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Replies (9)
- wetdawgs
- Contributions:26804
The lender's gift program is being subsidized by you over the next 30 years. You would be losing $$$ big time taking their offer.
It is not unusual for short sale lenders to refuse closing costs etc. They are losing their shirts already, don't want them to lose their underpants. Why don't you do it the traditional way and pay your own down payment and closing costs?
It is not unusual for short sale lenders to refuse closing costs etc. They are losing their shirts already, don't want them to lose their underpants. Why don't you do it the traditional way and pay your own down payment and closing costs?
- Randy Hooker, "GoingForIt"
- Contributions:395
I'm reading between the lines here, but it sounds like you don't have the funds to pay your down payment AND closing costs? Correct???
My first question is why you would enter into a short sale contract/situation having less than the cash needed to finance it? Short sale lenders are notorious for refusing to pay closing costs, as wetdawgs already stated. So in addition to the fact that the overwhelming majority of short sale listings never make it to closing, the problem is exacerbated by a listing agent who is apparently inexperienced, as well as your buyer's agent (if you are using one) who is inexperienced. Oy...
Best advice I can offer you is to contact another local (Phoenix area) lender, and see if they can offer you any better rates and terms on the loan. If you need a referral, just let me know.
Best of luck!
My first question is why you would enter into a short sale contract/situation having less than the cash needed to finance it? Short sale lenders are notorious for refusing to pay closing costs, as wetdawgs already stated. So in addition to the fact that the overwhelming majority of short sale listings never make it to closing, the problem is exacerbated by a listing agent who is apparently inexperienced, as well as your buyer's agent (if you are using one) who is inexperienced. Oy...
Best advice I can offer you is to contact another local (Phoenix area) lender, and see if they can offer you any better rates and terms on the loan. If you need a referral, just let me know.
Best of luck!
- Jeff Masich, "Arizona Homes Land"
- Contributions:508
Dear Wenn:
If you need some help with the down payment, maybe this short sale is not for you. Many bank owned homes will pay for the closing costs (Fannie Mae for example). Also, in certain zip codes the Arizona Department of Housing provides grant money for up to 22% of the purchase price for the purchase of a bank owned home.
To get the best interest rate, a higher down payment and high credit score really help.
If you love this particular short sale home, this may be an issue however. May I wish you the best.
Regards, Jeff
Jeff Masich, Realtor
HomeSmart
Scottsdale
If you need some help with the down payment, maybe this short sale is not for you. Many bank owned homes will pay for the closing costs (Fannie Mae for example). Also, in certain zip codes the Arizona Department of Housing provides grant money for up to 22% of the purchase price for the purchase of a bank owned home.
To get the best interest rate, a higher down payment and high credit score really help.
If you love this particular short sale home, this may be an issue however. May I wish you the best.
Regards, Jeff
Jeff Masich, Realtor
HomeSmart
Scottsdale
- Andrew Adams, "203K Specialist"
- Contributions:9349
FHA has a minimum cash investment of 3.5% that has to come from the borrowers own funds. They do allow the borrowers own funds to be gifted to them from a family member but no such program as FHA 1% down program. Your lender is selling you an apple...but calling it an orange!
Who is providing the 2.5% gift for the program? The Lender can't so the 5.75% rate is likely covering the closing costs and pre-paids and you are putting 3.5% down.
Who is providing the 2.5% gift for the program? The Lender can't so the 5.75% rate is likely covering the closing costs and pre-paids and you are putting 3.5% down.
This doesn't seem to be a good deal. Look for other lenders to see what they have to offer in terms of interest rates and loan conditions. Most of the lenders do not bother to pay the closing cost. Also more is the downpayment, less will be the interest rate.
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- Clay Branch, "Georgia Loans"
- Contributions:7835
Johnson, the rate on FHA wil be the same if they put down more money. BTW, could you convert those pounds into dollars on your payday spam page so we know how much money we can borrow til payday?
- Jeff Star, "ShortsaleAgentofAZ"
- Contributions:967
I do a lot of short sales and 90% of them buyers ask for closing cost and we always get the short sale lender to pay up to 3%, but if the short sale is a existing FHA loan the short sale lender will only pay 1% of the purchase price toward buyer closing cost. That is FHA rule.
- Lisa Jordan, "Lisannem"
- Contributions:6
I work for the company that offers this program. For people who don't have the money for a downpayment (and the seller will pay the closing costs) this is a wonderful program, but in your situation, because you're going to have to put money into the transaction anyway, you would probably be better off applying the money toward your downpayment. Just ask your loan officer to take a look at this again.
While looking for a lender, focus on the interest rate, the credit amount and the time for paying off the loan. Most of the lenders do not pay the closing cost. Also focus on improving your credit score. You can improve your credit rating by making all outstanding payments and dues. Gradually, your credit score will improve. A good credit score speaks your creditworthiness. Make sure you do not owe any taxes.
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FHA 1% down and closing costs
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