Financing in Cypress>Question Details

Erik Miller, Home Buyer in Cypress, TX

Is it possible to finance the closing cost in the purchase of a home ?

Asked by Erik Miller, Cypress, TX Fri Mar 19, 2010

I have been able to raise the downpayment funds but I am concerned about the cost at closing. I saw where a realtor was offering the FTHB tax crexdit as a downpayment?

Help the community by answering this question:


Normal and customary for seller to pay some of the costs these days. They can pay all of them as long as it isn't going over the guidelines limits. 3% of purchase price can be rebated back to buyer in the form of seller credit towards closing costs. FHA allows 6% currently.

Let me know if you have any questions.

Tom Burris
0 votes Thank Flag Link Fri Mar 19, 2010
Closing costs and pre paid items can be paid by the seller.

There are also programs that would allow lender to pay a portion of the closing costs.

Let me know if I can help.
0 votes Thank Flag Link Fri Mar 19, 2010
Yes, through a seller's concession - but I amplify the caution voiced by the last poster - essentially this inflates the price of the home by the amount of closing costs you are financing. The sellers gets the net, but the home must appraise for the full price, including the concession. With appraisals already stressed, this may cause a problem, so just be aware.

Jeanne Feenick
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0 votes Thank Flag Link Fri Mar 19, 2010
One thing to keep in mind with rolling the closing costs into the loan is that it MUST APPRAISE. The market value is heavily affected by the already rock bottom pricing and foreclosures.

I have attached links to both Harris County and City of Houston's down payment assistance/grant programs as well as a helpful tool for shopping the best loan.

Good luck!!
0 votes Thank Flag Link Fri Mar 19, 2010
Hi, Erik

Yes, so long as the seller is willing to pay what's called seller concessions. With FHA you can get up to 6% of the sells price in concessions. However, your mandatory min. down payment of 3.5% must come directly from you out of pocket or as a gift from a family member, your church, or a HUD recognized down payment assistance program.

With regards to the seller concessions, the seller can also increase the sale price accordingly to accomodate you if they are unable to do it any other way. Simple example: 100,000 sale price X 6% = 6,000 in seller concession. If the seller has to get 100,000, he/she/they can then increase the sale price to 106,000. Hope this helps.
0 votes Thank Flag Link Fri Mar 19, 2010
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