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So it's my very first time buying a home and I was recommended by my realtor to go FHA for whatever reason. 2 weeks in I realized there were other loans and I had more options so I did my research to see what I felt was best for me and my situation. I was getting kind of far in with my first lender by he was out for a week during the holidays so I couldn't tell him sooner to get my answers
Anyway, after much thought and headache, I decided to go with my bank since I've had a long term relationship with them. They also were able to lower the rate even lower than my broker. I would be saving $90 more per month plus discounts on closing costs and saying I won't need to bring more than $1,500 to close. If I qualify for a grant then that seals the deal.
My only issue is that the first lender I went through was already so far in (just finished an appraisal), I'm not sure how much fees I will be owing and if it was worth choosing my bank. Also, he claims I get $5,500 grant toward down payment and closing but if I apply soon I may be able to apply it to my bank.
Anyway, it was a hard decision. I'm felt like I dumped someone and they want me back. He was upset but professional and really wanted my business. The only benefit he has on his end is the grant and fees I may owe him because I'm so far into it.
Did I make the right decision to save $90-100 more per month even though I may not get a grant and owe fees to the broker?
This is not a friendship circle. Do the math. Your agent screwed up by trying to direct you to one person. Chances are, that's who would get her the letter when needed.
Nothing will make you feel good about dumping the first lender. I promise you, paying $90 a month more for the next 30 years (FHA MI is for life) will not make you feel better. Cut your losses, send him a bottle of wine. Also, I don't know anyone in this business that truly checks out for a week, Holidays or not.
Yeah, my bank was really going above and beyond I feel. But the fees...with the first lender and the grant. Would that even be something I should worry over? Paying the fees I would owe the lender for doing all that work and possibly losing a grant? There is a chance I may get the grant to my bank but I would have to act quickly.
Yeah, my bank was really going above and beyond I feel. But the fees...with the first lender and the grant. Would that even be something I should worry over? Paying the fees I would owe the lender for doing all that work and possibly losing a grant? There is a chance I may get the grant to my bank but I would have to act quickly.
SORRY act quickly. Get off city data and CALL THE BANK!
I did go with the bank but the broker is calling me trying to change my mind. So your ink it's worth saving $90 a month even though I could possibly lose a grant and also owe the broker fees for the appraisal and other stuff?
Comparing a grant with no grant and $90 less a month but paying fees... do the math. Divide out how long it takes you to recoup all the closing costs you'll have to pay out of pocket. You will probably also owe the first lender the appraisal fee because those aren't free and someone has to pay it. Those usually run about $400-500. Include that number in your math.
And when you say "bank", I think "yikes, we're going to be closing late and in 60-90 days not 30 per my contract." Which bank are you talking about? If it's one of the big ones, the nice person you're talking to at your bank is not going to be handling the actual paperwork and getting things done. You will be passed off as a number, just a heads up.
Unless you signed some sort of contract I'm not aware of (as being standard practice for getting a loan, I don't recall signing any) it appears to me the worst you are out is your appraisal fee, which should be only a small amount of money, maybe $500 or less.
This is a business transaction, not a love fest. If you can get a better deal, dump the first lender. I too would be happier having my mortgage with my present bank and banking relationship.
Note that your present bank will want to use their choice of appraiser so you will have to pay for the new appraisal.
I'd switch in a New York minute if the new deal with my current bank is better than the current deal.
Warning: interest rates are increasing. Plan to lock in your interest rate and time it to ensure that it does not expire before the closing date. Get the longest rate lock and shortest escrow period you can negotiate.
Also, as buyer, you should understand that you can pick your own escrow company. Food for thought.
With the bank we had to have a two week extension so closing date is Jan 31. He says we are ahead of schedule and doing fine. I'm passing things really quickly considering I have a good savings account and really high credit scores. The interest rate with the bank is also locked.
My only concern is how much fees will I be paying the other lender?
Right now the quote for loan costs says
Services I can't Shop For $2,720
Appraisal Fee- $550
Condo Questionnaire Fee- $75
Credit Report- $75
Final Inspection $150
Flood Certification $9
Would I really be responsible for all these costs for switching? I know I have to pay an appraisal. Can I have my bank cover some of these? My bank is not charging for most of these costs it seems when I compare.
Last edited by Michelle21689; 12-31-2016 at 11:12 AM..
With the bank we had to have a two week extension so closing date is Jan 31. He says we are ahead of schedule and doing fine. I'm passing things really quickly considering I have a good savings account and really high credit scores. The interest rate with the bank is also locked.
My only concern is how much fees will I be paying the other lender?
Right now the quote for loan costs says
Services I can't Shop For $2,720
Appraisal Fee- $550
Condo Questionnaire Fee- $75
Credit Report- $75
Final Inspection $150
Flood Certification $9
Would I really be responsible for all these costs for switching? I know I have to pay an appraisal. Can I have my bank cover some of these? My bank is not charging for most of these costs it seems when I compare.
Those are the fees on the estimate you received from the broker, correct? I say the ONLY one you're paying is the appraisal because it's already been done. I don't see ANY other fees that you should pay. Tell them to cancel quickly, if that's what you want to do, before they rack up other charges (like the condo questionnaire fee.
Regarding that appraisal: Make sure you get a copy of the invoice from the appraisal. I doubt it really cost them $550. Demand it before you pay them a dime.
Regarding your grant: WTH can't you get it with your bank?
Yeah my realtor told them to stop. It sounds like it would be worth it then. If I can get the free grant money towards the bank if it isn't too late then even better.
Broker:
FHA 4.75%
$792 including taxes and the $75 mortgage insurance
Bank
LPMI 4.62%
$711 including taxes no insurance.
Broker is too late to change to LPMI but even so it would be 5%. also mortgage insurance doesn't benefit me at all for $75 and won't go away for the life of the FHA loan.
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Thanks
