Lehigh Valley Real Estate Blog, Home Buying & Selling Information

Buying a Home in Lehigh Valley with Well Water

As a Lehigh Valley Home Buyer pursues a home, they may be interested in one that has Well Water as the water source (versus public water).

There are many homes in the Lehigh Valley that have a Well as the source of the Water for a home. The further you go from the major cities (Allentown, Bethlehem, Easton) the more prominent Wells become as the on-site water source. 

Having a Well for your water source may not be a bad thing. It is possible that the water may actually be better than public water.

When you purchase a home with a well, the PA Agreement of Sale has a contingency a buyer can elect to have the water tested. This option and the purchase should be contingent on testing of the water.

Some concerns with a Well:

Is the water potable (drinkable)?

Has the Well ever run dry?

How deep is the well?

How old is the pump?

How old is the ballister tank (typically in the basement of the home)? This can affect the water pressure in the home.

How far is the Well from the septic system (if the property is not on public sewer)? 

When you purchase a Lehigh Valley Home with a Well the water should be sampled and sent to a lab for testing. There are multiple tests that can be done on water but the minimum is Ecoli and Coliform. Is sewerage getting into the water? In addition, Nitrates, Metals and even Pesticides can be checked. Is there lead? Was the land used for farming and pesticides are present? Depending on your mortgage type you may have to test for some of these even if "you" don't care. For instance,a VA mortgage wants a test for "metals" (i.e. lead).

The PA Property Disclosure asks the seller if the well has ever run dry. Hopefully, the seller answers this truthfully. You don't want to purchase a property and run out of water when 3 people take a shower on a Saturday morning.

If the Home Buyer is doing an FHA, VA, or USDA mortgage and there is a septic system on the property there could be an issue if the well and septic aren't the proper distances apart from each other. The Well and the Septic Tank should be at least 50 feet apart and the Well and Sand Mound or Absorption Field should be at least 100 feet apart. When the appraisal is done on the home these distances WILL be looked at.

Although this may seem like a lot to take in, many Lehigh Valley Homes are purchased with wells and septic systems with no issues. 

For all of your Lehigh Valley Real Estate information, visit www.lehighvalleyhomesonline.com

Buying a Lehigh Valley Home with a Septic System

If you are considering Buying a Home in the Lehigh Valley there is a possibility that it may have a Septic System instead of public sewer. 

A septic system is an on-site sewage disposal system. Rather than the home sewage going into a public system it goes into a system that is contained on the property.

The sinks, toilets, laundry...etc all empty into a tank on the property. The solids stay in the tank and the fluids go out to a sand mound or absorption field where they are filtered and go into the ground.

Every few years, the septic tank should be pumped to remove the solids.

If the system is working correctly, the fluids are getting filtered and going into the ground. 

Some Lehigh Valley Home Buyers don't want anything to do with a Septic System. Although you won't get a sewer bill, if the septic has issues it can get expensive. 

If the home buyer wants a house "not" in the city or on a larger lot or in the country it may have a septic system.

As part of the purchase, the Lehigh Valley Home Buyer should elect to get a Septic Inspection done. This inspection is scheduled and paid for by the future home buyer.

The septic system should get flooded with water and the absorption field/sand mound checked to make sure the "earth" is accepting the fluids and the tank is correctly releasing the fluids.

The baffles (filters) in the septic tank should be checked.

The septic tank should be emptied (paid for by the home owner) and checked for cracks and integrity.

If the house has been vacant for more than 30 days a Hydraulic Load Test should be done. This is typically a 2-day test.

Many buyers purchase a home with a septic system but you should definitely make sure the purchase is contingent on the inspection.

For all of your Lehigh Valley Real Estate information, visit www.lehighvalleyhomesonline.com

Down Payment versus Escrow or Deposit on a Lehigh Valley Home Purchase

A topic that is sometimes confusing to a Lehigh Valley Home Buyer is the Down Payment versus the Escrow or Deposit required to Purchase a Home.

There are various mortgages available for a home purchase. Two common ones are 20% down conventional or 3.5% down FHA.

What this means is that for instance on a $200,000 home with a 20% conventional mortgage the buyer is going to have to put $40,000 down and for an FHA mortgage $7,000.

The down payment has absolutely nothing to do with the home or the home seller but is dependent on the mortgage type. This Down Payment is NOT required when you make an offer to purchase the home but is required on closing day when you get the mortgage and successfully close on your new home.

