Posted by SusanL.–FL on May 10, 2000 at 08:14:44:
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Avoiding high closing costs - ? - Posted by Marty
Posted by Marty on May 08, 2000 at 15:01:10:
Hey, I’m new, and my experience has been purchasing my own
family residence. Every time I have bought a home, the closing costs have been astronomically high! Fees for this, fees for that, loan origination, etc. How do you keep these loan fees from taking such a big bite out of a deal? - thanks!
Re: Avoiding high closing costs - ? - Posted by Jim IL
Posted by Jim IL on May 08, 2000 at 16:13:09:
Marty,
Here are some ways.
- Do not buy using a conventional loan.
- Make sure the deal has enough room in it that if you need to pay these fees, they do not kill the deal.
- Pass the costs onto your buyer.
HTH,
Jim IL
Re: Avoiding high closing costs - ? - Posted by Marty
Posted by Marty on May 08, 2000 at 19:40:28:
I may be chasing the wrong kind of deal, then. I have a realtor showing me a single family home which needs extensive cosmetic work. She says the sellers are real motivated. I’ll know more later, but you’re saying don’t spin my wheels with a deal where the buyers want me to get a conventional loan and close in 30 days. Chase the deal where the seller will let me close in 4 months - ? And go in and do the rehab? (Right, I have little or no money, just starting out, yada yada yada.)
Ask the seller to pay part of your closing costs. - Posted by SusanL.–FL
Posted by SusanL.–FL on May 09, 2000 at 14:15:22:
The maximum amt. (allowed by law) used to be up to 3%.
If they are ‘motivated’, they may go for it!
If they don’t, see what they WILL go for. Remember! Everything is negotiable. Nothing is cast in stone.
Some of the high-ticket items are things like the title insurance. Maybe they’ll do a 50-50 split.
I sold one SFH with owner financing BUT I told my buyer that HE was paying ALL the closing costs (and he DID!) 
It can work both ways. Look for things that work to your advantage either as the buyer or as the seller.
If they WON’t help pay for any of the closing costs, then sniff out a few other things. See if it needs new carpeting, roof, or paint (inside 'n out). If it does, then ask if they’ll give you a $credit$ toward any of these repairs/upgrades. Sure can’t hurt to ask!
Good luck!
Re: Ask the seller to pay part of your closing costs. - Posted by TomC (Md)
Posted by TomC (Md) on May 09, 2000 at 15:18:16:
The 3% max is not a “law”, rather a max amount that Fannie Mae or Freddie Mac will allow on the settlement sheet to consider it a conforming loan.
If you are dealing with non-conforming (portfolio) lenders, you can go higher on the closing cost contribution.
TomC