My husband and I have been approved for 100% financing to buy an new house. We don't have any money for the

closing costs. This is both of our first time buying a house so I'm just a little confused. What is the closing cost for? How can I get money to pay that? How much does it usually cost? Sorry if I sound ignorant, but I need some help.My husband and I have been approved for 100% financing to buy an new house. We don't have any money for the
Your best option is to ask for what is called a seller concession or seller contribution. This is where you place in your purchase contract that the seller is to pay a certain amount or percentage for your closing costs. A 3% seller concession is normally good for most situations and 3% is normally the most that most lenders will allow you to receive in acceptable contributions on 100% financing. Normally, this is worked into your purchase agreement when you are bidding on a home and your Realtor or your mortgage agent should have let you know about this option. If you already have a purchase contract in place, don't worry, talk to your Realtor and let them know that you need a seller concession. Chances are it will not be a problem to work it into the contract still at this point. You will most likely just end up financing a little more. See the link below for more information on seller concessions.My husband and I have been approved for 100% financing to buy an new house. We don't have any money for the
I work with loans like this all the time, and really, these are becoming the norm. I won't tell you that you're not ready to buy the house if you can't pony up money at close, but I will tell you that if you're going conforming, depending on how the purchase agreement is set up, you can have the seller pay 3% of the loan toward closing costs. 6% if it's My Community. Now, the bad part of this is, since you're going into this at 100% LTV, you're setting yourself up for a hard time ahead for refinancing your mortgage, because we're in a market of declining property values. They will go up in the long run, as housing always has, but for the short term, it will drop. Now, 100% financing isn't a good idea, but it gets you into the house, and if it appraises for significantly higher than what you bought it for, you only have to wait 6 months to refinance and lower your MI factor.
have the closing cost figured into the loan which i did and that helped me a lot ! Whoever aproved you for the loan should have told you about that option!
Closing costs are fees that you and the seller have to pay. There are buyer-paid closing costs and seller-paid costs. Examples are appraisals, loan origination fees, points, surveys, pre-paid taxes, etc. Usually between $1,000 and $5,000.





Your lender can definitely offer you some options to have low closing costs. You can borrow additional money, or the lender can charge you a higher APR (which means higher monthly payments). Try and think of it as a sliding scale. You can choose to have higher closing costs and a lower monthly payment or, in your case, lower closing costs for a higher monthly payment. One way or another you're going to have to pay for these fees.





Be careful. Your additional expenses will add up faster than you could ever imagine. I recently bought my first home. It will suck money out of your wallet like its a black hole. $600 trips to the Home Depot are a weekly occurance. I bet I spent close to $15k in the first 2 months. Make sure you account for this when you are budgeting.





Good luck!
I am a certified Mortgage Planner.





Are you pre-approved or pre-qualified? Completely different animal.





While I don't necessarily agree that you are sub prime waiting to happen, since there are few sub prime lenders out there doing 100% financing anyway unless your scores are really high, you are a risky for a lender.





Here is why. Since you are ';approved'; for 100% that means you can include your closing costs into the financing using something called sellers concessions. You are allowed (by the seller and the lender ) to have up to 6% of the purchase price added to the home price to cover costs. It must be included prior to submitting your loan and the home must be able to appraise and the MLS listing must not be more than the whole cost. Are you confused yet?





You need to sit with a mortgage planner (not an LO or a bank) and plan how you are going to do this. You need to understand the 3 C's (capacity - what you can really afford, credit - what yours looks like and how you can improve it if needed, and finally collateral - the homeyou can afford).





You need to know this before you make a huge error and it ends up costing you something you really want a home.





As far as how much are closing costs, depends on the loan you are looking at. Average costs range from 3-5% of a purchase price (they can be higher - don't freak yet).


Closing costs consist of the the planners fee (mine is 2%) the lender can pay a portion of this. Credit report fee, flood cert, prepaid interest, lenders fee, title insurance, recording fees, brokers fees, application fees, on and on.





