It is paid on closing, when you sign documents with the lawyers office. Pay all closing fees before the lawyer hands you the keys.

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Ok, young first-time homebuyer here.... my fiance and i will be purchasing our first house, and i have tons of questions. i'd like an unbiased opinion, not the opinion of a real-estate agent working for the seller, or a mortgage broker just trying to make a commission. we'd like to stay on the lower end of our budget, and assuming we get pre-approved for our loan, we'd like to put $10,000 down on a little starter-home. i know closing costs range in price, but i was wondering if you can use "leftover" mortgage money to pay the closing costs? i have no idea how any of this works, and frankly it's scary! also, can money "left over" from a mortgage be used to fix up the house you just bought? for example, say the mortgage was for $175,000 and the home we buy is $130,000, can the remaining $45,000 go towards closing costs and cosmetics updates in the house? ok, question answered! i wasn't sure how all of this works, and no, i'm not suffering from a "delusion" as someone put it, and you were just being a jerk. i'm extremely new to this, and just had some basic questions since we haven't spoken to a realator yet. when you're 23, fresh out of college and buying a house, you need all the help you can get, not people being jerks about it....thanks to everyone giving real answers, and not just coming on here to pick on someone.... anyway, to get a home equity line of credit for any repairs or upgrades that may be needed in the home, don't you have to have equity in the house though? i was told by a professor a few years back that you atleast had to have part of the mortgage paid off before you could be issued a home equity loan. i was also told by another professor that a bank would let you use money to fix up the house you were buying for any necessary repairs. was i mis-informed

First, I suggest you get a Realtor . . . then you will have someone working for you, not the seller! Anyway, there will never be "left over" mortgage money. A lender will only lend the asking price or appraised value, whichever is less. You can often times lump closing costs into the loan but that depends on the loan program and what % LTV (loan to value) you are asking for. As for upgrades to your home, after it closes you can always get an equity loan or line of credit. Obviously in that case you need equity in your home, and have the income to justify another payment. Your best bet would to talk to a lender now. They will be able to qualify you and you will not only know what you can afford (and not fall in love with something to find you can't qualify) and can use it in the negotiating process. Believe me, in this market you have a one up if you can show that you can get financing. I am bias because I'm a Realtor, but honestly, use a Realtor; It probably won't cost you anything (seller offers commission, if there are two agents, listing and selling, they split, if not listing agent gets all) and you'll be covered. You need someone who knows what they're doing to represent your interest. As long as you sign an exclusive right to represent, they are working for you and not the seller.

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Hi everyone, i'm a first time home owner and have no experience with home buying terminology. i do have a realtor at this time. i'm looking to buy a single family home for about $250k - $300k max, prefer somewhere in the middle around $285k. my credit score is 784 from all 3 credit agencies. i have $60,000 cash for down payment. i have $0 debt. no car payment and rent is $500 a month (rent a room). i own a $30,000 car and $5,000 car free and clear. my annual income is $60,000+ . i have been asking around and it doesn't seem like i will be having trouble getting a loan. i was looking at the fha and conventional loan. since my down payment budget is $60,000. if i were to purchase a house with conventional loan of purchase price $285k and 20% down payment would be $57,000 that would leave me $3000 for closing cost which is cutting it really close. i was thinking about putting down 15% on a fha loan $42,750 which would leave me $17,250 left for closing cost and mip. the upfront mip will be 0.0175 of the loan amount $24,2250 which will be $4240. i believe under the new fha mip i will have to pay the mip monthly for 5 years until i can get the house appraised and have mip removed. the monthly mip will be $112 for 60 months that would be $6720. so basically if i go with fha 15% down i will have to pay a total of $10960 for mortgage insurance. what if i go with a traditional loan and put down 15% and get pmi for 2 years. so my confusion is should i do mip or pmi if i only want to put 15 % down ? if you guys have any other suggestions please let me know. thanks

Yes 20% down would be your perfect world but if you must do 15% down then I would ask the loan officer to give a print out showing the PMI rate on conventional compared to the FHA MIP rate. No up front PMI like FHA's MIP. Monthly PMI rate should be lower than FHA's with your great credit score and 15% down. Unless they've changed the rules since I got out of the business...You're PMI drops off when you have the house paid down to 80% of value. FHA's MIP falls off when you have it paid down to 78% of value. (And yes you would need an appraisal to prove this in 5 years.) **Upfront MIP can be rolled into your loan amount and doesn't have to be paid out of pocket at time of closing. **But where in the world are you thinking of buying that would require $17,250 for your transaction? That's at least $2,000 too much for closing and upfront MIP where I come from. Sellers are allowed to pay 6% of sales price (in closing costs and prepaids) for FHA and for conventional loans if you write your offer that way and they accept it. (Sellers can pay 6% on conventional if you are putting at least 10% down and if your contract is accepted specifying that the sellers contribution applies to your prepaid items as well as closing costs.) That should more than cover everything. We are in a buyer's market. The seller should contribute to closing costs! I understand that some sellers right now are victims of falling house prices so maybe they don't have enough equity to help pay many closing costs...but they need to agree to pay part of them if they want to get their home sold! Hope this helps!

