Lehigh Valley Real Estate Blog, Home Buying & Selling Information

Lehigh Valley Mortgage Costs and PMI

A lot of questions come up involving different mortgage plans used to finance a house. Depending on your financial situation (and credit score) different options may be available.

The old standard of financing was 80% of the home value. In other words, a mortgage would be taken for 80% of the home value and at closing you would provide the other 20% plus closing costs. On average, about 25% of the value of the house would be needed in order to purchase the house. So, in order to purchase a $200,000 dollar house you would need $50,000.

Since most Lehigh Valley Home Buyers don't have 25% of the purchase price of the house, different mortgage options are available.

If your credit is good enough, a home mortage for 100% of the purchase price can be obtained. Since this involves financing over 80% of the house, your monthly payment will have a PMI charge (principle and mortgage insurance). PMI is an insurance you pay for every month to guarantee your loan. It is dependent on the purchase price of the house and can be a few hundred dollars added to your monthly mortgage payment.

To get around paying PMI on your Lehigh Valley home every month, a couple of different mortgage options are common. You can get an 80/15/5 mortgage, 80/10/10 mortgage or an 80/20 mortgage.

An 80/15/5 mortgage means that you will get two mortgages; one for 80% and another for 15%. You will provide the other 5% plus closing costs.

An 80/10/10 mortgage means that you will get two mortgages; one for 80% and another for 10%. You will provide the other 10% plus closing costs.

An 80/20 mortgage also means two mortgages. In this situation, all you have to pay at closing is the actual closing costs. In some situations, sellers assist (sellers concession) is obtained so that you don't have to pay anything for the house.

Having said that, typically you need to have at least a few thousand available to purchase a house. It is hard to finance or get the seller to pay for everything.

When you obtain two mortgages, the main mortgage, the one for 80%, usually has a decent interest rate. The interest rate on the second mortgage can be high. I have seen cases from 9% to 12%. These rates are commonly dependent on your credit score. The better the credit the better the rate.

A good mortgage representative (if you need one, contact me) can give you a GFE (Good Faith Estimate) for all of the different scenarios available. Then you can select the plan that works best for your situation.

Lehigh Valley - Home for Sale in Forks Township

Beautiful center hall colonial with tiled foyer and French doors into the DR with HW flooring, crown molding, and chair rail. The LR has HW floors, crown molding and French doors that lead into the FR with a brick gas FP, ceiling fan, and cathedral ceiling. Large kitchen includes a breakfast nook with access to the deck, large center island, maple cabinets and tiled backsplash. Tiled laundry rm w/deep sink plus a tiled 1/2 bath with cultured marble. HW stairs and hallway lead to the 4 BRs (all with ceiling fans). MBR has HW flooring, walk-in closet and 2nd closet. MBA has tiled floor and dual cultured marble sinks. Large unfinished rm (insulated) can be an office, media rm or 5th BR. Large basement with 3 daylight windows and stairs to the 2 car garage with extended area plus door to the back yard. A patio in the front, 2x6 construction, dual zone gas baseboard heat and separate central air complete this house. Easy access to the walking path that leads to the Forks Twp Municipal Park

Visit Lehigh Valley Homes Online for more information.

Lehigh Valley - Home Seller Aggression

In the past few months, I have attended a couple of closings in which we had to separate the buyers and the sellers. I am seeing more and more situations where the seller digs in their heels, to the point of being nasty and lying, because they don't want to fulfill their end of the agreement.

Some of the problems were:

Sellers removing items that should have remained in the house
Sellers not doing repairs they agreed to
Sellers leaving trash and not cleaning the premises before closing

I could write a book on problems I have run into in the past few months.

The common denominator in each situation was that the seller was not getting the money they expected to get for their property. They felt they had "given" enough with the lower price or the initial demands of the contract.Why should they give anymore? Who cares what the contract says?

Some of this is the result of home sellers still believing they can get more for their house then the market is willing to pay for it. Therefore, when the "home buyer" makes an offer that is less than the asking price the seller feels they have already given x amount of dollars to the buyer.

Having said that, the home buyers aren't helping since their demands are increasing and in some situations they make totally ridiculous offers with lots of demands on the seller. The home seller feels like they are getting slapped in the face.

Then, if the transaction proceeds, there are already negative feelings due to the initial offer. If things get tough towards the end, the buyers and the sellers may both dig in their heels and major problems occur.

Hopefully, the buyers agent and sellers agent can work things out but sometimes a happy medium can't be reached.

NY Style Deli - Commercial Property for Sale in Palmer Township

NY Style Deli for sale! Lots of room for growth!

Completely refurbished commercial property located on major artery in Palmer Township. Extensive menu plus a new kitchen with state-of-the-art equipment. Mainly a take-out/catering business.

View this listing on LoopNet (Commercial listing website)!