This is purely my opinion, take it for what it is worth - it doesn't sound like you are really pre-approved for a mortgage. You should know alot of this already. You should have received a package of papers to look at and sign. Included in this is a Good Faith Estimate of costs. A Truth in Lending which details rates and APR. And a whole lot more.





I would like to talk to you - to find out if there is anything I can do to help in finding you someone in your area that can really help you. I am happy to be a resource for you. I may not be licensed in your state currently(I don't know where you are) but I have done loans in 46 states over my career. You can reach me anytime


Nichole


517-749-0961


nichole@help2buyhomes.com
Sounds like you aren't really ready to be buying yet! If you can't come up with closing costs, what will you do when you move in and have repairs? Sounds like you are stretching things to tight!
The closing costs are all the fees your financier is going to charge you. Things like the title insurance, appraisal, etc. It will also include insurance and taxes usually. Some financiers will allow you to roll these into your loan but it's getting harder to find them now with all the housing troubles. My advice to you is rent for now and let the housing bubble break even more. Prices will come DOWN. Save now and buy more house later.
Hi ';Amie g';





Don't know if this answer has been given previously, but closing costs are the costs paid by either buyer or seller at closing. (1) Closing costs are for such items as the realtors commission; points associated with the mortgage; taxes; notary fees; document preparation, etc. (2) Some sellers are willing to contribute to the buyers closing costs; Also you may be able to get a relative to gift you some of the funds (cannot be a loan) (3) Costs varies - you may want to ';estimate'; at least one percent of the total price of the home (i.e., home price: $200,000. / Closing costs: $2,000.





finan7
Actually, you're NOT approved for a loan at present. Part of the funding process will include the underwriter verifying funds for closing costs. If you don't have those funds available, your loan will NOT be approved and the sale will fall through.





It sounds as if you have been ';pre-approved'; or ';pre-qualified'; for the loan. Neither of those obligates the lender to go through with the loan. Once it becomes apparent that you don't have the funds for closing, that pre-approval will dry up faster than an Englishman's humor at a celebrity roast.
Closing costs cover the costs associated with the transfer of the home and the writing of the mortgage note. This includes attorney's fees, notary fees, title fees, points that you are paying for a lower rate, application fees, copy %26amp; courier fees, etc.





Honestly, I'm surprised that you received 100% financing. That's next to impossible these days. Someone else had talked about ';rolling it in.'; I suppose if you can still get 100% financing you can try for the 104% to cover the closing costs. Regardless, they need to be paid. Just remember that you'll be upside-down in your equity.
Ask your bank if you can roll the closing costs into the cost of the home. The closing costs will be a percentage of the cost of the home. Ask the lender for a 'guess'. 5% sticks in my mind, but I could be 'off'
Closing costs are basically paper work costs and can be waived or rolled into a mortgage. You sound very new to this so I would suggest a few things be checked.





1) Bank vs mortgage company. Banks are stricter but cheaper. Mortgage companies can be notorious for taking risky loans and will ask what they think you will pay not what they can give you, so you have to negotiate with them. You have to know where you stand before accepting their offers.





They have been known to send blank loan sheets and up the percentage, sell mortgages, demand in full etc





2) Some mortgages allow you to pay more towards the amount owed while others will allow you to only pay more to next months mortgage.


Being allowed to pay more to the amount owed is critical, as it reduces the total amount paid in the end. Example. If you pay 10$ extra now, thats 30 years of intrest you wll save on that $10 could save you $50. On mortgages that dont allow that you will have to pay the full amount, the extra money down will only end your payments early and make them happy





You want a buy out option so that should you inherit money you can pay the value of your mortage with out the intrest. If you pay it off now why should you give them the extra 200% of intrest?





You want to be sure they are locked in also so they can not bump you out if rates go up and you are paying a low rate.





