What is PMI?
PMI is private mortgage insurance. It is insurance for the mortgage lender in situations where you stop making payments on your mortgage. It is protection for them. PMI is usually required when you still owe more than 80% on a mortgage loan. If you owe less than 80% of the loan amount you should inquire about having the PMI removed from your monthly payment.
Back to IndexHow much does it cost to buy a home?
To buy a home you will want to consider some costs involved…
- Down payment (FHA is 3.5% and Conventional is 5% of the sales price)
- Initial earnest deposit
- Closing costs (usually around 3% of the sales price)
- Appraisal
- Home inspection
- Points to buy down interest rate if needed
- Home Warranty (optional)
The good news is sometimes you can ask the seller to cover some of the costs to assist in closing. There are also some zero down payment programs.
Back to IndexDo I need an attorney to buy a house?
Having an attorney when purchasing a home is not necessary. If you are uncomfortable with all the paperwork involved or the negotiations of an offer you can seek an attorney to assist you with it. In New Jersey, a real estate agent can not interpret or explain the contractual paperwork for you. They can not advise on New Jersey real estate law.
Back to IndexHow much will it cost to sell my house?
In New Jersey, the seller pays the real estate commissions. The average commission rate is 6%. 3% goes to the listing agent and 3% go to the buyers agent. Remember, that 6% is always negotiable. The sellers closing costs are a complicated list of fees and services but for a ballpark figure you can estimate 1%. So, whatever price the home sells for you should estimate 7% to determine how much you will pay.
Back to IndexWhat is title insurance?
When purchasing a home the title company will check to make sure there is nothing attached to the title such as liens or encumbrances. Even the most skilled professionals may not be able to find out everything guaranteeing that a title is free and clear. This is where title insurance will protect you or your lender.
Back to IndexWhy use a realtor to sell my home?
Selling your home is not an easy task. There is a lot that goes on behind the scenes to close a deal. A realtor can negotiate contracts and guide you through the endless paperwork involved in a sale. They will market your home, get it out into the public spotlight, speak to other agents who may have buyers lined up, answer all of your questions, and loyally represent you. Still interested in selling on your own? Check out my article on selling your home without a realtor.
Back to IndexHow long will it take to sell my house?
There are many factors that can impact the time it will take to sell your home. The average time it takes to sell a home in South Jersey is about 2 months. Three main factors are price, location and condition. If you are priced too high you may not even get buyers to look at it. Is the house in a desirable or convenient location? Does it look brand new or is it cluttered with a “lived in” look. Your real estate agent can come up with a marketing plan to make sure it sells according to your goals. And don’t forget, after you receive an offer you’ll still have 30-45 days until it actually closes.
Back to IndexWhy shouldn’t I overprice my home?
If your home is priced above market value there are some problems that can arise. Most buyers will need to obtain a mortgage to finance the house. The mortgage lender will require an appraisal to be performed. If the appraised value is less than the sales price the buyer will need to come up with the extra cash, the seller will need to lower the price, or the buyer could cancel the contract. Another reason not to overprice the house is that it could sit on the market indefinitely and you may not get showings by potential buyers.
Back to IndexHow can I find out the value of my home?
The best way to find out the actual value of your home is by having an appraisal performed by a licensed appraiser. This isn’t always necessary. A real estate agent can look at homes similar to yours that have sold in the past few months. They will put together a ballpark price of what yours will sell for. Regardless of these numbers, the seller picks the price they would like to list at. Real estate agents usually offer a free market analysis for you.
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