August 9, 2019 at 8:00 pm #50664Perkins5Member
So i received my initial closing disclosure today and I am a bit disappointed. I’ve paid ultimately $4,300 through NACA, and just talking to my mom and reading online it seems I’ve could have gone a different route that was possibly quicker, just as cost effective, and less stressful. also the whole conventional vs FHA loan comparison.
I could obviously still pull out but i would lose out on $1,500 and a good home. I think I’m more frustrated that I didn’t understand what would be needed at closing. My loan estimate went from -$300 to $1200 to $2800. It’s my responsibility to do research but I just heard good things about NACA and this being my first home I just dove in head first and didn’t check out other Lenders or properly research costs at closing.
I”m just venting. I thought I would have been excited that I’m close to closing but instead I feel kind of down.August 9, 2019 at 8:19 pm #50665NelsontMember
Ok so first of all if you go with FHA you will be paying private mortgage insurance (for 7 years or until 20% of the loan to value is paid off?) which depending on your loan could be over $100/month added to your monthly payment and that pmi counts against your DTI so it instantly lowers the amount of house you can afford.
Second if you go FHA you will almost certainly be required to pay a down payment AND closing costs which may be 3-5% each. So for a 100k house you may be required to pay 5000 down plus 3000 in closing costs.
Third you will not get 3.5% interest or less. You will get around prime which is 4.5 to 5 if you have excellent credit otherwise you will get 6-8% or higher. That will also increase your payment 100 to $200 /month and decrease the amount of house you can afford.
Fourth your loan estimate will change a few times and will only be finalized a day or so before you close.
The only benefit I see to fha is the ability to use almost any grant. In my opinion though the lower overall longterm cost of naca far outweighs anything. I bought a $360k house for only 14k out of my pocket. Where else can you say that?
It is easy to get frustrated with the process. Be happy you are about to be a homeowner! Congratulations!August 9, 2019 at 10:06 pm #50666living20057Member
Either way with any loan you would still for HOI, property taxes for escrow. Those closing costs are the same regardless of lender because it’s baed on the house.
I know the property taxes may be change the amount needed for close. For instance I believe I will need 2-3 of property taxes but the annual taxes are due in October. My escrow won’t be enough to cover so I will have to the annual taxes at closing. If I had of closed in March I would haven’t pay so much in property taxes.
And the prepaid interest due at closing depends on when you settle that amount will definitely change. But again that’s the same with any mortgage.
I know VA and USDA say no closing cost but they just roll into your loan. It may seem like less money but it’s just hidden.August 12, 2019 at 5:07 pm #50842KlassyMember
Try asking the seller for assistance.August 12, 2019 at 6:59 pm #50848Perkins5Member
Thank ya’ll! I’m feeling better today (minus still waiting for the bank). I was hoping to bring less to closing so that upset me a bit. But it is what it is. I knew i would be broke until 2020 after this house stuff anyways haha.
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