Monday, April 7, 2014

The "Price" of a home and the "Cost" of a home

Sellers are concerned about the "price" their home will sell for.  The "price" is the gross proceeds they will receive on settlement day.  Expenses such as commissions, taxes, legal fees and such will be deducted from this "price" on the HUD 1 settlement sheet to arrive at the "net proceeds".

Buyers, on the other hand, should be concerned about the "cost" of a home as well as the sales "price"   negotiated in the sales contract.

This "cost" can be displayed in terms of the monthly PITI.  The monthly PITI is the principal and interest paid on the mortgage and the real estate taxes and hazard insurance as monthly costs.

It is projected interest rates will reach 5.7% by 2015.  The KCM Blog has an excellent post on this topic this morning as well as the wonderful chart below.  Simply click on the link to go directly to the post.

In the meantime, lets concentrate on 2014.  The interest rates are still low, in terms of the history of mortgage rates in this country.  It is an excellent time to buy and sell.

If you would like to buy or sell a home call me today.  I will treat your transaction as if it were my own.

Thank you for visiting my blog, have a great day!

                                                           Carla Brooks

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