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pre-qualification question

I keep seeing different prices posted.  I am told that these prices that zillow is posting does not include mortgage taxes and insurance
  • June 25 2010 - Otter Creek Crystal
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Answers (1)

What 'prices' are you refering to? If it's monthly payment, then you are correct. They don't factor in property taxes and insurance. In addition to that, Zillow uses their own criteria for the base loan and rate, which may be completely different than that which you will be using, so the monthly payment that is shown really has no bearing on anything.  To determine your total monthly cost, you will need to take 3 steps:

1) Determine your monthly mortgage payment - If you've been pre-qualified, you should have a pretty good idea what your rate will be, and the amount the lender will require down on your mortgate.  Either have your lender work up the monthly mortgage payment for you or use an online mortgage calculator to determine what the mortgage payment will be. 

2) Determine your property tax monthly average - You will need to look at the individual properties, determine their annual property taxes, and divide by 12. That will give you your monthly tax debt. Property taxes are different on every house, so you will need to do this on a house by house basis.

3) Determine your monthly insurance costs - This too will depend on the house, but if you're looking in a specific price range, it won't vary too much.  Call your local insurance agent, explain to them what price range your looking for, and ask for a rough estimate on what the costs would be.  They won't be able to give you a specific number, but they should be able to give you a pretty decent idea of about what to expect. Break the cost down into a monthly figure.

Add up the 3 numbers and you've got a pretty decent idea of what your overall monthly payment will be. Some people will escrow funds and have payments distributed automatically by the bank; others will pay the taxes and insurance out of pocket when the bills come due. Either way, it's best to know what the breakdown is on a monthly cost basis, so you don't get caught off guard when the bills come due.

  • June 25 2010
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