand the pros and cons of each. They will also be able to explain terms such as interest rates, loan terms, and down payment requirements, allowing you to make an informed decision.

A good mortgage advisor will work closely with you to find the best loan options that fit your budget and financial goals. They can also help you understand any additional fees or costs associated with obtaining a mortgage, such as closing costs, appraisal fees, and mortgage insurance. Their expertise will not only ensure that you secure the best financing option but also help make the entire process smoother and less stressful.

5. Get Your Documents Ready

The mortgage application process requires a significant amount of paperwork, and having everything ready in advance will help streamline the process. Gather documents such as your tax returns, pay stubs, bank statements, and proof of assets. Your lender will also likely request information about your debts, such as credit card balances, student loans, and car loans. The more organized you are upfront, the faster and easier the approval process will be.

Having your documents prepared can also help you avoid delays, which is crucial in a competitive market. If you’re ready to submit everything quickly, you’ll be able to move forward with your home search without unnecessary hold-ups.

Conclusion

Purchasing a home this spring is an exciting opportunity, but it’s important to be well-prepared before you begin your search. By assessing your budget, getting pre-approved for a mortgage, understanding market conditions, and working with a trusted mortgage advisor, you can set yourself up for success in a competitive market. With the right preparation and guidance, you’ll be better equipped to make informed decisions and secure the home of your dreams. Make sure you take the necessary steps before you begin the home-buying process to ensure a smooth and successful experience.

Disclaimer: First Western Trust is an Equal Housing Lender, NMLS #477166

Spring Selling Tips for Homeowners

Posted on by First Western Trust Bank

Spring is one of the busiest seasons for the housing market, making it an ideal time for homeowners looking to sell. Buyers are eager to find their next home as the weather improves, and properties tend to show their best in the springtime. To make the most of this competitive market, homeowners should focus on strategic preparation, curb appeal, and understanding the financial aspects of selling and buying simultaneously.

Enhance Curb Appeal to Make a Strong First Impression

First impressions matter, and curb appeal plays a crucial role in attracting buyers. Consider these steps to make your home stand out:

  • Refresh Landscaping: Trim overgrown bushes, plant seasonal flowers, and maintain a healthy lawn.
  • Clean and Paint the Exterior: Power wash siding and driveways, and touch up any chipped paint.
  • Update the Front Door: A fresh coat of paint and new hardware can make a big impact.
  • Add Welcoming Touches: Place a new doormat and potted plants near the entrance.

Stage Your Home to Appeal to Buyers

A well-staged home can help buyers envision themselves living there. Here’s how to create a welcoming and attractive space:

  • Declutter and Depersonalize: Remove personal items and excess furniture to make spaces appear larger.
  • Deep Clean: Ensure every room is spotless, including windows, carpets, and kitchens.
  • Let in Natural Light: Open curtains and blinds to brighten rooms and highlight features.
  • Make Minor Repairs: Fix leaky faucets, squeaky doors, and chipped tiles to present a well-maintained home.

Price Your Home Competitively

Setting the right price is key to attracting buyers and securing a successful sale. Consider these factors:

  • Analyze Market Trends: Research comparable home sales in your neighborhood.
  • Work with a Real Estate Professional: An agent can help determine a competitive price.
  • Be Prepared to Adjust: If your home doesn’t receive interest, consider strategic price reductions.

Timing Your Sale for Maximum Impact

Spring brings an influx of buyers, making it essential to time your sale correctly:

  • List Early in the Season: More buyers enter the market in early spring, increasing demand.
  • Be Ready for Quick Offers: Homes sell faster in spring, so have a plan for your next move.
  • Leverage Peak Market Conditions: Take advantage of strong buyer interest to negotiate favorable terms.

Navigating the Transition from Selling to Buying

Selling your home and purchasing another requires careful financial planning. From a mortgage perspective, consider the following:

  • Understand Your Financing Options: Speak with a mortgage lender to explore loan pre-approval and financing for your next home.
  • Coordinate Closing Dates: Work with your agent and lender to align selling and buying timelines.
  • Consider Bridge Loans: If you need funds for your next purchase before your current home sells, a bridge loan may be a solution.

