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For over a year she has slept next to their home, and now her family opened the gate, to let her go

A Helpful Guide to Mortgage Closing Costs

Each and every mortgage loan comes with closing costs. These are associated with the legal and financial preparations for the property purchase deal and with inspections and insurance. As a home buyer, you should have a good understanding of these costs so that you can plan for them effectively. This guide is designed to help you get the main information and advice which you require.

Closing Costs Basics

The mortgage closing costs are incurred at the time of the initiation of the home loan and the purchase of the property. It is possible for them to be deferred in time, but this will come with financial implications. Statistics show that these costs are typically between 3% and 6% of the loan amount. They typically come to several thousand dollars and may go up to ten thousand and beyond if the loan is bigger.

It is important to note that these expenses can vary considerably based on several factors. The loan amount and the property purchase price are the main ones. However, the costs tend to vary from one location to another as well. They will depend on the general price level of the services in the area and on the price trends in the local property market as well.

The Main Costs

There are 9 major mortgage closing costs that a home buyer has to pay. The list includes:

- Application fees
- Origination fees
- Attorney's fees
- Appraisal fees
- Survey fees
- Inspection fees
- Title search fees
- Title insurance costs
- Recording fees

Only a few of these fees may exceed $1000. Most are typically way below $500. Still, these are just general figures to give you an idea about the amount of money that you will have to pay when you use financing to buy a home.

There are some additional costs to consider as well. The first one is the private mortgage insurance premium. You will need to pay the first installment right after arranging the loan. You will have to begin paying property taxes as well.

In many cases, lenders choose to be more cautious and require borrowers to place an amount of money corresponding to the insurance and taxation payments for the first few months of property ownership in an escrow account. That way, the lender takes care of the payments for peace of mind. The size of the escrow deposit depends on the loan amount, the property price and the individual requirements of the lender.

Payment Options

Typically, home buyers are expected to pay the closing costs out of their pocket. That is why they are advised to have sufficient savings before even making a home loan application.

Some lenders offer loans with no closing costs. These may seem attractive especially to home buyers with limited savings. However, this does not mean that the costs are actually not paid by the borrower. They are bundled into the loan. The lender can either charge a higher interest rate or add them to the principal. In any case, the payment of these expenses over the term of the loan will be much more expensive.

Finally, the most important thing for a home buyer is to ask the lender about the precise total mortgage closing costs and make a plan of how to cover them in advance.

Her life has been a living hell! Her body slowly deteriorating, her family opened the gate, to let her go for the last time. For over a year she has slept next to their home, in the bushes just outside never leaving.

Still watching her kids grow up. Not allowed to go into the gate. Now she is in horrific condition. She desperately needs a rescue and a foster! She needs urgent medical attention!

Edinburg, Texas
Transport available to Dallas

Please contact Leslie Hennings to arrange transport

STATUS : - read comment for update from crossposter
How to Get a Good Loan

When it comes down to loans, deal structure is incredibly important in terms of netting out and establishing your net proceeds. If at all possible, build the points on the backend of a loan, which means a higher interest rate. Of course, a higher interest rate is irrelevant since you may sell the home before you even make your first loan payment. Don't be surprised if this happens. This has happened to me on several occasions. More often then not, the first loan payment is due within thirty to forty-five days after having closed your property. If you can put your property under contract within two weeks, and you have a thirty-day escrow, you may technically be in a position-and this has occurred to me on three to four occasions-where you actually do not make a loan payment during your brief ownership period. It's an amazing feeling. I hope you experience it someday.

Now with the latter stated in terms of my innermost feelings toward loan points and prepayment penalties-since these are instruments of evil that are manipulated by unscrupulous mortgage brokers and lenders-I do have a positive story of a mortgage broker. In 2005, I received a tip from Fahali Campbell, a mortgage broker in Southern California. The tip was in connection to a small regional homebuilder, Empire Homes, based in Upland, California (Riverside County area) that was investor-friendly. Amazingly, with this builder I was able to put five homes under contract at $3,000 apiece for a total of $15,000. The total value of the acquisition was $2,030,000. The deal structure had all the hallmarks of flip methodology at its best: Riverside County location, long build-out, entry-level home product, low initial deposit, minimal design deposit requirement as well, $10,000 closing costs incentive, and a hot market. Long story short, when the five homes came online in February 2006, my net profit was $210,000 in just under four to five months of marketing.

Fortunately, as it turned out, Fahali was an exception to the rule when it comes to mortgage brokers. As a stand-up professional, his selfless disposition was appreciated. Maybe the fact that he played tailback in the Pac 10 for Oregon State in the mid-nineties had something to do with it, since it may have instilled a sense of fair play to others-I don't know. But I would certainly encourage those investors reading this article to seek out ethical professionals for your deal team. At the very least, your deal team should consist of a notary public that is prompt, a mortgage broker(s) that doesn't try to cheat you, a lawyer that doesn't double bill you, a home inspector that isn't in a rush, an escrow company that is biased in your favor, and marketing services (i.e., e-flyer, broadcast fax) vendors that are reliable. I have found throughout my real estate career that former athletes and ex-military tend to operate within a code of ethics, rectitude, and professionalism that sets them apart from others. Perhaps it's the experience of being out there on the field of play or the field of battle that constructs a mind-set that imparts the importance of helping others strive for success or survival, instead of thinking of oneself all the time-and that this mind-set translates into selfless acts for others.

Getting back to real estate, and now that we've discussed points, let's talk about prepayment penalties, another vital component of mortgage financing and many a cause of prospective deal breakers. As a cardinal rule, never get a loan with a prepayment penalty. Depending upon the size of the flip, conservatively speaking, this could add $7,000 to $15,000 in closing costs when you resell your flip property. And once again, when you close the property-and depending upon whether or not your property has gone up $30,000 to $60,000-a prepayment penalty will factor heavily into what your net proceeds are at the end of the day. Having a $15,000 God-forbidden prepayment penalty on a property that has only gone up $30,000, may in fact cause you not to close on that property, since netting only $15,000 on a flip is too thin of a margin to take a chance on. But if you've got a property where you think you might net $30,000 and the only loans that are available to are those with a substantial prepayment penalty, then very likely you may have to walk away from this property. In view of the fact of a $15,000 prepayment penalty on a $30,000 net profit, that 50 percent cut into your net proceeds is a deal breaker. I would not advise closing on this type of deal scenario.

These are the bits of minutia that you really have to be exceedingly and meticulously aware of on your loan product. You do not want to be stunned on this type of fourth quarter surprise when you are in escrow and getting ready to sale the property. In fact, you may want to even check the prepayment penalty language once again before you go to escrow to sign loan docs. This is advisable just to make doubly sure of the prepayment penalty you're getting or not getting.