Congratulations! After a few weeks of gathering documents and waiting for your mortgage loan to be processed you’ve finally been approved! Soon it will be time for the loan closing, the culmination of the process. Now it’s time to think about Gulf Shores loan closing costs and, more importantly, minimizing them and keeping more money in your pocket. After all, you’re getting ready to make the down payment and now you have to come up with even more money to close the deal?
Ways to Reduce Your Gulf Shores Loan Closing Costs
Exactly What Are The Gulf Shores Loan Closing Costs Anyway?
At the loan closing, most borrowers are required to pay a certain amount of money to cover these and potentially other items required by your lender:
Real estate taxes and homeowners insurance paid into an escrow account
Interest points purchased to bring down your interest rate
Title transfer fees or title insurance premiums
Appraisal costs and survey fees
Homeowners association dues
Why Do These Amounts Vary From What Was Estimated?
Remember when you applied for your mortgage? You probably received a Good Faith Estimate of what the Gulf Shores loan closing costs would be based on typical mortgage transactions. The key word here is “estimate.” There is only a slight variation, if any, from what the lender may change you in the way of origination fees, processing fees, etc, However, the third-party fees like appraisals, surveys and home inspections may vary.
In addition, if you’re refinancing, it’s possible that the property may appraise lower than anticipated, causing your loan-to-value ratio to be higher than expected. Your lender may require that you pay more in prepaid interest points at the loan closing to secure a specific interest rate.
How Can You Keep Closing Costs Down?
So what are your alternatives if your Gulf Shores loan closing costs are simply more than you can afford? Consider these options.
Many times purchasers are able to negotiate with the seller or his agent that some or even all of the closing costs will be paid by the seller. A motivated seller may be open to such a proposition as a necessity to sell his property. Usually what happens is the seller agrees to certain concessions — to pay certain closing costs — in exchange for the purchaser paying a slightly higher price for the property. This allows the buyer to “finance” the closing costs into the total mortgage amount and amortize it over the loan’s term rather than having to have the extra money at the loan closing.
Find more articles pertaining to saving money on your Gulf Shores mortgage under our Gulf Shores Mortgage Info to your right just below our Gulf Shores Real Estate Categories.
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