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Unread 12-04-2008, 03:32 AM
 
2 posts, read 6,726 times
Reputation: 10
Default Anyone familiar with Homesteps(Freddie Mac)'s AskAnAgent promotion?

I just got a contract on a bank owned house. According to the contract seller, Freddie Mac, will pay up to 3.5% of purchase price towards closing cost as a winter promotion. But I can not find any fine print on what's being covered exactly.

The way they word it in the contract of sale is that up to $13,125 can be applied to any or all of: "FHA or VA non-allowables, non-recurring closing costs, discount points, loan origination fees, other customary and reasonable lender fees and pre-paid expenses, survey, appraisal, and home warranty".


I'm mortgage shopping and origination fee and discount points affect greatly with my interest rate so I want to make sure if anyone's got that covered by this promotion.

I assume the insurance and tax reserves would qualify as "pre-paid expenses" or "non-recurring closing costs".?.?. It seems they should, but I know lawyers like to find ways not to share their client's money... so... any experience with this?

Kim
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Unread 12-04-2008, 02:07 PM
 
Location: South Metro Denver and looking at houses
8,222 posts, read 17,089,385 times
Reputation: 3921
taxes and hazard insurance would be a recurring expense.

Loan origination and discount point would not.
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Unread 12-04-2008, 02:13 PM
 
Location: South Metro Denver and looking at houses
8,222 posts, read 17,089,385 times
Reputation: 3921
taxes and hazard insurance would be a recurring expense.

Loan origination and discount points would not.
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Unread 12-18-2008, 04:50 PM
 
595 posts, read 1,468,926 times
Reputation: 157
How long did it take you to get an answer from them? I've been waiting five days, and I made a cash offer. How many % below ask did you offer? Did they counter?
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Unread 12-20-2008, 11:23 PM
 
1,219 posts, read 2,521,051 times
Reputation: 547
It took over a week for them to accept my offer. I don't want to give advice on the promotion, because I'm still going through it myself-but it seems that they pay pretty much everything in the closing costs. That is the impression I got, but I haven't closed yet.
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Unread 01-01-2009, 01:57 AM
 
1 posts, read 4,863 times
Reputation: 10
I have just been involved in a HomeSteps purchase which went terribly bad....watch the sales agents carefully and don't let any expenses be approached out of escrow. With regard to the promo, this is a blanket amount relative to your sales price, not an a la carte seller coverage of fees. It is not advertised correctly, as, traditionally, in specific markets, seller covers half of the escrow fees...not so with the HomeSteps program...they give you a flat amount to cover whatever at closing not following the traditional local patterns....it is my position that this is false and deceptive advertising as it appears you can get 'cash back' at closing (maximizing the 1% for cash owner occupant or 3.5% for financed owner occupant)..the sales agent will also usually specify escrow agent (check fees in advance) and for this, the fees may be inflated but the seller may pay for title insurance. Also, Freddie Mac is tax exempt in most jurisdictions, so some tax stamp fees can only be paid by the buyer. The process was slowed by seller agent problems and escrow instructions were entered incorrectly from the sales contract...watch the timing!!!
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