Ensure a Smooth Selling Process

By taking these steps, homeowners can position themselves for a successful spring sale. Preparing your home, setting a competitive price, and understanding mortgage options will help ensure a seamless transition to your next property. With the right approach, you can maximize your home’s value and enjoy a smooth move into your next home.

Disclaimer: Investment products and services are not a deposit, are not FDIC- insured, are not insured by any federal government agency, are not guaranteed by the bank and may go down in value.

First Western Trust is an Equal Housing Lender, NMLS #477166.

The Guide to Paying Off Your Mortgage Early

Posted on by First Western Trust Bank

Owning your home outright is a financial dream for many, and paying off your mortgage early can help make that dream a reality. It can save you thousands in interest, free up your budget, and bring a sense of financial freedom. But how do you balance this goal with other priorities like saving for retirement or building an emergency fund? Here’s your ultimate guide to making an early mortgage payoff work for you.

Why Pay Off Your Mortgage Early?

  1. Save on Interest
    The longer you hold a mortgage, the more interest you pay—especially with a 30-year loan. Early payoff significantly reduces the amount you’ll pay over the life of the loan.
  2. Achieve Financial Freedom
    A mortgage-free home means fewer monthly obligations, allowing you to allocate funds to other goals or enjoy a stress-free retirement.
  3. Build Equity Faster
    Paying down your mortgage early increases your home equity, which can be a valuable financial safety net if you ever need to access it.
  4. Peace of Mind
    Eliminating a major debt provides emotional relief and financial stability, especially during uncertain economic times.

Strategies to Pay Off Your Mortgage Early

  1. Biweekly Payments
    Instead of making one monthly payment, divide your monthly amount in half and pay that every two weeks. This results in 26 half-payments—or 13 full payments—a year, effectively shaving years off your loan term.
  2. Extra Principal Payments
    Add extra money to your principal whenever possible. Even small amounts—like rounding up your monthly payment—can make a big difference over time. For example, applying an extra $100 each month to a 30-year mortgage could save you tens of thousands in interest.
  3. Lump-Sum Payments
    Use windfalls like bonuses, tax refunds, or inheritance money to make large principal payments. Just ensure your mortgage doesn’t have prepayment penalties.
  4. Refinance to a Shorter Term
    Refinancing to a 15- or 20-year mortgage often comes with lower interest rates and forces you to pay off the loan faster. Keep in mind that your monthly payments will likely increase.
  5. Reduce Expenses and Redirect Savings
    Cutting back on discretionary spending or finding ways to increase income can free up funds to put toward your mortgage.
  6. Automate Your Payments
    Set up automatic payments to ensure you stay consistent with your payoff strategy.

Balancing Payoff Goals with Other Financial Priorities

Paying off your mortgage early is a worthwhile goal, but it’s important to ensure it doesn’t come at the expense of other financial needs:

  • Emergency Fund: Before prioritizing extra payments, make sure you have 3-6 months’ worth of expenses saved for emergencies.
  • Retirement Savings: Don’t sacrifice your long-term financial security. Contribute enough to retirement accounts to take full advantage of employer matches and compound growth.
  • High-Interest Debt: Pay off credit cards or personal loans with higher interest rates before focusing on your mortgage.

A balanced approach allows you to enjoy the benefits of paying off your mortgage early while safeguarding your overall financial health.

How First Western Trust Can Help

At First Western Trust, we believe in empowering you to achieve your financial goals, including paying off your mortgage early. Here’s how we can assist:

  • Customized Planning: Our advisors can evaluate your financial situation and develop a strategy to balance early mortgage payoff with other priorities.
  • Refinancing Options: We offer tailored refinancing solutions to help you secure a shorter term or lower interest rate.
  • Guidance on Prepayment Penalties: We’ll help you understand the terms of your mortgage and avoid penalties that could negate your savings.

Our team is here to provide the tools and expertise you need to make informed decisions and move closer to financial freedom.

