3.5% Down Payment

Welcome to THE REAL UPDATE - every Monday morning we bring you the latest real estate news from Westchester County. We talk about developments, listings, sales, renovations, debt, architecture, & businesses.

Listing of the Week:

14 Butler Hill Rd, Somers, NY 10589

This multi-family property is listed at $550,000 and includes 2 detached homes. The larger, primary home has 3 beds/1 bath and the cottage has 2 beds/1 bath. The property also includes an in-ground pool and a detached garage.

Check out this listing here. 

Proposed Development:

North Division St & Howard St, Peekskill, NY 10566

A mixed-use development with 125 apartments & 16,000 square feet of retail space has been proposed in the town of Peekskill. 125 parking spots are included in the plan along with a select amount of affordable units. The site is approximately 1 mile to the Peekskill train station.

Check out the lohud article here.

Financing Rates:

Westchester County Real Estate Brokerages.

This article from 2022 highlights the largest brokerages in the county by the number of agents.

SPOTLIGHT: First-Time Homebuyer’s Loan

The majority of homebuyer’s purchase their home with a 20% down-payment on the property and finance the rest with a conventional mortgage.

On a $500,000 home, a 20% down-payment means putting up $100,000 cash to purchase the home. There are also various additional expenses along with the down-payment. Cash is required for the appraisal, title search, mortgage tax, inspection, attorney fees, underwriter fee, & more. All these fees quickly add up to an additional $15,000-30,000. With the example used this would mean a minimum of $115,000 cash on hand to purchase a home with a 20% down payment.

If you do not have this much saved up, there are alternative options to become a homeowner. Lenders offer mortgages with a 10% down-payment or for the lowest possible money down, there is the First-Time Homebuyers Loan. This loan requires a 3.5% down-payment. On a $500,000 house, this would be $17,500. When you include the additional closing fees of $15,000-30,000. The total cash needed to buy the home would be approximately $35,000.

While this 3.5% down-payment may allow homebuyer’s to purchase their dream home at an earlier point in time (rather than save $115,000 for a 20% down-payment) that does mean 96.5% of the property will be financed by debt owed to the bank. Also, until the buyer reaches 20% equity on the property, they will be required to pay PMI - Private Mortgage Insurance. On a $500,000 home, mortgage insurance would be an additional monthly payment of $320.

Written By: Thomas Cane

thomascanerealty.com

beehiiv.com/therealupdate