shadokeeper

FHA Closing costs

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So we made loan app for our FHA loan for our house and we have been approved, but our Loan guy is saying it is to late to include closing costs in the loan, he says that the closing costs would have needed to be added to the cost of the home on the purchase agreement. This does not sound rite to me. FHA allows you to finance your closing costs! I am worried this guy has financed closing costs and is going to tell us to pay them as well... What do you guys think?

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I think you need a new guy as this info should have been disclosed upon approval.

FHA cost are a little steep but i think it is the better loan out there minus a VA if you are a Vet with a disability.

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FHA does not allow you to wrap your closing costs into the mortgage directly. What they allow is that the seller pays costs/prepays, which you would stipulate in the offer you make to the seller. It is not done at the closing table and the lender does not cover it.

For instance, I paid $92150 for my house and asked the seller to pay up to $4,500 in closing costs and prepays. That was in my original offer (well, after some haggling) My closing costs/prepays came out of the seller's money, so it was financed from my side as a part of the mortgage but the lender isn't paying those costs directly. From the lender's standpoint, I paid $92150 for the house and the seller paid the closing costs/prepays out of their cut of the money.

If you put an offer on the house and did not ask the seller to cover closing costs/prepays, you will have to cover them yourself.

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I know with my FHA loan that all closing costs, appraisal cost, and the 3% downpayment were included in my final loan. Only thing I paid up front was $500 earnest money to my seller. All of this was done through a gift program. Before the loan even closed though, my broker presented me with a very long sheet of costs and had me sign it. I'm thinking this is now a requirement. I think I read that somewhere pretty recently.

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ok i got it thanks guys, so the lender was not blowing smoke up my bum. When he said the seller would have to pay them and it would be in the purchase agreement. To which it was not part of so it is our responsibility to pay. I was so Pi$$ed off at the lender and My partner, I am now mad at our Realtor for not informing us that if we want to "finance" our closing costs we need to say that in our proposal... If i am understanding correctly... Thnaks again guys :)

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OP, if you have not yet had the appraisal, you can add the cc costs into the price now (if you want to do that), but you would have to modify the contract. Of course, the seller would need to cooperate. If the appraisal is finished, it's too late to do it.

DeannaTX, those third party gift programs were stopped last year for FHA.

As to the long sheet of costs - that has been an FHA requirement for many, many YEARS - at least the last 15+ (hard to remember that far back!):shock:

Believe it or not, the costs vary tremendously from lender to lender, even in the same area. So make sure your loan officer provides a detailed accurate good faith estimate right up front and tell them you are going to check it against the closing statement for accuracy (some of the loan officers 'fudge' the numbers by low balling the third party charges and claiming they had no way to know what they were going to be!).

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Oh okay now I remember where I read that at.

From the RESPA website when researching for another thread:

http://www.hud.gov/offices/hsg/sfh/res/respa_hm.cfm

HUD will require, for the first time ever, that lenders and mortgage brokers provide consumers with a standard Good Faith Estimate (GFE) that clearly discloses key loan terms and closing costs. HUD estimates its new regulation will save consumers nearly $700 at the closing table.

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Actually, there are gift programs. Just not the ones you are thinking of. You can get a monetary gift from a Church, parent, sibling, etc. I just closed this week and I had a gift of $4000.00 from my parents. I just had to have them sign a paper saying it was a gift, and I didn't have to pay it back.

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ok i got it thanks guys, so the lender was not blowing smoke up my bum. When he said the seller would have to pay them and it would be in the purchase agreement. To which it was not part of so it is our responsibility to pay. I was so Pi$$ed off at the lender and My partner, I am now mad at our Realtor for not informing us that if we want to "finance" our closing costs we need to say that in our proposal... If i am understanding correctly... Thnaks again guys :)

Your loan officer had already submitted your application and received an approval. An FHA loan has a case number assigned to it, and the rate has probably been locked for 30 days.

However, a lender may pay most closing costs by adjusting the interest rate and using yield spreads to cover the closing costs.

Upfront Mortgage Insurance may be financed, and adds to the mortgage.

And, yes, you can still have the seller pay most closing costs (excluding prepaid items, i.e. taxes and insurance), but as a previous poster indicated, this must be part of the purchase agreement.