Investigate now.
The closing costs are for the lawyers, appraisals, loan fees, taxes. Things like that. There are a lot of grants and stuff out there. Check with your states government and see what they offer. The amount of the closing costs depends on the price of the house. They can range form 1000 to 7000. Check with your loan officer, they can give you a rough estimate of what they are going to cost.
Usually the seller pays closing costs, but you would negotiate that into your agreement.





Honestly, though, if you can't afford a few thousand for closing costs, then you have no business buying a house. You'll have to pay for your 1st year's worth of insurance all at once BEFORE closing, and that'll be over $1,000 alone, plus you'll have inspections.





I bought my first house with 0 down. I had about $15,000 saved up, and with insurance, inspections and improvements, I blew through that in a couple months.





You should have SOMETHING saved before you buy a house.
Your loan officer should be the one coaching you through all of this.





Closing costs pay your mortgage company for creating the loan, pays the title company to assist with transferring the deed and performing the closing, and the state gets their hands in the till with some taxes and fees.





Your best bet is to negotiate your purchase to have the seller pay your closing costs for you. Your loan officer should be able to tell you what the costs are, at least a good estimate. Then get your realtor to build that in to your purchase offer.





Easy example: You find a house for $200,000. Closing costs at $200K are about $6K (probably about right). You offer to buy the home for $206K, with $6K in seller-paid costs.





You can literally buy the home with no money out of pocket.
CLOSING COSTS ..GOSH .I HAD A MORGAGE ONCE .. I THINK IT COSTED ME 20% OF THE HOUSE AND I HAD TO PAY THE FIRST YEAR IN TAXES BEFORE I COULD MOVE IN... ALSO THE LAWER WAS AROUND 600 HUNDRED ...IT WAS MORE THEN I EXPECTED
Sounds like you're a sub-prime loan waiting to happen. I'm not trying to be mean, but if you have to get 100% financing and you don't even have money saved for closing costs, then you aren't ready to buy a home. There are a lot of costs that will come up that you aren't prepared for.


Plus, if guarantee the loan you are getting has horrible terms. Think about it- you default on the loan in a few years and the bank gets the house including any equity you've earned.


BAD IDEA
The people who have answered above me have obviously been poorly represented by a Realtor. Don't freak out.





When you find a home you can ask for the sellers to pay your closing costs in your offer. You may have to offer slightly higher than what you would offer normally to offset it. For example - If the home is on the market for 200,000 and assuming it is priced in line with similar homes you can offer 195,000 and ask the seller to pay closing costs and prepaids. This is done frequently.





If you don't have an agent yet, shoot me an e-mail and I will find you a great one!
Closing costs are generally 2% of a loan value. If the percentage is higher, someone is jacking you, shop around for better terms. Costs covered are title insurance, fees to everyone and their mother and escrow for insurance %26amp; taxes.





In a soft market, you could ask the seller of the property to pay your closing costs when you make an offer. Say you plan on offering 10% less than asking price, go 5% less and seller pays closing costs.





Another option is to roll the closing costs into the loan amount: this is not as good of a deal for you. Your loan will be for more than list selling price and eat up any equity you have.





A better question: if you have no $$$ can you afford a house? Could you write me a check for $1000 without killing yourself? If not, how would you pay for a new refrigerator or furnace if it broke down? You may want to get in a better financial spot before buying. Good luck.
My wife and I ran into the same situation a few years ago. You can borrow up to 104% of the value of the house you are purchasing and set up the purchase/sales agreement with seller paid closing costs. The offer you make to them would go up by the estimated closing costs. They wouldn't get the extra money as it would be put towards the closing costs. The closing costs cover things like lawyers fees, title work and other random things. Hope this helps.
well if you approved for a 100% financing and dont have money for closing cost heres a lil thing you can do. depending on where you live here in califorina we have this new program that offers you 20% down if you cant get 100% finance. if you only need closing cost fee's they can help you pay for that as well the only prob is if you decide to sale or take money out of equity from the home they will be asked to pay them back if you dont do so with in 15 years then you dont have to pay them back at all.. look into fha loan