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SVTPerformance's Chain of Restaurants
Road Side Pub
Those that are home owners...
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<blockquote data-quote="audioqueso" data-source="post: 4646716" data-attributes="member: 42430"><p>First, to answer your question, you should look at $10k for closing just to play it safe. Some are lower, some are higher, but $10k is a safe estimate.</p><p></p><p></p><p></p><p>Second, the reason you do not need any money down is because VA will grant you a loan up to 110% (or 105%.. don't recall exactly). Meaning, you obviously are not going to pay more than 100% of the contracted price. Yet, you still are guaranteed and allowed to finance that extra 10%.</p><p></p><p>For example,</p><p>The contract price is agreed at $300k. VA grants you the loan at 100%, but you are allowed up to $330k so up to $30k can be used for closing cost.</p><p></p><p>State laws require everyone to pay taxes, etc, etc.. the closing cost. There's no exception. The ONLY exemption VA has is PMI (and that's because it has 100% financing). No matter what, both parties still have to pay all the taxes up front. Whether it's the seller who pays 100% of all the taxes, or both split it 50/50. Taxes and interest still have to be paid upfront. That's what the closing cost is for.</p><p></p><p>However, keep in mind that when using VA, they are very strict about the appraisal. They will not grant over the appraisal estimate.</p><p></p><p>For example,</p><p>You and the seller come to a contract price of $300k. You're granted 100% (so you can use up to $330k). You think you have $30k that you can use for closing. The appraisal comes in at $290k. Your maximum loan now is $290k. So at this point VA will only give you $290k... period. Meaning, you no longer have extra loan money to use as a closing cost. You would have to bring the price down to $285 so that you can use that extra $5k for closing costs. </p><p></p><p>VA is very good for a first purchase, but it is tricky in some areas because of the sky rocketed real estate. Good luck.</p></blockquote><p></p>
[QUOTE="audioqueso, post: 4646716, member: 42430"] First, to answer your question, you should look at $10k for closing just to play it safe. Some are lower, some are higher, but $10k is a safe estimate. Second, the reason you do not need any money down is because VA will grant you a loan up to 110% (or 105%.. don't recall exactly). Meaning, you obviously are not going to pay more than 100% of the contracted price. Yet, you still are guaranteed and allowed to finance that extra 10%. For example, The contract price is agreed at $300k. VA grants you the loan at 100%, but you are allowed up to $330k so up to $30k can be used for closing cost. State laws require everyone to pay taxes, etc, etc.. the closing cost. There's no exception. The ONLY exemption VA has is PMI (and that's because it has 100% financing). No matter what, both parties still have to pay all the taxes up front. Whether it's the seller who pays 100% of all the taxes, or both split it 50/50. Taxes and interest still have to be paid upfront. That's what the closing cost is for. However, keep in mind that when using VA, they are very strict about the appraisal. They will not grant over the appraisal estimate. For example, You and the seller come to a contract price of $300k. You're granted 100% (so you can use up to $330k). You think you have $30k that you can use for closing. The appraisal comes in at $290k. Your maximum loan now is $290k. So at this point VA will only give you $290k... period. Meaning, you no longer have extra loan money to use as a closing cost. You would have to bring the price down to $285 so that you can use that extra $5k for closing costs. VA is very good for a first purchase, but it is tricky in some areas because of the sky rocketed real estate. Good luck. [/QUOTE]
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