Financing in 60016>Question Details

Cecilia, Home Buyer in Chicago, IL

Was I overcharged in closing costs

Asked by Cecilia, Chicago, IL Wed Sep 19, 2007

I purchased a property for $180k and my loan was for $80k. My total closing costs came to over $6k. Is that normal or was I overcharged?

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In addition to the points already made.............The date of your closing can influence what cash you were required to bring to closing. If you close early in the month, the amount of interest paid at the closing table increases. It is also longer before your first mortgage payment comes due, so this does eventually work out to be the same dollars spent.
2 votes Thank Flag Link Wed Sep 19, 2007
Deborah Madey, Real Estate Pro in Red Bank, NJ
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One last thing to add to what has been said: Was money collected for an impound account for taxes and insurance? If so that would add to the cost.

Talk with your Realtor and closing/title company to go over the HUD1 with you.
1 vote Thank Flag Link Wed Sep 19, 2007
Pam Winterba…, Real Estate Pro in San Ramon, CA
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First, go to your agent, and if you are still not sure, go back to the closing attorney and sit down with them and ask them to explain in detail each line of your HUD / Settlement statement.
Web Reference: http://www.iansellsnola.com
1 vote Thank Flag Link Wed Sep 19, 2007
Good advice from the others. - There are many possible reasons for closing costs to be so high. In addition to the loan origination fee and lender costs there are also items such as first years hazard insurance ( fire insurance at least, also occasionally flood insurance.) property tax for the rest of the year, howmeowners association fees if it is a condo or PUD. Ttile insurance, escrow fees and transfer tax.
You may have paid "points" which is a form of prepaid interest. There are reasons to pay points, The best reason is to obtain an interest rate lower than the "going" Another reason why points may have been paid is if the property or the borrower didn't qualify for the "going" rate such as when the property is not going to be owner occupied or the borrower chose a "stated income" loan instead of "full docs"
If you paid points for your loan, your closing costs would have been higher but your monthly payment should resultantly be slightly lower and you could wind up saving money over the long run (it takes at least a few years)
0 votes Thank Flag Link Wed Sep 19, 2007
Jim Walker, Real Estate Pro in Carmichael, CA
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Without seeing your HUD statement, it would be impossible to tell. It does appear that you may have been charged a large commission from the mortgage lender.
0 votes Thank Flag Link Wed Sep 19, 2007
Hi Cecilia. Without seeing the final closing statement, it's impossible to render and opinion. Did you pay points for the loan? Did you go over the closing statement with your agent prior to closing? Sorry, I wish I could be of more assistance.
Web Reference: http://www.go2kw.com
0 votes Thank Flag Link Wed Sep 19, 2007
Ute Ferdig -…, Real Estate Pro in Newcastle, CA
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