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Old 02-08-2010, 04:09 PM
 
382 posts, read 1,196,047 times
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Ok, I know there are a lot of questions out there, but I'm trying to be a little more specific for my situation.

Our lender said he was able to get a 5.3% interest rate, but the APR is showing 7%. I understand what the APR is suppose to include and why the two are different (or think I do), but this doesn't include taxes or insurance.

We are in a re-stabilization program. We pay 1% down payment, they pay 5k and closing costs. There are no payments to points. ALl of our fees are covered as far as I have been told.

Does this sound right?
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Old 02-08-2010, 04:34 PM
 
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Even if you are not paying $5k and closing cost, all the finance charges are included to calculate the APR. Just make sure that they actually pay what they promised. Occasionally, the bank may default on their terms in the 11th hour.

This actually happened to me. I was promised that the bank will pay $2250 (roughly half of closing cost), but they only applied $150 on the preliminary HUD the day before closing. I had to postpone the closing by 1 week to make sure they apply the correct amount that they promised in the GFE.
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Old 02-08-2010, 04:46 PM
 
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Ah, that makes a bit more sense now. The City we are buying the house from (the seller) is the one who is paying all the closing costs and fees. It is part of the program, so I'm not worried about that.

If the Truth and Lending Act has changed, does that mean the GFE has changed too, as in we have a new interest rate and need to sign new forms for both?
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Old 02-08-2010, 04:52 PM
 
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Never mind, I asked my lender and they explained about the TLA and GFE to me. thanks though!
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