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It is a little complicated. my husband and i are first time homebuyers, and qualified for our financing based on both of our incomes. neither one of us makes a lot, but we are excellent at saving and live a minimalistic lifestyle. i was told at work yesterday that as of july 1st, new work will not be coming in. the company employs about 15 people, who will be laid off as the work load decreases. i am in accounting, which will be the last department to go, but have only been working there about 2 months. i spoke to my boss yesterday, and she said she can't promise, but feels confident that i will still be there by my closing date (aug 7). i was laid off in sept. of last year as well, and it took me 7 months to find the job i have now. during those 7 months, i worked two part time jobs (one at a fast food restaurant) to keep earning money. after i get laid off this time, the same two jobs are available to me if i want them. these two jobs equal about the same pay as my current job (because i can work more than 40 hours per week), and after calculating our budget (including a mortgage and all the new costs with a house) would leave us with $500+ extra at the end of each month. we will also have $6000 in a savings account, and will get the $8000 first time homebuyer credit next spring. and i will obviously be job hunting for a real job come august. so- the question is- would you continue forward with purchasing the home? or would you forget about it (purchase agreement has financing contingency) and focus on finding a real new job before getting laid off (knowing that it might take months and months)? more details that make would enable people to provide better answers- i will have my job at closing and at least 2 weeks after, therefore i would not be committing "fraud" or whatever by not telling the lender. my two jobs that i have lined up for when i get laid off are sure deals, i am close with the owners of both businesses, and have an open invitation from both of them to work. also, ideally a married couple would purchase a home where the mortgage could be paid on one of their incomes. nice thought, but rarely true. (and what about single homebuyers?) if the bank approved us up to $210,000 on our income now (and the house is $160,000), i feel that we are living within our means. it is a home that we could live in for a long time, so i see it as an investment, especially considering we are 23 and 24. if we decide to wait a year or so, we will continue setting aside $1000+ a month for a home, we will just be out the free $8000 that we could have had by doing it now.

If the mortgage is same as or lower than your rent, it's a definite buy. You have to live somewhere, and unless if you live rent-free right now, there's no question it's a buy. If the mortgage is higher than your rent, figure out how much buying a home will save you in taxes next year (not including 8k credit, but incoming itemizing and deducting for mortgage interest). Divide the tax saving (if any) by 12 and subtract that from monthly mortgage payment and see if it's still higher than rent. If significantly higher, you may wish to reconsider buying - as the cost saving isn't there. A big factor is whether you save 6 month of minimum living expenses saved up as a cushion while laid off (mortgage, food, insurance, gas, util only). If 6k is sufficient then you can buy the home. Basically it's to defend against a prolonged and worsened recession. Is the 6k saving still there or used up as down-payment or closing cost? Also, resist the universal desire to redecorate and furnish your new home, and hold onto the 6k+8k credit (put it into money market to get at least 2.5% yield). Keep saving that 500+ each month until you're up to 9-12 month living expense, don't skimp on holidays, and you should be fine and able to hold onto your home even in prolonged downturn (even if you need months to find a job). Good luck and congrats!