What is required when you make an offer to Purchase a home is a Deposit also called the Escrow. A show of good faith that you intend to purchase the home. This is the money the home seller will attempt to keep if the home buyer without any reason decides not to buy the home.

For instance, on the $200,000 example above you submit the following offer. Mr Seller I will offer you $190,000 for your home and will give you a deposit of $2,000. At this point, the seller can say "I want $195,000 and a $5,000 deposit". 

The price as well as the deposit are negotiable (there are many other negotiable items but for now we are discussing the deposit). 

The home buyer can say "Ok, we accept the $195,000 but will give a $3,000 deposit".

The buyer and seller agree on the deposit and the offer.

Once the contract is executed, the home buyer will have to provide a check made out to the listing company for the deposit. This check will be cashed and the money will be placed in Escrow towards the purchase of the home. On closing day, the listing office will bring that money to the closing and it will get applied to the buyers final costs for the purchase. If the buyer needs $10,000 and the deposit is $3,000 then the buyer will need to bring $7,000.

What happens to the deposit/escrow if the buyer doesn't buy the home?

This depends on "Why" the home buyer doesn't pursue the purchase and what contingencies are in the contract.

If the contract on the home includes inspection contingencies and the buyer and seller can't come to an agreement over repairs the buyer can terminate and ask for their deposit back.

Mortgage and appraisal contingencies are another reason a buyer can terminate and get their deposit back.

A Deposit on a Lehigh Valley Home becomes totally at risk when a buyer decides NOT to purchase a home with no contractual reason. "I changed my mind"

Since the Deposit is held in Escrow it requires the signature of the home buyer and seller to release it and to whom it goes. In certain cases, it may have to be left up to a judge to decide who deserves the money.

For all of your Lehigh Valley Real Estate information, visit www.lehighvalleyhomesonline.com.

What is Leasehold Ownership on a Lehigh Valley Home?

A common question I get asked about a Lehigh Valley Home is what is Leasehold Ownership. 

Leasehold Ownership is typically associated with a mobile home but there are some 55+ Communities in the valley that are stick built homes, on a concrete slab but are Leasehold Ownership.

There are multiple types of ownership with Lehigh Valley Homes.

Fee Simple - the owner owns the home and the land, they are responsible for everything including home maintenance and land maintenance

Fee Simple with HOA - the owner owns the home and the land but there is a Home Owners Association. The HOA may or may not do grass or snow but typically the home owner is responsible for any maintenance/repairs to the home itself. There may be limitations on the land. i.e you cannot put up a fence

Condo - Typically, this means the home owner is responsible for the "sheet-rock" in. The HOA is responsible for all exterior maintenance and the "condo association" owns the land. Fences, gardens...etc are usually not allowed.

Leasehold - the home owner does not own the land. It is leased and a monthly fee is charged to "rent" the land that your home sits on. Leasehold is the type of property with the most variety on what is included or what can or cannot be done on "your" land in each community.

Some common questions with a Leasehold Home in Lehigh Valley:

How much is the monthly rent for the lot?

What does the monthly rent include (water, sewer, garbage, grass, snow, clubhouse or just the land)?

Do I still have to pay yearly real estate taxes? Usually this is a definite YES.

How long is the land lease for each home? Some renew yearly.

Is the HOA leasing the land (Is there a Master Lease)? Whom actually owns it? Am I guaranteed in 10 years that I will still have a home on the lot and will be living there?

Leasehold Ownership on a Lehigh Valley home has many factors that may or may not be the same among communities.

Since the land is not owned on a Leasehold Property, a typical home mortgage cannot be used for the purchase. Your pre-approval with Wells Fargo won't allow you to buy one. Mobile Home Financing, Cash, or private funding with a local bank or credit union are probably the only available purchase/mortgage options. 

Need more assistance? Call Joe at 484-241-1641.

For all of your Lehigh Valley Real Estate information, visit www.lehighvalleyhomesonline.com.

Buying a Lehigh Valley Home with a Veteran or VA Loan for the Mortgage

Buying a Home in the Lehigh Valley using a VA or Veterans Loan for the Mortgage is a fantastic way to purchase your home.

When it comes to Purchasing a Home, Lehigh Valley Veterans may not even realize the benefit they receive by having served our country. I purchased my first and then my second home using a VA mortgage. When I purchased my first home I didn't have a pot to you know what in. What a great loan for eligible vets!

