Are you starting to worry about closing costs, and wondering if you can lower them? There are several ways that your closing costs can be minimized to cut the amount you owe at signing. Typically, you can discuss these options with your loan officer who will find out if any of the following are possible:
Mortgage options with lender credits allow you to reduce your costs at closing by having your lender “pay” the closing costs for you. However, this option will typically come at the cost of a higher interest rate.
It might just be a hike of 0.125% in exchange for the credit, but over 20 or 30 years that fraction of a point of interest can add up. Consider all of your options before financing your closing costs with lender credits.
Seller Credits: Are They Worth It?
The seller credit can be applied towards the following items:
- Prepaid items including property taxes, homeowner’s insurance and daily interest.
- Title insurance that protects you and your lender if a problem arises after closing.
- Discount points used to buy down your interest rate.
- Inspection fees for required home inspections prior to underwriting approval
- Recording fees for documenting your home’s purchase with local government agencies
- Appraisal fee to cover a third-party appraisal of the home to determine the market value.
- Escrow closing fees to coordinate signing of your final loan documents and money disbursement.
Real Estate Agent Credits
In some cases, if you use a buyer’s agent, they may be willing to rebate part of their commission to you. Some states don’t allow this to be done before or at closing, but if you can manage to cover closing costs you can receive some or all of the money back from your agent afterwards.
Closing costs shouldn’t prevent you from pursuing home ownership. Where there’s a will, there’s a way! You have multiple options to help reduce these costs and make your dream a reality.
Your Sammamish Mortgage Loan Officer Can Help You Start the Preapproval Process Today!
We’ve fine-tuned the preapproval process to make it one of the easiest experiences you’ll have in the whole home buying process. Buying a home should be fun and exciting, not stressful. Get preapproved today!
Sammamish Mortgage has been in business since 1992, and has assisted many home buyers in the Pacific Northwest. If you are looking for mortgage financing in Washington State, we can help. Sammamish Mortgage offers mortgage programs in Colorado, Idaho, Oregon and Washington.
Contact us if you have any mortgage-related questions or concerns. If you are ready to move forward, you can view rates, obtain a customized instant rate quote, or apply instantly directly from our website.