The Closing Costs, AND The Prepaid Costs?! (insurance, escrow, real estate)

[In_Correct]

I would be a first time home buyer. But what are the closing costs? When they say "Closing Costs" does this include ALL costs? I doubt it. There are probably others.

Such as The Prepaid Costs: These are all the property taxes and the home owners insurance? It must be paid in advance?

What about Interest?! It must be paid in advance too?!

Sooo. Let's say the property tax is 3.00% at its worst. Will the Home Owning Insurance be 3.00% too? What about the other closing costs? Are they 3.00% ?!

So adding all the upfront costs to get her ... Will the costs be example 20% of the house, just like the desired down payment?!

I also do not want to do the Escrow. Is possible to do it separate? Because The Escrow is a scam?!

Want to share what all you property taxes and closing costs and Insurances and Interest and based on asking price and every thing else you had to pay for your house? Share??

[SmartMoney]

Your many questions suggest you would benefit greatly from first time home buyer education in your area. Using the zip code associated with your profile, there are a few in your area. I quickly located TCHP, Inc. : Programs & Services : Homebuyer Education and City*of*Denton, TX : Homebuyers Education Class

In the class, you will learn that for the entire 30 years intererest is paid in arrears, or after the fact, with the exception of the month you close in.........or, RESPA makes certain the lender never has too much money at any given time in your escrow account and what happens when they do. HUD RESPA FAQs by Consumers about Escrow Accounts. You ask if it's possible to separate escrow accounts - the answer is yes, with 20% down. The feeling there is if you don't have the ability to save the down payment, would you have the ability to pay a tax bill in the thousands? If you don't pay your taxes, the county can foreclose on the home for tax deficiency, so the lender must race to pay your taxes or lose their collateral.

As someone that lends in all 50 states, I can share each state is unique in their closing costs. Some states require you to pay 12 months taxes in advance, while others are in arrears. Many have regulated title insurance fees and others are what we call "attorney states," meaning only an attorney may handle the closing. So, the many questions you have, the individual answers may not apply to you. Homebuyer classes cover your regional specific issues. And, if you can't attend, many offer online classes for no charge and would be the best source for your answers.

[TimtheGuy]

Originally Posted by In_Correct

I would be a first time home buyer. But what are the closing costs? When they say "Closing Costs" does this include ALL costs? I doubt it. There are probably others.

Such as The Prepaid Costs: These are all the property taxes and the home owners insurance? It must be paid in advance?

What about Interest?! It must be paid in advance too?!

Sooo. Let's say the property tax is 3.00% at its worst. Will the Home Owning Insurance be 3.00% too? What about the other closing costs? Are they 3.00% ?!

So adding all the upfront costs to get her ... Will the costs be example 20% of the house, just like the desired down payment?!

I also do not want to do the Escrow. Is possible to do it separate? Because The Escrow is a scam?!

Want to share what all you property taxes and closing costs and Insurances and Interest and based on asking price and every thing else you had to pay for your house? Share??

If you are putting 20% down you do not have to escrow and won't have to come up nearly as much cash at the closing table. BUT you will be responsible for the real estate tax and homeowner's insurance bills when they come due.

Escrowing is not a scam. It is just your lender administering the tax and insurance payments for your property for the life of the loan.

The interest that is pre-paid is minimal. It is limited to the amount of days from your closing date to the 1st of teh next month. If you close on the 1st of the month, the pre-paid interest due is $0. If you close on the 16th of a month, your pre-paid interest will be 15 days worth.