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I've been trying for over an hour to find a site that states how obama care will help our economy. and so far, i've found nothing. *********************************** *********************************** *********************************** **************** the negativcongressional democrats are using several budget gimmicks to disguise the cost of their health care overhaul, claiming the house and senate bills would cost only (!) about $1 trillion over 10 years. now that critics have begun to correct for those budget gimmicks, supporters of obama care are firing back. one gimmick makes the new entitlement spending appear smaller by not opening the spigot until late in the official 10-year budget window (2010–2019). correcting for that gimmick in the senate version, sen. judd gregg (r-nh) estimates, “when all this new spending occurs” — i.e., from 2014 through 2023 — “this bill will cost $2.5 trillion over that ten-year period.” another gimmick pushes much of the legislation’s costs off the federal budget and onto the private sector by requiring individuals and employers to purchase health insurance. when the bills force somebody to pay $10,000 to the government, the congressional budget office treats that as a tax. when the government then hands that $10,000 to private insurers, the cbo counts that as government spending. but when the bills achieve the exact same outcome by forcing somebody to pay $10,000 directly to a private insurance company, it appears nowhere in the official cbo cost estimates — neither as federal revenues nor federal spending. that’s a sharp departure from how the cbo treated similar mandates in the clinton health plan. and it hides maybe 60 percent of the legislation’s total costs. when i correct for that gimmick, it brings total costs to roughly $2.5 trillion (i.e., $1 trillion/0.4). ... when we correct for both gimmicks, counting both on- and off-budget costs over the first 10 years of implementation, the total cost of obama care reaches — i’m so sorry about this — $6.25 trillion. that’s not a precise estimate. it’s just far closer to the truth than president obama and congressional democrats want the debate to be. www.professorbainbridge.com/​pro fessorbainbridgecom/2009/... *********************************** *********************************** *********************************** **************** about that cbo score of obama-care repeal january 7, 2011 2:41 p.m. by daniel foster nro has obtained a letter from cbo associate director sandy davis to hill staffers summarizing new analysis on the government revenue/spending effects of obama-care repeal. the analysis itself will be up on the cbo page presently, but here’s the letter with the relevant bit in bold: to interested hill staff: cbo and the staff of the joint committee on taxation (jct) have not yet developed a detailed estimate of the budgetary impact of h.r. 2, the repealing the job-killing health care law act, which would repeal the major health care legislation enacted in march 2010. yesterday, we released a preliminary analysis of that legislation indicating that, over the 2012-2021 period, the effect of enacting h.r. 2 on the federal budget as a result of changes in direct spending and revenues is likely to be an increase in deficits in the vicinity of $230 billion, plus or minus the effects of forthcoming technical and economic changes to cbo’s and jct’s projections for that period. we have been asked to provide the revenue and direct spending components of that total. extrapolating the estimated budgetary effects of the original health care legislation and accounting for the effects of subsequent legislation, cbo anticipates that enacting h.r. 2 would probably yield, for the 2012-2021 period, a reduction in revenues in the neighborhood of $770 billion and a reduction in outlays in the vicinity of $540 billion, plus or minus the effects of forthcoming technical and economic changes to cbo’s and jct’s projections. www.nationalreview.com/corner/25661 5/​about-cbo-score... does anyone have any links that will show how this will improve the economy?

There is no way in hell Obamacare could possible help our economy It's an overwhelming burden on businesses, states and individuals

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Ok, so we found a house that we really like, is just within our budget, and is hard to find in the area. it is a 5 bedroom 2.5 bath priced at 325k. there is another offer on the table that we were told is between 315k-320k. currently, we have an offer on the table to give them 1,000 more than their net proceeds from the other offer, up to 325k, but this is contingent on adding our closing costs ($8,000) to the purchase price of the house. so, basically, if they offer more than 317k, we cant beat it. we do have strong financing since we are able to put 20% down, but we are only pre-qualified for 325k. is there any other options to make our offer stronger or do we just have to hope that the other offer is on the low side? any advice would be appreciated. thanks

Remove the contingencies, those are deal breakers, especially if this is bank owned.

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I am in the midst of trying to purchase a home. there is a program in my county that grants you funds to homes they own (kind of like a hud program). i signed the sales agreement on the 28th of may and now that i am seeing the costs associated with moving into the house i think it would be in my best interest to move into the house closer to the end of the month. i live in a apartment and my lease is up on july 31st. the broker i am working with who showed me the house seems to be in a rush to close and said we would close by july 11th, but like i said i am looking at my budget and i would be paying for 21 days prorated and my mortgage in september when the first payment is due. is there a way to get a later closing date? its my first house so i'm clueless on what happens or if that messes up anything. i would rather pay 5-7 days prorated mortgage than pay 21 days.

Absolutely. Your broker just has to prepare an amendment to the purchase agreement. Don't let his desire to get paid put stress on your financial situation. Good luck.

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My wife and i both work and have recently started having children. we would like to sell our home and move into something cheaper to give us the ability for her to quit her job. we bought our existing home for 163k about 5 years and have put about $38k into the home (finished basement, remodeled bathroom, etc). we owe 130k on the house are looking to purchase a home that is 90k. i am trying to work our budget and need to know how much of the final sales price will we lose to taxes, fees etc. when we sale. i have heard people say about 9% and would like to know if this is accurate (is that if we pay closing costs or is that seperate?). how might this change if we sell the home by owner? ideally, i woul like to have at least 170k left over that actually goes into my account giving us enough money to pay off the exisiting loan, put at least 20% down on the next house and pay off our truck. thanks

Several things. Start with market value. Even though what you paid for stuff is important to you- the buyer will only pay market price. Find out what that is. It may be more or less than you think. If you are not represented by a real estate agent then you will very likely end up selling for a lower price- don't fool yourself. If you pay 6% commission that most often is split between the company representing you and the company representing the buyer- then each agent gets a cut and their companies take a cut. If you sell without representation you will likely end up still paying the buyer's agent their part. The seller often pays certain costs in the closing and the buyer often pays certain costs. Sometimes a seller agrees to help a buyer pay their costs because the buyer doesn't have the funds to close otherwise- of course in those cases the seller demands a higher price for the house (so in effect the buyer is financing their closing costs into the sales price/loan). A loan officer can tell you what you need to buy the next house and an agent can tell you what you are likely to clear out of this one. Base your plans on real figures- not hopes and wishes.

