Lehigh Valley Real Estate Blog, Home Buying & Selling Information

Problems when Asking for Sellers Assist when Buying a Lehigh Valley Home

A lot of Lehigh Valley Home Buyers need some type of Sellers Assist (also known as sellers concession) when purchasing a home. The home buyer has saved up money but just doesn't have enough to cover the down payment plus the closing costs.

Sellers Assist CANNOT be used towards a buyer's down payment but it can be used to cover almost all of the closing costs.

Conventional mortgages usually allow for up to a 3% sellers assist of the purchase price to be used towards closing costs. FHA, VA, and USDA mortgages allow up to 6%. Depending on the purchase price, closings costs usually run from 4-6% of the purchase price.

There are three major problems that can occur when an offer on a home contains sellers assist.

The home was just listed two weeks ago for $200,000. The buyer submits an offer and is willing to pay full price but needs 6% sellers assist. 6% of $200,000 is $12,000 dollars. If the buyer makes a full price offer but requests a 6% sellers assist, the sellers will actually be offered $188,000 ($200,000 - $12,000).

If the buyer definitely needs the sellers assist, the seller can accept the offer or they can counter with something like "We'll give you the 6% but at a purchase price of $205,000". Going above the list price always brings in an appraisal concern (more on that later).

Okay, the buyer and seller come to terms on the price and sellers assist (Problem 1 solved).

Now, the buyer gets the inspections done. There are some needed repairs to the home. The home buyer submits an inspection reply to the seller asking the seller to pay for and have the problems corrected.

The seller gets upset and isn't willing to do the repairs. "I am already giving them 6% towards their closing costs!!" is a common reply.

So, the buyer has a seller that is willing to give them 6% sellers assist but won't do any repairs. Will the buyer make out better putting an offer on another home? What if that home seller has the same attitude?

The buyer ends up asking the seller for a smaller subset of needed repairs. The seller agrees and the purchase is moving forward (Problem 2 solved).

The bank orders the appraisal. Is the home worth the price the buyer is paying for it? Are there any needed repairs (the appraiser is the eyes and ears for the bank)?

Hopefully, the home will appraise at the purchase price with no repairs.

If the Lehigh Valley Home under appraises (the appraised value is below the purchase price) or has required repairs another obstacle must be overcome between the home buyer and seller.

If the home appraises for less than the purchase price and the buyer definitely needs the asked for sellers assist, the only option the home seller has is to accept less for the home.

If the lender requires any repairs, these must be done before closing or else the buyer will not get the loan. Either the buyer or the seller will need to do the required repair(s).

If the everything is okay with the home appraisal or can be worked out then you are on your way to closing on the house (Problem 3 solved).

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

April 2012 Lehigh Valley Real Estate Sales and Market Conditions

Even with rising gas prices Lehigh Valley Real Estate Sales were still up during the month of April.

In April of 2012, there were 4,773 homes for sale in the Lehigh Valley (an increase of 3.5% from April of 2011).

Last month, 692 homes went under agreement. That is an increase of 42.4% from the number of homes that went under agreement in April of 2011 (486 homes).

In April of 2012, 447 homes were sold and settled. That is an increase of 22.1% from a year ago (366 homes).

Out of the 4,773 homes for sale in April, 731 of them were bank owned or foreclosures.

The median price of Lehigh Valley Homes for sale in April was $185,000. The median price of homes under agreement was $169,900 and the median price of homes sold and settled was $172,000.

The average days on the market for the Lehigh Valley was 85.

Top 3 Ways to Make Your Lehigh Valley Move Easier

Moving is rarely a walk in the park. No matter how excited you are about your new Lehigh Valley Home, actually moving all of your stuff into it is often an exhausting, stressful, and daunting task. Planning ahead and being proactive are two of the most important ways you can make your move easier, but many people end up taking a haphazard approach to moving. They wait until a few days before their move to pack and make arrangements, and then they find themselves struggling to get everything done efficiently. If you’re about to move there are a few things you can do to be proactive that will make your life a whole lot easier. Here’s some of what you can do:

1. Start packing as early as you possibly can – This doesn’t mean you have to pack up all of your pots and pans three weeks before you move and eat out every day until you arrive at your new home. Just start packing things you don’t use every day. Getting some of the work done before crunch time will save you a lot of stress.

