I'd be leery of any closing cost quotes. I have never gone to a closing and had the closing costs really be what any of the quotes said. The first house we bought, we had to scramble up $2400 at closing. The most recent house we bought, we had $5000 come back to us unexpectedly. Be sure you are prepared with enough money to close, or you might lose the house & your earnest money at closing.
Has the house been appraised yet? Has your loan been sent to underwriting yet? There is a difference between approval & preapproval, preapproval boils down to meaning essentially nothing-they "think" they can get you a loan. If the house appraises for more than your offer, you can often finance the closing costs into the difference.
You can also make a higher offer asking the seller to pay your closing costs in full. So say right now they are paying half your closing, but you need come up with $4000 more. Well, revise your offer for $4000 higher, but asking the seller to pay that additional $4000 in closing costs. Essentially, you are financing your closing costs over 30 years....which is going to cost you, unless over teh next few months you pay down that $4000 in principal. Sellers like to do this though because it doesn't cost them any more money, but it makes their house sell price higher. Agents like it because it gives them more money in realtors fees (which you don't have to pay) and in a buyers market right now, it will help keep home prices from dropping dramatically, which keeps your house holding its value a little longer if the market tanks.
Also, your broker should know all the tricks about closing costs. Tons of people have no money for closing costs at all, and there are a lot of tricks to get them paid for without out of pocket at closing, including closing costs loans, financing in closing, and what I described about raising your offer to include closing. Either way you have to pay it, and paying it over 30 years or on a second mortgage at higher interest will cost you, so you will need to decide if you can really afford this house.
A fixer upper is also probably going to cost you a lot more in the long run than you think. We had a house that was 30 years old but in really good shape, and we spent on average $200/month on repairs & maitenance for the 5 years we lived there. We just bought a newer home, and so far have spent $50 a month on maitenance and no repairs. Huge difference, and the new house is 3 x as big!
A house already classified as needing repairs/remodel should be something you can buy for much much lower than the market value for you to be able to recoup your costs on a remodel when you eventually sell. Also, its a buyers market right now, so if you do have to wait, chances are it will still be available a few weeks or even months from now.
Has the house been appraised yet? Has your loan been sent to underwriting yet? There is a difference between approval & preapproval, preapproval boils down to meaning essentially nothing-they "think" they can get you a loan. If the house appraises for more than your offer, you can often finance the closing costs into the difference.
You can also make a higher offer asking the seller to pay your closing costs in full. So say right now they are paying half your closing, but you need come up with $4000 more. Well, revise your offer for $4000 higher, but asking the seller to pay that additional $4000 in closing costs. Essentially, you are financing your closing costs over 30 years....which is going to cost you, unless over teh next few months you pay down that $4000 in principal. Sellers like to do this though because it doesn't cost them any more money, but it makes their house sell price higher. Agents like it because it gives them more money in realtors fees (which you don't have to pay) and in a buyers market right now, it will help keep home prices from dropping dramatically, which keeps your house holding its value a little longer if the market tanks.
Also, your broker should know all the tricks about closing costs. Tons of people have no money for closing costs at all, and there are a lot of tricks to get them paid for without out of pocket at closing, including closing costs loans, financing in closing, and what I described about raising your offer to include closing. Either way you have to pay it, and paying it over 30 years or on a second mortgage at higher interest will cost you, so you will need to decide if you can really afford this house.
A fixer upper is also probably going to cost you a lot more in the long run than you think. We had a house that was 30 years old but in really good shape, and we spent on average $200/month on repairs & maitenance for the 5 years we lived there. We just bought a newer home, and so far have spent $50 a month on maitenance and no repairs. Huge difference, and the new house is 3 x as big!
A house already classified as needing repairs/remodel should be something you can buy for much much lower than the market value for you to be able to recoup your costs on a remodel when you eventually sell. Also, its a buyers market right now, so if you do have to wait, chances are it will still be available a few weeks or even months from now.
The money from the trees will be enough to pay our down payment and closing costs. Now the 3-4000 that I save in the next couple of weeks will go towards stuff I want to do to the house and savings. I have $800 already and all the bills are paid and money set aside for expenses so for all of October (except the last check) the money can be saved. I'm so excited. Hopefully sometime this week we'll be able to settle on the exact sale price and offer! I CAN GET A NEW HOUSE! No more malfunctioning falling apart trailer!
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