Posted on: 10th Feb, 2009 06:39 pm
I am looking to refinance my loan and pull out equity for remodeling. I can get a FHA at 5% with 5,317.58 in closing costs and 6,088.03 in pre paid items/reserves. The total is 11,405.61 !!!! This seems like a lot but I never had mortgage insurance before. I understand the need but the numbers seem high.
Yes, I do feel it's quite a big amount as far as closing costs and prepaid items/reserves are concerned. What amount of upfront premium is the lender charging on your FHA mortgage insurance? I guess you should ask him to break down the costs and explain them in details before you sign on any documents.
The refinance loan is for 216,727.00, I owe 133,300.00. The prepayment on mortgage insurance is 3,727.50, tax reserves 1,619.52, hazard insurance 440.00, and pre paid interest 301.01. The closing was without a broker fee until the rates rose then to get them back to 5% I would pay a 1% broker fee of 2,130.00. There is also a 395.00 processing fee and a 595.00 admin fee that I am questioning, along with underwriting, inspection, wire transfer, flood cert., escrow, title insurance and credit report to get the grand total of 5,317.58.
It's really not that far out there for a FHA. Your looking at roughly 2.5% for the actually refinance fee and prepaids are prepaids are prepaids as we say, no way around that unless you sign on a different day of the month.
As long as rates actually went up and the broker isn't trying to back door that extra 1% fee on you, then your fine
As long as rates actually went up and the broker isn't trying to back door that extra 1% fee on you, then your fine
"There is also a 395.00 processing fee and a 595.00 admin fee that I am questioning, along with underwriting, inspection, wire transfer, flood cert., escrow, title insurance and credit report"
These are all items that are legit. They vary from lender to lender. The lenders I use do not generally have inspection fees, but all the others are usually tacked in there. These are 3rd party fees that can't be negotiated.
Your upfront MIP is 1.75% of the loan amt. This is an FHA standard, this is why your closing costs are so high.
These are all items that are legit. They vary from lender to lender. The lenders I use do not generally have inspection fees, but all the others are usually tacked in there. These are 3rd party fees that can't be negotiated.
Your upfront MIP is 1.75% of the loan amt. This is an FHA standard, this is why your closing costs are so high.
The bottom line is this....
You are getting a cash out refinance at a rate of 5%. Consider yourself lucky.
You are getting a cash out refinance at a rate of 5%. Consider yourself lucky.
