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Hello. I am very protective over my parents and while I personally am completely new to mortgages, $7685 closing costs seem high to me for a house that sells for $112,900. This a conventional loan, property (2 bdrm house) is located in western Pa, and they have good credit (credit scores 760 and 825, current low living expenses under $600/month, $28,000 combined income).
This was sent to us through a mortgage broker that the realtor knows. If you could please look it over and tell us if these closing expenses are too high (I am personally wondering if the broker's Origination and Processing fees are too high). Did she find them a great interest rate? Do they even need a mortgage broker?
My parents are good people, the type who worry more about making too low an offer for risk of offending the home owner, so your help would be much appreciated! Thank you!
Loan origination seems high, but hard to say since we don't know property specifics. I'd recommend asking them to breakdown the origination fee.
Also get gfe from more than one lender and compare everything. You are under no contract with a broker or bank until you sign papers.
FYI you also are getting a lot of lender credit for that rate. See if the rate can be lowered unless your parents need the credit to reduce the closing costs.
They are closer to $6000 due to the Lender Credit - which may or may not still be available. Still, they seem to be about $1000 high to me.
They're even lower than that because the seller will have to credit taxes from Jan 1 through the day of closing. The lender is collecting 10 months, but your parents won't be in the house 10 months before they're do in full. The seller has to pay their share.
Should be 3-5K depending on where you go based on that loan amount- the smaller loans like your parents net less amounts for the broker and banks...
Brokers will increase their compensation plans which will increase your closing cost to make up for the smaller loan amount-
If any questions email me if you need a comparison.
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