2. Consider moving with less – You’ve worked hard for everything you own, and it’s an understandable impulse to want to try to take it all with you to your new digs. However, moving with all of your things just means more work for you. So, go through the rooms of your house and see what you can get rid of. You might even want to donate a few boxes to Goodwill or the Salvation Army, so you don’t feel as though your belongings are going to waste.

3. Get the right supplies – Doing anything without the right tools is a challenge. So, make sure you have plenty of boxes to properly pack up your stuff, gloves, packing tape, and a hand truck. If you’re going to hire movers to help you transport your stuff, it’s still a good idea to have some basic moving supplies at your disposal. Unless you want to pay a moving company an exorbitant fee to pack up all of your stuff and move all of your small boxes, you’re going to have to do some of the work yourself.

As you can probably tell, preparation will be your key to success as you move. So, pack before it’s time to move, move with less, and make sure you have an arsenal of tools to help you out.

Author’s Bio: Lisa is a guest blogger on the subjects of home improvement, moving tips, and storage units in the United States, specifically storage units in Virginia Beach and storage units in Tallahassee.

Selling Your Lehigh Valley Home When You Don't Have A Home To Buy

As a Lehigh Valley Home Seller, you want to sell your home but you are worried that a buyer will purchase your home and YOU MAY NOT have a home to buy. Can you end up homeless?

Unless a home sale contingency of some type is put in the agreement of sale on your current home, the answer is YES. You will need to move out of your current home on the agreed upon closing date.

If you haven't found a new home or you can't get the closing dates to line up (allowing you to move out of your current home and into your new home on the same day), you can end up out on the street.

You can list your home for sale and make it contingent upon finding a home. A clause can be put in the contract similar to:

"Buyer and seller agree that the seller will be given 30 days to find and purchase a new home. Buyer agrees to modify the closing date to concur with the closing date of the sellers new home. In the event that the seller does not find a home within the 30 day period either the buyer or seller may cancel this contract or agree to renegotiate the terms."

This, of course, is a huge negative to a buyer interested in purchasing your home. The Home Buyer has to give you 30 days to find a home and worst case you may not find a home and cancel the agreement of sale.

In addition, if you do find a home, you may want to change the closing date. How can YOUR home buyer plan their move.

These negatives typically cause a Lehigh Valley Home Buyer to make a lower offer on your home. If they are going to take the risk (that they won't get the home or have to change their moving plans), they are going to want a better deal. 

As the Home Seller, you want to get the best sale price on your Lehigh Valley Home. You may be better off not having a contingency on your home sale that relies on you being able to find a home.

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

Mortgage Interest Rates when Buying a Lehigh Valley Home

You got your pre-qual or pre-approval from your Lehigh Valley Mortgage Company and you are good to go.

Your monthly mortgage payment will be X amount of dollars based on the purchase price, taxes, and interest rate.

You find a Lehigh Valley Home, make an offer, and it is accepted. Now you are Under Agreement. Time to get the mortgage rolling.

What do you mean the interest rate is 4.00? You told me it was going to be 3.875!!!

The Lehigh Valley Home Buyer immediately thinks the mortgage rep lied to them.

The mortgage interest rate is not "locked" in until the home buyer makes an offer on a home, it gets accepted, and full application is made for the mortgage. At this point, the home buyer can "lock" their rate.

At the time the pre-approval or pre-qual is given, the mortgage rep uses the interest rate on that day (they have to use something for the interest rate). Unfortunately, this rate may not be the rate you get when it is actually time to do the full application for the mortgage...rates may have changed since the time the pre-approval or pre-qual was issued.

You may want to contact your Lehigh Valley Mortgage Rep before making an offer on a home to determine the current rates and your monthly payment.