Final Thoughts

Paying off your mortgage early is an achievable goal with the right strategy. Whether it’s biweekly payments, refinancing, or using windfalls wisely, small actions can lead to big results. Just remember to balance this goal with other financial commitments to ensure you’re building a stable and secure future.

Ready to take control of your mortgage? Contact us today to start planning your path to a mortgage-free life. Together, we’ll help you create a plan that fits your needs and accelerates your journey to financial independence.

9 Common Mortgage Mistakes and How to Avoid Them

Posted on by First Western Trust Bank

Buying a home or refinancing your mortgage is one of the most significant financial decisions you’ll make. Yet, it’s easy to stumble into pitfalls that can cost you time, money, and peace of mind. Here are 10 common mortgage mistakes—and how you can avoid them with confidence.

1. Skipping Professional Guidance

The Mistake: Navigating the mortgage process alone can lead to oversights or misunderstandings.
The Fix: Work with a trusted lender or mortgage advisor who can guide you through the complexities and answer your questions.

2. Overlooking Total Loan Costs

The Mistake: Focusing solely on the interest rate and ignoring other costs like closing fees, points, and mortgage insurance.
The Fix: Compare the annual percentage rate (APR), which factors in both the interest rate and fees, to get a more accurate picture of your loan’s cost.

3. Misunderstanding Loan Terms

The Mistake: Borrowers often don’t fully grasp whether their loan is fixed-rate or adjustable, or how an ARM might reset.
The Fix: Ask your lender for a detailed explanation of your loan’s terms, especially how payments may change over time.

4. Ignoring Your Credit Score

The Mistake: Applying for a mortgage with a low credit score can result in higher interest rates or even loan denial.
The Fix: Review your credit report before applying and work to improve your score by paying down debts and disputing any inaccuracies.

5. Taking on Too Much Debt Before Closing

The Mistake: Opening new credit cards or financing large purchases while your loan is in process can disrupt your debt-to-income (DTI) ratio.
The Fix: Avoid significant financial changes or new debts until after your loan has closed.

6. Skipping Pre-Approval

The Mistake: House-hunting without knowing what you can afford can lead to disappointment or overcommitting financially.
The Fix: Get pre-approved for a mortgage to understand your budget and make offers with confidence.

7. Not Factoring in All Homeownership Costs

The Mistake: Many buyers only consider their monthly mortgage payment, overlooking taxes, insurance, maintenance, and HOA fees.
The Fix: Use a mortgage calculator that includes these costs to determine your true monthly obligations.

8. Failing to Lock in Your Rate

The Mistake: Waiting too long to lock your interest rate can backfire if rates suddenly rise.
The Fix: Work with your lender to lock in a favorable rate when the market conditions are advantageous.

9. Overextending Your Budget

The Mistake: Stretching to afford the maximum loan amount approved by your lender can leave little room for unexpected expenses.
The Fix: Choose a loan amount that fits comfortably within your budget and leaves room for savings.

How to Avoid These Mistakes with Confidence

Making informed decisions during the mortgage process doesn’t have to be overwhelming. Here’s how to ensure you stay on track:

  • Ask Questions: Don’t hesitate to ask for clarification on anything you don’t understand.
  • Do Your Homework: Research different loan types, rates, and terms before committing.
  • Stay Organized: Keep track of deadlines and required documents to avoid delays.

How First Western Trust Can Help

At First Western Trust, we know the mortgage process can feel complex. That’s why we offer personalized support to help you navigate every step with confidence. Our experienced team works closely with you to:

  • Explain loan options and terms in plain language.
  • Help you compare rates and costs to find the best fit.
  • Guide you through pre-approval and rate lock decisions.
  • Provide expert advice to avoid common pitfalls.

With our proactive approach, you can trust that no detail will be overlooked, helping you secure a mortgage that aligns with your goals and financial well-being.

Final Thoughts

Avoiding common mortgage mistakes starts with being informed and working with the right partner. By steering clear of these pitfalls, you can simplify the process, save money, and approach homeownership with confidence.

Ready to take the next step? Contact us today for expert guidance and tailored mortgage solutions that put your goals first.