Posted by River City on October 04, 2002 at 09:57:13:
I think 8.5% is a high rate of interest considering 30 year mortgage rates have dropped below 6%. Someone is ripping you off…unless you have a bad credit history.
Make sure that your contract states that the house must appraise for at least the sales price. Also, be sure the contract addresses who will pay for any repairs called for in the appraisal.
You also want the contract to indicate that you can have a home inspection and if the inspection is not to your satisfaction, you can void the contract.
The contract should also state that the offer will be voided if you do not qualify for a loan (listing a maximum interest rate).
Check with other lenders in your area. Some lenders offer first time home-buyer counseling. That would help you tremendously.
Posted by TQVelvet on October 01, 2002 at 23:50:49:
I’m currently buying my 1st single family home…
my mortgage broker found a lender who will finance 95% LTV (8.5% for 30yrs)…the seller is asking 95K, since I little money down, my broker has a grant that will give me 6K as a downpayment & I need 2K for closing costs. My real estate who found the house is acting as a dual-agent & i submitted an offer to the seller for 101K & 1,000 earnest monies (the appraisal has not been done yet) - can you give me advice on if the transaction is good or not?
And if the appraisal is less than the asking price, can i withdraw or re-negotiate my offer?
Don’t understand why you are borrowing 6k more then asking price if broker has found grant for downpayment and closing. If house does not appraise you will have to come up with the difference or renegoitiate price. Bank is only going to lend you 95% of appraised value.
I’m not trying to be party pooper but if you have limited availabe cash are you sure it is the right time to be buying a house. The one thing they don’t tell you when you set out to buy a house is the expenses that go along with keeping up the property. You could easily add $300 a month in expenses over and above the mortgage depending on the condition of the property. And if you get hit with a big ticket item, wow. Be sure that you have atleast 6 months of living expenses plus a couple grand to put towards closing in the bank. Statistics are starting to show that the increase in foreclosure rates are from rushing people into houses without any real consideration to the maintanence expenses that come after settlement and thier ability to pay for them. Its a huge decision think about it carefully and talk with a financial advisor before jumping in blindly.