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

Buyer or Selling a Lehigh Valley Home with an Underground Oil Tank

When Buying or Selling a Lehigh Valley Home, oil heat is common especially as you get further out from the cities. 

One concern with oil heat is whether or not the oil tank...or an old oil tank...is buried in the yard. If an Underground Oil Tank has leaked it becomes an EPA issue.

If a home owner is selling the home, than a Property Disclosure should be available that will answer many of the questions. In addition, specific questions can be asked of the seller. You put a new tank in your basement? What happened with the old tank? ...etc

If the purchase is a Foreclosure Property, information about a possible underground oil tank may be a complete unknown.

A good Property Inspector may find evidence that an underground oil tank is possibly on the property.

If this occurs, a professional "tank" or "environmental" company should be consulted to determine the next step. They can check the property to see if a tank exsists and/or do soil probes to check for leakage.

Another source of information, on a foreclosure property, is the neighbors. Sometimes, they were friends with the home owner or saw work being done at the house.

Underground Oil Tank problems can be fixed but a Lehigh Valley Home Buyer should be aware of a potential problem and the possible financial costs that may be incurred to correct the problem.

Before a Home Seller lists a property with an underground oil tank, they may want to have it checked to make sure it is not going to cause a problem with the home sale. Even if the buyer wants the home, the mortgage company may put a stop to the purchase.

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

Lehigh Valley Real Estate Market Stats for February

If you are considering buying or selling a home in Lehigh Valley you are probably interested in the Real Estate Statistics for the area.

The February 2012 Real Estate Market Statistics are available for Lehigh and Northampton Counties.

Northampton County Real Estate Market Statistics

Lehigh County Real Estate Market Statistics

If you are interested in more detailed Real Estate Statistics for Municipalities and School Districts in Lehigh Valley visit:

Complete list of Lehigh Valley Real Estate Statistics for February 2012.

Pitfalls when Buying a Lehigh Valley Foreclosure or Bank Owned Property

A common request in Lehigh Valley these days is a home buyer or investor that wants a good deal on a Foreclosure or Bank Owned property.

Some Lehigh Valley Home Buyers believe the bank will accept an offer that is way below the list price. It doesn't typically happen. The bank has had the home appraised or a BPO (broker price opinion) and is going to attempt to get an offer for what they believe the property is worth. They will slowly reduce the list price until an offer close to that price is obtained.

This doesn't mean you can't get a good deal. It just means they aren't going to accept 25% or more from the current list price even though eventually the property may sell for close to that price.

Pitfall #1

All Foreclosure properties are sold as-is. You can make an offer contingent on inspections but it is a take-it or leave-it deal. Some repairs may become a required repair in order to get the mortgage. Even if the buyer is willing to accept the property with the problem, the bank may not be willing to lend the money unless the problem is fixed.

Pitfall #2

All of the utilities may be turned off and the home may be winterized. An offer on a Foreclosure Property allows for inspections but in most cases the buyer may be responsible for having the utilities turned and the home de-winterized. In some cases, the buyer may be faced with an empty oil tank and even small things like burnt out light bulbs (have to check the electrical).

Pitfall #3

The utilities need to be turned on for the inspection and the appraisal. The buyer gets all of the utilities turned on for the inspection. Everything is okay. Then two weeks later the appraiser goes out to the house and fails the property because the utilities have been turned back off and they are not able to verify the plumbing and heating system are working. The mortgage can't be obtained until the appraiser signs off that everything is okay.

Pitfall #4

Everything goes fine with the home inspection and appraisal but a legal problem is discovered in the foreclosure process. The buyer can't close on the property until it is corrected.

Some examples (from my personal experiences):

- the deed on a home was in the name of "HIS". It should have been "HSI" (the bank). When the deed was typed up Word auto-corrected HSI to HIS. The mistake was not caught and caused a two month delay in the closing in order to correct the deed and re-record it.

- a deed transfer was typed up incorrectly. The deed should have transferred ownership from Bank of America to Fannie Mae. It was typed up the other way around. This held up a closing 3 weeks.

