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By Kathie Shandro
The author has permitted the reprinting and redistribution of this article.


We pulled up in front of the bank-owned house. As the Denver real estate investor and I stepped from the car, we began taking notes. We were quick at assessing the condition of a Denver home, estimating the repairs necessary to flip it. This investor’s goal was 100% ROI, in & out within a four month window.


I rang the doorbell, knocked and called, hello. We walked through the living room, quickly taking notes. And then we stopped in the kitchen. The floor seemed to be collapsing. Actively collapsing.


As we surveyed the kitchen, we observed a group of men removing copper pipes. I don’t know the best practices for this procedure, but I’m convinced these guys hadn’t read the manual. The water level in the family room was rising.


They wanted to know what we were doing. Wanting to minimize risk, I said, We’re looking at homes to buy, but this one is too small. We really need a larger home. We began to back toward the front door. One member followed us out, walked us to my car. Things were a little tense.


We drove away – and immediately reported the incident. Concerned, my client quickly raised two critical questions


What clauses in the Colorado real estate contract protect the buyer if a vandalous act or other event changes the condition of the house he is under contract to purchase


And what would happen to his financial goals were a similar situation to occur after his purchase of a property


These are both excellent questions, and ones that your real estate broker should review with you, for your peace of mind.


The Colorado real estate contract establishes the process by which Casualty will be handled by parties to the contract. If the property suffers damage of less than 10% of the purchase price, the Seller is required to repair the damage before closing date. If the damage exceeds 10% of the purchase price, the contract may be terminated at the option of the buyer. If the Buyer elects to proceed with the purchase, the contract goes so far as to stipulate the transfer of insurance proceeds from Seller to Buyer. It also includes a clause defining the Buyer’s right to inspect and verify the condition of the property prior to closing.


If your investment interests would be better served by tightening these clauses, that may be done through additional provisions, as negotiated and accepted by the Seller.


The second question pertains to your homeowner’s insurance policy. When my clients write a policy with their insurance provider, I encourage them to pepper the insurance agent with “what if” questions. A good insurance agent takes a consultative approach to customer service, and strives to make sure that your real estate investments have adequate coverage to protect you against a variety of losses.


It is critical to your success as a Denver real estate investor that your position remains strong throughout the process of acquiring, repairing and selling your investment. I’ve only seen one instance of copper pipe removal, but you’re bound to face a variety of challenges along the way. Take a proactive step and surround yourself with professionals who will serve your financial interests from start to finish.
Kathie Shandro, GRI – REMAX Real Estate


If you would like to take advantage of the market and learn how to invest in real estate and you are local to the Dallas Fort Worth area, I know a really great teacher and mentor here in Arlington Texas. Please take a look at his web site:, Dennis has a great Mentoring and training program, I know because I am one of his former students. I learned a lot from his one on one teaching technique. – Michael Harman 817-457-7572>

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