This past week, I closed on a home with a 4 year vet. When we made the offer on the home we put down a $500.00 deposit. At the closing, he needed to bring a check for $267.00. He purchased his first home for only $776.00 out of pocket plus the $375.00 fee for his home inspection.

Multiple fees that may have been required by a home buyer using a different loan type were waived as a result of his service.

A VA Loan DOES require the veteran to purchase a home in better move-in ready shape.

A VA Loan won't work for the home that needs a lot of work and a seller that isn't willing to do any repairs. Bank Foreclosures or Short Sales aren't the best home for a vet to attempt to purchase (since they are sold as-is).

When the Lehigh Valley appraiser on a VA loan goes out to the home they may require repairs to ensure the home is livable and safe to occupy. A VA mortgage DOES NEED a seller that will cooperate if any repairs need to be done to "get the mortgage".

The VA Home Buyer IS NOT allowed to agree to do any "required mortgage repairs" after the purchase. They have to be done beforehand in order to get the mortgage to purchase.

Having said that, a Lehigh Valley VA Mortgage is a great mortgage for an eligible veteran.

Contact me to get the process started.

For all of your Lehigh Valley Real Estate information, visit www.lehighvalleyhomesonline.com

Home Buyers are Looking for Lehigh Valley Homes For Sale

What a difference over the past few years of the number of Homes for Sale in the Lehigh Valley.

A few years ago, I remember publishing stats stating that there were 4,000 to 6,000 homes for sale in the valley. Some homes were sitting on the market for over a year sometimes two. Lehigh Valley Foreclosures and short sales were common and it seemed like at least 2 out of every 5 homes for sale fell into this category.

For the past year (maybe past two years), Home Buyers in the Lehigh Valley have been getting discouraged. They are searching the listings daily. A new home comes on the market and all of sudden there are multiple offers and they haven't even seen the home yet. "What, if we like the house we have to make an offer NOW"!!!

The supply and demand curve is kicking in and it is causing home prices to go up. Frustrated buyers that have access to cash are also driving the prices up. We want this house!! We'll pay you over listing price and waive the inspections.

This has definitely made it difficult for a home buyer that needs some assistance with closing costs or has to sell their current home. Hang in there! Things will eventually work out.

Here is the current inventory in the Lehigh Valley as of March 9, 2019 (Northampton and Lehigh Counties).

Residential Homes Currently For Sale: 1,535

Out of the above

Detached homes for sale: 1,070

Foreclosure/bank owned for sale: 49

Short Sales for sale: 18

There are currently 219 properties listed for sale as investment properties. The deals that investors have been looking for over the past few years are getting very hard to find.

Currently, there are 307 rentals available in the Lehigh Valley.

It is very important for a property buyer to get actively involved with a real estate agent and that they work together to find the "right" property.

For all of your Lehigh Valley Real Estate information, visit www.lehighvalleyhomesonline.com.

Preparing To Sell Your Lehigh Valley Home

Preparing to Sell Lehigh Valley Home

As you consider Selling your Lehigh Valley Home it is important to consider it from a Home Buyer point of view.

Price is critical but so is condition...and it may affect the price!

How does your home compare to other homes for sale? How well does it show versus your competition?

There are some things that a Lehigh Valley Home Seller can do to improve the condition and the buyers perspective of the home.

Carpet/Flooring and new Paint are always a positive!

Overlooked items as you prepare to sell a home are:

Stove/Oven - This appliance is included in the purchase of a home. Make sure it is clean.
Built-In Microwave - Same as Stove/Oven
Ceiling Fans - is there a layer of dust on the fan blades?
Forced Air System? Are the vents clean?
Bathrooms, Showers, Tubs and Sinks - no soap scum, caulking replaced?
Water Stains on any ceilings - if the problem has been fixed, paint.
Nail pops, cracks in any of the walls - Correct!

Lehigh Valley Home Buyers will open the oven and microwave and look at things like ceiling fans and HVAC vents. They may be interested in a home but based on the above may decide the home isn't worth what the seller is asking for it. If they decide to make an offer, they will take the condition of the home into account when deciding on a price.

For all of your Lehigh Valley Real Estate information, visit www.lehighvalleyhomesonline.com.

Buying a Lehigh Valley Foreclosure Property Using a Mortgage

I'm getting a Mortgage so I can't purchase that Lehigh Valley Foreclosure Property!

