Mortgage information

Maybe it's because it's an important part of my job, but I am fully aware that home buyers do not need 20% down to finance a home. I understand it's common to think you need 20% saved, but it's not necessary and I want to express that to potential buyers out there. With conventional financing in our area, you can go as low as 5% down. Then there are other mortgage programs such as FHA and USDA financing that allows you to go even lower.
Putting more down (20%+) eliminates private mortgage insurance (PMI) fees every month, but you can refinance down the road and get rid of that if you originally only put less than 20% down.
I bring this up because I recently read an article on Yahoo! written by a woman that wasn't educated on the different loan programs. She spoke to lenders and they calculated that buying now with less down may actually save you money in the long run! Taking into account homes appreciating and interest rates continuing to rise, if you wait a few more years to save, you would have missed the current benefits.
Here is an example:

"Saving for 20 percent could cost thousands

Our lenders assured us we could get a loan with 10 percent down or, in some rare cases, even less. But I was still nervous. How could less equity equal more savings?

It's actually fairly simple: While we're busy saving, interest rates and home prices are going up. By the time we reach 20 percent down, that money won't buy us as much house as it will today.

So we decided to play hypothetical math and run some numbers. If we put 10 percent down on a house for $200,000 now and secure a 4 percent interest rate, we'll pay $384,365.11 over the life of the loan.

But if we wait a few years and put 20 percent down on the same house -- which we project might sell for $225,000 -- and secure a 7 percent interest rate, we'll wind up paying $455,613.79 over the life of the loan. That's $200 more every single month for 30 years, for a total of $70,000 more."

Pretty interesting huh? Makes complete sense though. I like her final remarks

"But if, like us, you don't have 20 percent saved up yet, you should still check out your options now. Don't wait; don't be afraid to start the process. Talk to lenders, talk to banks, talk to mortgage brokers and real estate agents.

My biggest mistake was not talking to lenders earlier and hearing about the kind of loans and homes we could actually get. Find out what you can afford and realize that you may well be closer to your dream home than you think."

For full article: http://homes.yahoo.com/blogs/spaces/puts-20-down-house-not-nearly-many-might-175056896.html

Here is a quick video on our national sales statistics for June:

Monday Morning Market update

Local update
In May, the Philadelphia region saw a normal seasonal tapering of activity, but appointments and pending/settled properties showed significant increases compared to last year. All indication are that June will have the highest number of closed transactions in any month since the end of the First Time Buyer tax credit 3 years ago. 


Montgomery county reported a 10.3% decrease in Total Inventory in May 2013 compared to May 2012 with a 28% increase in pending units and a 13% increase in settled units over the same time period.

I've personally seen the affects of the low inventory in various towns throughout the Spring resulting in more June scheduled settlements than I've seen in years.
This shift in the market is making a great time to sell your home and move up- either to a bigger house or change towns and schools. Interest rates are keeping monthly payments low and houses are selling- even for above asking prices.

National News
A more recent count of inventory is showing that nationally, more inventory is hitting the market everyday.

"As the spring home buying season transitions into summer, month-over-month inventories are rising faster than they were as sellers respond to price increases at a faster pace than earlier in the buying season. On a national basis, both list prices and Inventories rose in last month, according to Realtor.com’s May data.

Inventories have risen by about 25 percent since the beginning of the year, signaling a potential end to a sellers’ market and a greater balance between market supply and demand. The monthly increases in the for-sale inventory that took place in the past two months are among the highest observed since Realtor.com has been collecting these data.

In May the inventory deficit fell to 10.11 percent on a year-over-year basis. Realtor.com’s inventory (1,852,740) was larger in May than it has been in ten months."

(source NBC news)

This is pretty neat! Couple builds a home that is 98% Made in America!

Visit NBCNews.com for breaking news, world news, and news about the economy

Buying your first home?

With the continuation of low interest rates and home prices, it's great time for first time buyers to start getting serious about purchasing a home.

Last week a client of mine purchased her first home and is paying approximately $1,100 a month for a 3 bedroom townhome (plus having a roommate which will be paying that mortgage too!). This week a first time buyer of mine is buying a cute single family home and paying approximately $1450 a month. How much is your rent right now? Maybe it would be just as affordable to pay your mortgage instead of your landlords. 

If it's your first home, chances are you will be financing the purchase. To get an idea of current interest rates, I like to check out Yahoo! Finance page on a regular basis http://finance.yahoo.com/

But I also recommend, if you are at the serious buying stage, you should already have a mortgage professional whom you're working with that is keeping you updated on rates. 

Home affordability is at historic levels. I suggest at least looking into seeing if it's a good time for YOU and your life at this time.

The combination of the first 2 graphs- interest rates and housing prices- has made the Housing Affordability Index sky rocket over the last year.

Looking for a long term Investment property?

Here are 3 great listings, in 3 different areas of Philadelphia, that would make a fabulous long term investment!
Whether you want to live there now then rent out as additional income in a few years or purchase strictly as a rental unit, they all offer great potential for renting.
What makes up a good investment? In my opinion:
Location- public transportation, shopping/dining, major roads, office and corporate buildings near by
Low Maintenance- for you as the landlord and for your tenant
Low price making your mortgage payment below local average rental price so you generate profit
Desireable School District

Northeast Philadelphia:

Totally Renovated twin from Top to Bottom! Beautiful Hardwood flooring throughout the first floor, recessed lighting, updated Kitchen with Maple Cabinets, SS appliances and Granite. Natural light shines through the New sliding glass doors which opens onto an oversized Deck. Upstairs features all New carpet, 3 nice sized bedrooms and Bathroom with stylish tile, new vanity, tub and toilet. New windows, New HVAC, New plumbing and electric





Media:

Great opportunity to own a home in Media! Just minutes to all the essentials- hospital, schools, entertaining and major roads. This move-in ready 3 bedroom 2.5 bath townhome is located in the desirable Granite Run community on a wooded lot providing extra privacy. Fresh paint, new carpets, new roof and more! The main bedroom features skylights, walk in closet and its own full bathroom. Just down the hall is the washer/dryer, hall bath and the second bedroom with it's own deck overlooking the woods. The third floor is an extra large bedroom.

Bridgeport:
Well maintained townhome conveniently located in Bridgeport with easy access to highways, public transportation, King of Prussia shopping, and entertainment. This 3 bedroom 1.5 bath home is move-in ready and has a lot to offer! New carpets, fresh paint inside and out, Newer remodeled bathrooms, updated spacious kitchen, Newer windows & HVAC and recently re-coated roof. Upstairs includes the 3 bedrooms, ceiling fans, 2 solar light tubes providing tons of natural light and a full bathroom with 2 sinks. The finished walk out basement features a wet bar and outside patio- ideal for entertaining. Two parking spaces in the rear of the home and plenty of parking out front.