CuriousFellow asked:


Would there be 2 seperate closing costs if I do get 2 seperate mortgages? What are the disadvantages of getting seperate loans?

Ashley

Mohamad Alodah asked:




By the time you are finished finalizing the purchase of a home you are going to see so many forms that you may start to have dreams about them. One common myth is that these mortgage loan applications are standard across the industry but the truth is that they vary from one lender to the next. In many cases these forms are specifically designed to protect the interests of the lender.

Required forms for home purchases

While the forms that are used will differ between lenders, there are three loans that are all required for all residential transactions. The 1003, or the loan application, contains your financial information like your income, debt and credit history and is commonly used to qualify a buyer for a loan. Then there is the Good Faith Estimate which is simply an estimate of the closing costs of the home.

The last form is the Truth in Lending statement which is essentially a detailed summary of the loan including the interest rate, finance charges and the monthly payments. These forms will start to look the same after you are exposed to more of them. However, you need to be sure that you understand the details of each form before you sign your name on the dotted lines.

Some extra precautions to take

As mentioned above the types of forms that lenders use for residential purchases will vary so you will need to read through each of them thoroughly. In situations where you do not understand certain terms or if conditions are not clear then it is in your best interest to consult with a lawyer. In many cases you probably do not need a lawyer but taking precautions will only serve to benefit you.

When it comes to the big lenders in the industry most of the mortgage documents are standard but it is still a good idea to read through each form. Always ask for these documents ahead of time so you can examine them in detail before you finalize the transaction. Just remember too that signing any mortgage documents with inaccurate information could lead to mortgage fraud charges.

Jeff

days_o_work asked:


I am planning to purchase a 200,000-250,000 home in the state of Michigan, outright with no mortgage or any loan.

Hypothetically, if I purchase a home for 200,000 what will be my total outlay of cash before the home is actually mine? Assuming I am not taking out any loan to finance this home.
Also I am not sure how much I am going to be able to negotiate for zero closing costs as I am already planning to put in an offer about 10% under the listed price.

Finally, why does the owner care if its an all cash offer or not? They get their money either way, just from me and not a finance company.

Mitchell