This is totally untrue. The owner of the property, Mr or Mrs Jane Doe, Wells Fargo Bank (foreclosure) or the Triple A Investment Firm DOES NOT matter on a home purchase.

What matters is the condition of the property and whether or not the seller will fix/repair any issues that can be an issue with getting a mortgage.

Different mortgages want the property to be in better condition.

For instance, a conventional mortgage may be okay with a repair that is needed since the buyer is putting 20% down.

The problem, that may not be a problem for conventional financing may be a show stopper for an FHA mortgage (3.5% down) or a USDA or VA financing with 0% down.

The mortgage company is lending you more money so they want the collateral (the property) to be in a better shape with no repair issues.

The main issue with purchasing a Lehigh Valley Foreclosure Property and getting a mortgage is that Foreclosures are typically sold as-is. The buyer can get the inspections done to determine any needed repairs but the bank is not going to fix anything.

If the Lehigh Valley Home has a major problem, your mortgage company may require it get fixed before closing. The Bank (seller) says Nope, we said it is being sold as-is. Take it or leave it.

This does become more of a problem when using FHA, USDA, or VA financing to purchase a Foreclosure Property.

Many foreclosure properties do have issues that will be a problem with a mortgage (mold or water damage..etc) but some can qualify.

In fact, some of the banks do repairs before listing the property in order to increase the pool of potential home buyers and get a higher price for the property.

Don't rule out foreclosure properties just because you are getting a mortgage. Worst case, you can use an FHA 203k renovation loan in order to purchase the property. (purchase the home with a guarantee to borrow additional funds for the required repair)

For more information about Lehigh Valley Real Estate visit, www.lehighvalleyhomesonline.com.

Buying a Home in Lehigh Valley with Zoning Issues

I recently ran into a situation in the Lehigh Valley where a Home was being sold as Residential but it had been previously Zoned as Commercial. 

Halfway through the transaction, the appraiser for the mortgage company stated that paperwork was needed from the township to state the property was "now" considered residential.

The township required an inspection in order to change the zoning of the property.

The property was being purchased under a USDA residential home loan. If not deemed residential, the loan would not be approved on the property and the Home Buyers would have to find another property.

The Lehigh Valley Home Seller said "no problem, he had obtained all the permits" and it shouldn't be an issue.

Unfortunately, the seller had not requested the final inspections with the township.

When the township inspected the property, they determined 4 of the windows needed to be replaced.

Then, all of a sudden, the Lehigh Valley Home Seller wanted the buyer to help pay for the windows.

The property was listed For Sale as a residential property. It wasn't the home buyers fault that the township wanted some windows replaced. The buyers said No they would not contribute any money to resolve the issue. It wasn't "them" requesting new windows and the property was listed as a residential sale.

The home seller did eventually agree to replace the windows but it caused a delay and the property was not able to close on time.

If the purchase had fallen apart because of this there is a possibility that the buyer would have won in court to get their expenses (property inspection and appraisal) reimbursed. The home seller was not able to convey the property as listed.

For all of your Lehigh Valley Real Estate information, visit www.lehighvalleyhomesonline.com

Using a PFHA Mortgage to Buy a Home in the Lehigh Valley, Bethlehem, Easton and Allentown

Buying a Home in the Lehigh Valley with an FHA mortgage requires that the buyer has 3.5% of the purchase price as a down payment. 

A PFHA Mortgage is a mortgage that sort of sits on top of an FHA mortgage and gives a second loan to cover the 3.5% down payment.

This is a good option for someone who qualifies for a Lehigh Valley Home Mortgage but doesn't have the needed funds to move forward.

A USDA mortgage allows a home buyer to do 100% financing. A PHFA is similar but unlike a USDA mortgage the home buyer is not limited to buying in a "rural" area. They can purchase a Home in Bethlehem, Easton or Allentown.

The one downfall with an FHA or PFHA mortgage is that the home buyer must purchase a home in good shape and is move-in ready. The appraiser (from the bank/mortgage company) is going to view the home and decide if there are any needed repairs. 

A home buyer must purchase a home that is in good shape or hope that the home seller will make any repairs that come up as a result of the transaction.

A home being sold as-is with known problems is typically not an option for a PHFA mortgage.

For all of your Lehigh Valley Real Estate information, visit www.lehighvalleyhomesonline.com.