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Answers (4)
- mslupea
- Contributions:1
Iam In the middle of closing escrow and had to pay $8,000 down and still a $3,535 closing cost with no lender credit and a GFE monthly payment of $1,070 for a purchase price of $165,240..... Interest rate of 4.250%....I feel I am paying too much but i had to pay $8,000 in order to get my loan approved since i had no savings......... Is there anything i can ask for to lower closing costs or recieve lender credit?
- Amy Prater, "Amy E Prater"
- Contributions:1
IF this is a MO property then the fees should be about $2200. This includes the appraisal, recording fees, underwriting fees, title company fees etc. If this is a KS property then you will pay a KS mortgage registration fee of about $485.00. These fees can be paid for by the seller. Your pre paid Items for the property tax and insurance can also be included in the "allowable seller paid closing costs" This amount will be determined by the quote for yoru home owners insurance and what the property tax figure is on the house. You can figure 2 months average on the property taxes and 14 average months on the home owners insurance. At closign the insurnace company would be sent the full years premium to cover you home onwers insurance.
- XanderTeam
- Contributions:27
I think the key is separate out the closing costs from the "guarantee fee" for USDA loans.
The guarantee fee for purchase loans is now 3.5% of the total loan amount. That needs to be looked at as the "penalty" for doing a 100% loan (just like PMI is the the penalty you pay for not putting 20% down). Fortunately, for USDA, this is cheaper that the typical PMI fees you would pay for a similar FHA or conventional loan.
Once you've separated that fee from the other numbers, closing costs on a USDA loan should be similar to any other loan program. A good "rule of thumb" is 2% - 3% of the loan amount and closing costs on the lower side (2% = ~$3600) would have a higher interest rate than closing costs on the higher side (3% = $5400).
Congrats on your first home purchase and be sure to ask enough questions so you understand everything.
The guarantee fee for purchase loans is now 3.5% of the total loan amount. That needs to be looked at as the "penalty" for doing a 100% loan (just like PMI is the the penalty you pay for not putting 20% down). Fortunately, for USDA, this is cheaper that the typical PMI fees you would pay for a similar FHA or conventional loan.
Once you've separated that fee from the other numbers, closing costs on a USDA loan should be similar to any other loan program. A good "rule of thumb" is 2% - 3% of the loan amount and closing costs on the lower side (2% = ~$3600) would have a higher interest rate than closing costs on the higher side (3% = $5400).
Congrats on your first home purchase and be sure to ask enough questions so you understand everything.
- Bryan Tobiason, "Bryan Tobiason"
- Contributions:1828
USDA Loans have a huge benefit of being a zero down loan, but that comes with a large up front fee. I did one earlier this year on $175,000 in Gardner and the closing costs were approximately 5% in total. The loan fees by themselves were approx 4%. This was my most recent USDA RD loan, and closest to your price range. But I've done several and it seems depending on the lender, time of year (for taxes) and loan amount the total can vary from 4 - 6%. If you feel you are being taken ask several other lenders for good faith estimates. You may be able to find a better rate or origination fee, but in my experience they tend to be pretty similar on USDA. Also, USDA can finance 2% of the closing costs & if the seller pays 3% then typically you'll come to the table with less than $1,000. Let me know if you have further questions or if I can explain anything in more detail.
How much is a reasonable amount to pay for closing costs on a $185,000 USDA guaranteed loan.
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