Refinancing doesn’t save you money unless you calculate in the interest that you’ve already paid. Especially when you think you’ll own the house for the long haul or forever. If you pay $2,500 a month in principal and interest, you are going to pay $900,000 over the life of a 30-year mortgage. If you are 4 years into the loan and are going to refinance to a principal and interest payment of $2,800 you are going to save $200 a month, correct? Wrong! Read the rest of this entry »
This blog assumes you’re at the final steps of the mortgage process. You’ve completed your loan documentation, received your appraisal and title insurance, your loan is approved, and you have scheduled your movers. Now you’re ready for it to be over, but there is more to consider. Settlement day, a.k.a. closing day, can bring surprises and unexpected stress. Spend some time on these final closing details with a couple of tips that I give my clients on how to be prepared for the big day. Read the rest of this entry »
It is important to know how much a seller, or any interested party (i.e. a realtor, builder, or seller) can contribute to a buyer’s closing costs. Many people get confused as to what is allowed, and some realtors write up a sales contract with dollar amounts that are not allowed per mortgage guidelines, which will cause problems with the loan. Below are the current maximum seller financing contributions allowed: Read the rest of this entry »
I sometimes have clients ask me how they can reduce the amount of cash they need to pay towards the purchase of a new home. Recently a client who was making an offer on a house that had an asking price of $650,000 wanted to make an offer of only $600,000 figuring that since they were putting 20% down, they’d save $10,000 by paying 20% down on $50,000 less in price. However, the house is worth what it is worth, and Read the rest of this entry »
I have heard hundreds of times that people think they should settle at the end of the month to save money on the closing costs. They make it sound like you will save enormous amounts of money by closing at the end of the month. Everyone knows its true. I have clients whose friends tell them this, their neighbors and workmates also tell them. So it must be true, yes? It is not true. This is an old wives’ tale. What these people are talking about is the daily interest charge, also known as per diem interest.
The actual closing costs are no more expensive if you settle early in the month than if you settle late in the month. Read the rest of this entry »