- a piece of land having a home with a pool and driveway were on two separate tax parcels. The bank only foreclosed on one of the parcels (the house). The back part of the yard was legally still owned by the original owner that they had foreclosed on. The title company discovered this a few weeks into the transaction. The bank immediately terminated the sale even though the buyer had already done all of the inspections and appraisal (at their expense ~$1,000). The buyer has right of first refusal when the home comes back on the market but no definitive answer was given on the time frame to fix the problem.

Pitfall #5

There is no emotional behaviour on the seller side. This could be a good thing or a bad thing. Sometimes sellers go off the deep end with buyer requests. With a bank no one seems to care. The ability not to close on time doesn't matter. The buyer will have to deal with it.


I've worked with many home buyers on the purchase of a foreclosure or bank owned property. These properties range from a diamond in the rough (carpet and paint and you have a nice home) to homes that should be gutted and started over again.

There are work-arounds for many of the "pitfalls" encountered during the inspection/appraisal process but the legal issues are fully dealt with on the seller side. These problems need to be addressed by the seller and there is not much the buyer can do to correct things.

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

Lehigh County Tax Assessment in Lehigh Valley

For a while now, I have been following the re-assessment in Lehigh County. It’s complicated but the bottom line is your taxes are derived from the assessed value (what the county feels your home is worth multiplied by the millage rate for each tax (county, municipal, school). This generates your 3 yearly tax bills. (assessed * school millage), (assessed * municipal millage), (assessed * county millage)

Almost yearly, Lehigh Valley Millage Rates change (go up) as school and other taxes are raised.

If your home is older, what did not change since the 1990’s (in Lehigh County) was the assessed value.

Your Lehigh Valley Home may have doubled in value throughout the years but the assessed value was still based on the old value.

On the other hand, if you purchased a new Lehigh Valley home, the assessed value may have been determined during the boom. In some cases, new home owners were paying more than double what the older home owners were paying for the same type of home. Yes, it was a new home but double the taxes??

In order to correct the disparity, Lehigh County re-assessed all of the homes and at the same time decided to set the assessed value at 100% of the home’s value.  In the past, the assessed value was some magic number below 50%.

Since the county redefined the definition of the assessed value, it means that all of the millage rates also need to change.

In order to offset the assessed value, going to 100%, the millage rates should all go down.  If not, everyone’s taxes would double. It also makes the millage rates look better (i.e. 0.25 for school instead of 0.55)

Lehigh County Taxes could increase or decrease. It depends on if the county believes your home is worth more or less than the last time it was re-assessed.

At this time, Northampton County IS NOT doing the re-assessment.

For more information, visit www;lehighvalleyhomesonline.com

Buying a Lehigh Valley Home with a Well for the Water Source

As you view homes in the outskirts of the Lehigh Valley, it is common for the property to be serviced by an on-site Well for the Water Source.

Some home buyers are intimidated by a well (and septic) and will completely avoid these homes. They may be missing the opportunity to own a great home.

When purchasing a home that has a Well, a Lehigh Valley Home Buyer should take some precautions.

There are three main concerns with a well:

1) Is the water safe to drink and use (potable)?

2) Does the well have adequate capacity (you wouldn't want to run out of water in the middle of your shower)?

3) What is the depth of the well (the deeper usually the better)?

When purchasing a home with a well you should have a test done on the water. There are a variety of tests but typically Coliform is the main concern especially if the well is near a septic system. You can also test for lead, pesticides, and other chemicals. Some mortgage types require specific testing.

If a problem is found with the well water, an ultra-violet light (to kill bacteria) or water conditioner may be needed. Fixing of the problem becomes a negotiating point with the seller.

If a well does not have an adequate water supply, the problem may get a little more complex. If it is deep (300-500 feet), Hydrofracking may fix the problem.

If the well is shallow or hydrofracking doesn't work, a new well may be needed (typically, in the $3,500 to $5,000 range) and an estimate should be obtained for a new well and location. Usually, a permit is needed from the Lehigh Valley Municipality to install a new well.

If a septic system is on the property, to meet FHA guidelines, the well and septic absorption field should be at least 100 feet apart.

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