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I purchased a house for $120,000 fha loan in 2009 and now i don’t like the neighborhood and would like to sell the house and get another house in a different city of arizona, but now i know that my house value is less than i purchased; probably around $96000. i am not sure what should i do! should i accept the loss and also spend more on the new house’s closing cost, real estate agent and other costs, but that is too much and will hurt my budget or should i keep the existing home or rent it, but what if no one wants to rent it? or ?? i am really confused i don’t know what i should do. i need some advice please….. thank you

How much do you currently owe on your loan? If you owe 118,000k still and manage to sell the house for 90k and you use a realtor... you're looking at paying around 35k to sell your house. Do you have 35k sitting in the bank that you can afford to pay to get out of the home? If so, then you should do it if you truly hate the neighborhood or feel unsafe. If you just don't like the neighborhood, you're better off staying there for a few more years to try to lessen your loss. You typically have to stay in a home 5-7 years to break even, and since you're underwater in your loan... it might be longer. You don't get to "accept the loss." You have to be prepared to bring the money to closing in order for the sale to be completed. If you have the money... not a problem, if you're willing and able to spend that much to get out of the house. If you don't have the money, then you'll need to look at staying in the current house or renting it out and renting a place of your own in a different neighborhood. What's the current market-rate rent for your area? Will you be able to make a profit, or will you lose money each month? Are you prepared financially if you get tenants who trash your home? Do you want to be a landlord? Does your mortgage allow you to rent your home? There's a lot to consider if you go the route of renting. Unless your current income would allow you to purchase a second home... you'll be renting yourself because you cannot immediately count the rent on your current home as income. Unless you feel truly unsafe in your new neighborhood... I would stay there. 35k is a lot of money, especially on a 120k home - and, you might not even have the money to get out of the house. Markets will stabilize and begin improving again over the next few years, plus it will give you time to pay more of the principle of your loan off. Good luck to you.

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My husband and i are in the process of buying our first home. we have been approved for the price and have enough for the closing costs. the thing that worries me is what is to little to live on monthly. after all of ours bills, mortgage etc is paid we should have about 400 extra a month. i know this dosnt sound like a lot but my husband is due for his next raise anytime from now and he continues to get one every year...so it can only get better. im just wondering if anyone else who has ever bought a house has had to be on a tight budget for awhile and if its worth it...im a little scared. i know it can be done im just not used to it because we have been renting for awhile and have lots of extra money each month because our rent is so low. we just feel its time to take the plunge. also i meant to ask...besides electricity gas and water is there any other must have bills each month once purchased the house? thanks for your help

My opinion is that $400 is too close for comfort. Find a nice less expensive house with lower monthly payments. Any house will have surprises for you -- a plumbing problem, furnace or A/C etc. etc. It sounds like you are first time home owners and as such you will have things to buy that other home owners already have such as lawn mower, rakes, shovels, misc. tools etc. etc. You will learn more about Home Depot in 6 months as a home owner than in 10 years renting. Go slow and buy more within your means.

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My husband and i are in the process of buying our first home. we have been approved for the price and have enough for the closing costs. the thing that worries me is what is to little to live on monthly. after all of ours bills, mortgage etc is paid we should have about 400 extra a month. i know this dosnt sound like a lot but my husband is due for his next raise anytime from now and he continues to get one every year...so it can only get better. im just wondering if anyone else who has ever bought a house has had to be on a tight budget for awhile and if its worth it...im a little scared. i know it can be done im just not used to it because we have been renting for awhile and have lots of extra money each month because our rent is so low. we just feel its time to take the plunge. also i meant to ask...besides electricity gas and water is there any other must have bills each month once purchased the house? thanks for your help. i believe the taxes were added into my monthly payment already, that is what my mortgage broker told me.

You are not ready to buy a house. There are all sorts of other expenses ... from repairs, to increased taxes, to unexpected bills. You need to have 20% for a down payment, and your mortgage payment should be no more than 25% (on fourth) of your take home pay. It is worth it to wait until you are sure you know what you are getting into, and have room to wiggle in your budget so you don't find yourself in financial trouble. Get some good savings and don't count on raises that haven't happened! Layoffs happen, too. So do injuries, disease, death, etc. You need to plan a little more before you make this leap, then it will be a blessing to be a home owner. Right now it is causing you fear and sleepless nights.