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user106552

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Settlement in MD - Does buyer lose conrol of money wired to settlement agent?

Answer

Thanks Bridget. My bank tells me it will take 2 days for wired fund to get to the destination, so I will wire it no later than Wed for Friday's settlement. 2 days seem too long...but it's probably their worst case scenario. I am still not fully clear on what is the status of the money that's wired over (can be released to me without seller's consent or not), but the deal has gone forward without slightest complications so far, so I will not worry about having to recover the money...will ask the settlement agent at the settlement what the real deal is...for future reference.

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Settlement in MD - Does buyer lose conrol of money wired to settlement agent?

Answer

Thanks all for the replies. They are not necessarily asking for money today, but they (settlement company) say that since it takes some time for the check to clear (even if a certified check), and the closing is happening late Friday, they want to avoid issues by having the money wired over no later than one day before the closing.So if I understand you all correctly, seller has a say on disbursement of *any* money I send to the settlement agent?I say "any" money, because I would have thought (hoped) that there is a distinction between the earnest money they are holding...that I sent as a part of the offer, vs. any other money I send them to get ready for the settlement. The latter, I would have thought, I would retain exclusive right on, till the time/day I authorize the settlement agent to disburse it. Well, that's the way I would set set this up any way.I don't even remember if I signed any contract with the settlement agent and if it explains my relationship with them. Probably not...the contract signed with the seller probably has applicable language. Gotto go re-read it.I'll find out from my banks what's involved in wiring fund/how long it takes, and wait for the HUD-1...and wire the money not too soon.

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Settlement in MD - Does buyer lose conrol of money wired to settlement agent?

I have settlement in 10 days on a house I am buying in Maryland . I have been asked to wire the closing cost (minus the earnest money) to the settlement agent, instead of taking a certified check to the closing.Enter nervousness. With a check, I would have control of the money until I hand it over at whatever point at the settlement. If I wire the money over now, under what terms does the money stay with the settlement agent? Yes, I could ask the settlement agent, but I would like to hear independent opinion. If something goes wrong, do I still have control of the wired money? I know the contract terms will dictate who owes what if something goes wrong, but regardless do I surrender legal control of the money once I wire it over? Are they merely holding it for me to be used in ways I permit them to, or are they allowed to say...well the contract says...I'm new to MD and I don't understand the idea of the settlement agent "representing the contract"? What does that mean? Why does the contract have a representation and not the guy forking over the money? I am used to having a lawer represent me and only me on a real estate transaction.Inspection and appraisal went ok, and the loan process is almost done, so I don't expect any roadblocks to a closing, but I don't like parting with a large chunk of money without knowing the ramifications. Thoughts?

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Mortgage scenario. 750k house, got 75k cash, MD

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True Norm about agents signing away 1st time buyer's rights.After referring to the relevant code section numbers and stating what they say, my contract immediately adds an exception saying something like "AS IS CUSTOMARY, seller and buyer will split the cost of tax and recordation". I should have read the contract more carefully and pushed the agent.Clay,You're the third person to say terms are too good to be true. I will either come back here gloating or crying in a few weeks.As I said my relative (who is a penny pincher like you've never seen before; that's probably why he now owns 7 properties after starting from exactly zero wealth and a regular job 15 years ago)...this relative has used the banker/bank multiple times, so I am not hitting the panic button on this one.

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Mortgage scenario. 750k house, got 75k cash, MD

Answer

Original poster again. county tax 3,475; state recordation 2,528; origin. fee 865Monthly payment: 3,347 = 2,853 (P+I) + 419 (Tax) + 75 (Hazard Insurance)Closing Cost: 10,868 (Origin. fee 865, Tax/recordation around 6,000 )Prepaid, Excrows: 5,590The tax amount in monthly payment is based on assessment before 1.5 floor was added to the house last year, so it will likely go up by 100 or 200, so you're right about the monthly payment being close to 3600.---About why the taxes/recordation portion of closing cost is low.Just reread the contract, and this is what I have to say to all of you loan officers out there: Know the rules of the state/county where the property is, or your quotes may unnecessarily look uncompetitive to buyers.MD has special breaks for first time home buyers. State Transfer Tax is halved to 0.25% [ Section 13-203(b) of Tax Property Annotated Code of Maryland ], and is to be paid by the *seller*. County tax and recordation tax is to be paid by the *seller* [ Section 14-104(c) of Real Property Article ]. Isn't that sweet?Lows do allow for mutually agreed exception to seller paying all of this, and it turns out in my contract I'm splitting the cost half and half with the seller. If I had known what the laws say (or rather, recommend), I would have pushed to have sellers pay the cost.

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Mortgage scenario. 750k house, got 75k cash, MD

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Original poster here. Got a very good deal from a local bank:I'm buying a 695k property with 10% down. Got lucky, as the loan amount, 625.5k is the max they would allow for the terms I got, which are:30 yr fixed, 3.625% interest rate, 0 point, no mortgage insurance (not up front, not  monthly). After taxes and hazard insurance, monthly payment comes to around $3350. Closing cost is around 16k. I also had the option to have 3.75% rate and around 3k in credit, but I chose the lower rate.Inspections done, waiting for appraisal.Thanks to all who responded. I am glad to give my business to a local bank. Two other lenders I talked to said the terms appear too good to be true for 90% LTV, but I am not worried as the bank and the banker came highly recommended by a relative who owns multiple properties and has used the bank (Eagle) and the banker many times.

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Mortgage scenario. 750k house, got 75k cash, MD

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Thanks all for your input so far.Here are two options I have been quoted for a 750k house in montgomery county, MD. Please let me know if these are reasonable:1) FHA30 YR fixed loan at 3.5%, 4.49% APRLoan $722k + Cash at closing : $40k down+$12k closing costMonthly payment: $4800 ($3250+ $1550 for PMI, taxes, hazard insurance)2) Conventional 80/10/1030 Yr Fixed at 3.5%$600k conforming Loan + $75k down + $75k second loan + $20k closing costMonthly payment: $3950 ($2700 + $500 for 2nd loan + $750 for taxes hazard insurance)Second loan for $75k is at 6.99%, 10 Yearr ARM, floats after 5 yearsCash at closing with this option: $75k+$20k, so I will need to borrow $20k from 401k accountAm I getting reasonable deals?One last question. With #2, I have been given the option to add the $20k to the loan to avoid borrowing from my 401k account. If I understand how this works, the purchase price is inflated to $770k from $750k.I was told seller gets the same net amount so they don't care, but I have also been told that it does affect the seller. Does this option make me a less competitive buyer in seller's eyes?Thanks.

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Mortgage scenario. 750k house, got 75k cash, MD

Answer

If I understand the gurus,  FHA loan is the way to go, because at less than 20% down (I have 10% cash, but after paying closing cost, there will be less than 10% left for downpayment) and at the loan amount I mentioned , I can't have a conventional loan?

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Mortgage scenario. 750k house, got 75k cash, MD

Hi folks,I'm looking for a single family house in Montgomery county, MD for around 750k. Got 75k cash for closing, good credit history for both spouses (750-760), two car loans (total 550/month), stable jobs, good current income (total 185k/year; was lower previous years, around 150k).What kind of mortgage/rate can I expect?

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