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I don't know how you got this deep into the deal without being clear on what was happening. Somewhere along the way either yourself, your broker, or your realtor had to ask about closing costs. Somewhere along the way you should have gotten a GFE telling you how much your closing costs would be on a home that costs X amount of dollars and it should have been clear how much you need to bring to the table at closing.

Also, when you submitted your offer on the home you should have asked for %4 back to cover closing costs. If you didn't do it then, good luck getting them to go for it now, since you'll be offering them %4 less then what they agreed to take for the property.

I would fire the broker and the realtor and start over.

Eddie

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We are deep! We close in 14 days, we have already had loan approval, and appraisal.

Ok i have a question, we were told that we should not open any new credit lines during this period before closing... Is this true and if it is true when is it ok to get the credit. We need furniture and we want to finance half of it. Should we go the day we close lol and apply for credit, because i have also heard if the house TL showes up it could inhibit our credit worthyness lol... So my plan is to go tto the furnature sotre rite after we close... Does this sound good? I will be sure to read all the fine print in the financing agreement...

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We are deep! We close in 14 days, we have already had loan approval, and appraisal.

Ok i have a question, we were told that we should not open any new credit lines during this period before closing... Is this true and if it is true when is it ok to get the credit. We need furniture and we want to finance half of it. Should we go the day we close lol and apply for credit, because i have also heard if the house TL showes up it could inhibit our credit worthyness lol... So my plan is to go tto the furnature sotre rite after we close... Does this sound good? I will be sure to read all the fine print in the financing agreement...

I would'nt do ANYTHING until you are completley done with the transaction and the loan has funded, just to be on the safe side. ;)

Why take the chance?

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What does that mean lol? When does that happen when is the loan funded? Does it occur after closing before we get our keys? Or does it happen after we get out keys?

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What does that mean lol? When does that happen when is the loan funded? Does it occur after closing before we get our keys? Or does it happen after we get out keys?

It means that the funds have been dispersed. Usually a day after you sign/close. Your title co/agent/loan officer should keep you informed and give you confirmation when it funds.

Its different for refinance transactions, in that there is a 3 day recission period giving the borrower time to change their mind.

This does not apply to purchase transactions or investment properties.

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Hey, do what most firsttime homebuyers do. In 2005, for 8 weeks into my new house, I had two beach chairs, a cooler (full of beer), a TV, and a mattress.

It builds character. And certainly makes you appreciative of the simple things in life. :p

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We did that for a while when we first moved into our apartment we had bean bag chairs and out for furniture lol. We have most of the furniture. We are only looking to buy a Couch and a Bed room set... we have every thing else.

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I suggest just waiting for the loan to fund. I doubt the mortgage will show on your reports for at least a few weeks. I don't think mine showed for well over a month.

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Yeah it takes a while for the mortgage to show on your credit, and it will hurt your score by bringing down your over all age of accounts. I think your safe to apply after you close, since any new accounts will take at least a few weeks to begin reporting.

Eddie

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Ok so here is an update on our home purchase, so we close next Thursday in the morning. We start paying interest that day; well our realtor says she will not give up the keys until the next day I am tempted to send her a bill for the one day of interest that we have to pay with out living in the house because she will not turn the keys over until the day after. I am really just so disappointed in the Realtors involvement I am being picky an a$$

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I've only bought one home so I'm no expert, but I received my keys at closing. I thought that was generally how it was done. :confused:

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I've only bought one home so I'm no expert, but I received my keys at closing. I thought that was generally how it was done. :confused:

Me to

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Me to

Did your realtor give you a reason for doing this Shadow? I've heard of people writing something like that into contracts, like they will need more time after closing, etc. But if nothing is in the contract it seems odd to me. :confused:

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Did you realtor give you a reason for doing this Shadow? I've heard of people writing something like that into contracts, like they will need more time after closing, etc. But if nothing is in the contract it seems odd to me. :confused:

LOL She is a nut ball! If we were not so far into it i would crap can her and start over with out a realtor. Our mortgage guy does not understand why she is waiting till the day after, closing. The only think i can think of is something i read about, the deed going to the city for processing for it to be all official? "recording the deed" the artical says it should be completed by the escrow company on the day of closing. perhaps she does not realize we are closing in the AM lol!

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I think some states require that the deed is fully recorded before the buyer can take possession.

I wish I could remember which state in particular, but I just saw one of those shows on HGTV the other day that was done in a state that requires it, as they did not get their keys at close and the announcer explained that the deed had to fully record before they could hand over the keys.

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