Skip to main content

FHA loan, closing costs really high

Hi all. My wife and I just got done with inspections on the house, the price is 353k(single family home) with 3.5k down. But now looking at the cash the close I am confused. My lender showed me two options, one where he would include the PMI in the loan and one where the PMI is in the closing cost. But in these both scenarios I see the PMI being in closing cost so I will give a breakdown to see if you guys can understand it.

 1st scenario 2nd scenario

Purchase price. $353k. $353k Loan Amount. $346k(PMI in Loan) $340k

Closing Costs A. Lender Costs. $1089. $1089 B.(includes PMI) $7654. $7654 C. $1384. $1384

D.(total loan cost) $10,127. $10,127

E. Taxes. $164. $164 F. Prepaid. $3,443. $3443 G. Init escrow. $4,350. $4350 H. Other. $415. $415

I. Total other cost. $8,372. $8,372

Total Closing cost. $18499. $18499

Cash to Close

Closing Cost. $18,499. $18,499 Down Payment. $6,395. $12,356 Earnest money. -$2,100. -$2,100 Seller Credits. -$8,500. -$8,500 Other Credits. -$1,800. -$1,800

 Total. $12,494. $18,455

Now my question is, why the PMI ($5961) is included in both closings costs when one is including in the loan? Why do I need to put 14k down instead of 3.5% down? Isnt 5.5% closing costs seem too high?

submitted by /u/knigh_trider
[link] [comments]

source https://www.reddit.com/r/RealEstate/comments/1172ho7/fha_loan_closing_costs_really_high/
Labels:

Comments

Post a Comment

Popular posts from this blog

Aren't comps/CMAs useless with buyer credits at close happening now?

I'm looking into buying a new construction townhouse in my HCOL US city. I'm seeing builders offering interest rate buydowns worth $20k-$60k on $800k homes (rather than just lowering prices) in order to keep their comps high for their other units, now that buyer demand has been declining. I asked my agent about these, and he said these buydowns aren't even the full story: buyers can write all kinds of other credits into an offer, like their closing costs, prepaid sewer fees, etc. Apparently cash buyers can just write in a "buyer credit at close" for any amount in their offer. So a new townhouse that appeared to sell for $800k in the MLS might have actually been a cash offer with a $100k+ buyer credit at close, meaning the buyer only spent $700k or less in total, but to the rest of the world they can only see the $800k! So that made me realize I can't trust comps/CMAs for other new construction townhouses. The sales prices could be way lower than they appear...
1 comment
Read more

How to Avoid Property Scams in Delhi?

Here’s What You Should Know! Commercial Real Estate (Non-Residential) Buying a property in Delhi can be tricky, especially with all the stories about scams and shady deals. If you're in the market, here are some tips to keep yourself safe:Double-check the documents: Always verify ownership and approvals. Don’t just take someone’s word for it—look at the actual papers. Do your homework on prices: Compare similar properties to avoid overpaying. A little research can save you from a bad deal. Work with trustworthy people: Whether it's a seller or an agent, go for someone who's transparent about pricing and the process. If they’re dodging questions, that’s a red flag. Ask for reviews or references: If someone you’re dealing with has a good track record, they won’t hesitate to share testimonials or connect you with previous clients. I’ve noticed that some property services have started focusing on things like verified listings and clear communication, which makes the whole proc...
Post a Comment
Read more