What Are My Closing Costs When I Buy A Home?

BOTTOM LINE - WHAT IS IT GOING TO COST TO BUY A HOME?

First and foremost- you do not pay the agent. The seller pays the brokerage fees.

Secondly, Down payment is different and completely separate from your "CLOSING COSTS". For example on FHA (most typical first time home buyer loan program of choice)...you (buyer) will be required to bring a minimum of 3.5 % of the sales price to closing as your down payment.


Now a buyer, who is financing the purchase by obtaining a mortgage loan, will have typical loan origination fees, escrows and closing fees better known as "Closing Costs." These should typically be 3% of the sales price (unless you are buying a home with high taxes)...if you find your closing costs are disproportionate...that may be a red flag that you are getting ripped off. Take note- It is to your advantage to get a Good Faith Estimate from SEVERAL mortgage lenders and let it be known to them that they are competing with the next guy. In fact, give them the Good faith estimate from their competitor to BEAT. Back to the topic, these closing costs will consist of loan origination fees, tax escrows, tax perorations, title insurance, home owners insurance, recording fee, closing fee & appraisal fee. So if you are following me, on a home purchase of $100,000, you will need $3500 down payment and you should expect to pay about $3000 in buyer closing costs.



This brings me to Seller Concessions. This is when you ask in your offer for the SELLER to pay your closing costs ....it is also termed seller concessions. This allows you to bring less money out of pocket to closing. But keep in mind, this expense is coming off of the seller's bottom line price. If you offer $100,000 and ask the seller to pay the maximum of 6% seller concessions that actually translates to only $94,000 on paper. That is before they foot the bill for the brokerage fees, transfer taxes and on and on.



This is important to remember when you find yourself in a tight negotiation situation like bank foreclosures that have multiple, competing offers. If you want the seller to pay your closing costs, in some markets, you have to inflate the asking price and put the closing costs on top. Ex. Hot property asking $100,000. You want seller to pay 6%. You offer them $106,000 with seller paying $6,000 in buyer closing costs. JUST MAKE SURE THE PROPERTY WILL APPRAISE!

Loan Program for Buyers

Greater Lansing, MI residents...if you are not a home owner, you should be. There has never been a better time to buy in Michigan. Historically low interest rates and home values makes your monthly payment peanuts compared to what you are paying in rent. Not to mention 2011 promises an onslaught of phenomonally priced bank owned homes and short sales coming down the pipeline.

  

Don't think it is possible for you? Do you hear about all this money, programs and grants out there available for home purchases and do not know where to find it!

Here is your Financing/ Available Buyer Program 101 Course:

  

Rural Development is still a Zero Down Loan Program. Bonus- This is not a Credit Score driven program, so you may still qualify if you have less than perfect credit history! Below is the RD eligibility area map. Anything in the yellow highlightedarea and beyond is an eligible area for Rural development financing.
Greater Lansing, MI residents...if you are not a home owner, you should be. There has never been a better time to buy in Michigan. Historically low interest rates and home values makes your monthly payment peanuts compared to what you are paying in rent. Not to mention 2011 promises an onslaught of phenomonally priced bank owned homes and short sales coming down the pipeline.

Don't think it is possible for you? Do you hear about all this money, programs and grants out there available for home purchases and do not know where to find it! Here is your Financing/ Available Buyer Program 101 Course!

Rural Development is still a Zero Down Loan Program. Bonus- This is not a Credit Score driven program, so you may still qualify if you have less than perfect credit history! Below is the RD eligibility area map. Anything in the yellow highlightedarea and beyond is an eligible area for Rural development financing.

Also plug in specific property address to the Rural Development site here: http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do

VA Loan- Zero Down Loan -Armed Forces Veterans and current Military Service Members are in a great position when they decide to purchase a home. They have access to Low Interest VA Loans that enable them to buy a home with no down payment and no mortgage insurance.

City of Lansing Down Payment Assistance- Assistance in the amount of 6% of the Sales Price is available to each income eligible household for down payment and reasonable closing costs incurred in the purchase of property located within the Lansing city limits.


Visit: http://cityoflansingmi.com/pnd/development/Dev_down_payment_assistance.jspF

FHA Financing- Minimum credit score is generally 620 middle score. Although there are lenders and program guidelines where this can be flexible. Minimum down payment required is 3.5% of the purchase price. Perhaps you do not have any money? FHA allows you to receive "Gift Funds" from friends or family for your down payment.

MSHDA Down Payment Assistance - This program requires a 1% buyer contribution of the total sale price. Available to households with up to $108K annual income (depending on family size and location of property.) Sales price limit of $224,500

Visit: http://www.michigan.gov/mshda/0,1607,7-141-45866_45870-175332--,00.html

• Zero-interest, non-amortizing loan with no monthly payments.
• Maximum assistance is $7,500.
• Available with MSHDA's FHA or Rural Development first mortgage.

Funds may be used for down payment, closing costs, prepaid/escrow expenses and a home inspection performed by a qualified home inspector.

Fannie Mae HomePath Financing / Buyer Incentives- Fannie Mae offers Rehab Loans on foreclosures that are distressed and do not qualify for traditional financing due to poor condition. They also offer incentives such as 2 yr home warranty, No Appraisal, No Mortgage Insurance and 3 % down payment, rather than the required 3.5 % for traditional FHA. Sometimes Fannie Mae will also contribute to pay Buyer's Closing Costs.

Visit: http://www.homepath.com/financing/index.html

Please contact MacIntyre & Cowen-REMAX Grand River, to get started. 517-999-2675.... Greater Lansing's # 1 Sales Team 3 years running. No one sells more properties in the area. Our knowledgable agents and friendly staff look forward to hearing from you today. We can provide you information and access to ANY home in the area. Visit us on our website at www.pmachomes.com and www.shortsalealley.com

1628 Bliss - Haslett Lake Access to Lake Lansing

Bank short sale.  Priced to sell now.  Right across from Lake Lansing in the Haslett School District.  3 bedroom, 2 full bath with large open floor plan.  1st floor laundry, master bedroom...everything is on one level.  Very nice deck, raised patio in the back for summer BBQ's and entertaining.  Lake Access.  Full basement, pour walls and it can be finished for much more square footage if desired.  This is a great opportunity.

Lansing MI Realtor Helps Fight Crime!

Recently the MacIntyre & Cowen- The REMAX Grand River Real Estate office in Lansing, MI was contacted by the Lansing Police Department to gain access to one our vacant listing in Lansing's Southside. Needless to say I was skepical when I received the call. After checking with the absentee owner and checking that everything was on the up and up, our office agreed to give exclusive access to property to the local authorities. The intended use was for a one week stake-out to catch an alluding felon. Lansing police had received a tip that a man who had escaped from custody in August, and had numerous weapons charges outstanding, was hiding out in a nearby home. Police considered the man armed and very dangerous The police were able to set up survelliance and collect intel to bring down the criminal at large. Late last Thursday night, after a two hour stand off, the fugitive armed with an assault rifle and wearing a bullet-proof vest, was captured.

The MacIntyre & Cowen Remax Grand River office was honored by the Lansing Police Department with a visit to the office and a gift of gratitude for our cooperation and assistance in the matter. Peter MacIntyre and Eleanor Cowen, Associate Broker/Owners were thrilled with the result. Pictured is the MacIntyre & Cowen office staff. Visit the website at www.pmachomes.com
 
The MacIntyre & Cowen Remax Grand River offices are located at 2824 E Grand River Ave Suite C & D  Lansing, MI 48912