From: drevik@utkvx2.utk.edu (Drevik, Steve)
Newsgroups: misc.consumers.house
Subject: Re: New house buyer questions
Keywords: mortgage, fha
Date: 16 Apr 92 13:56:00 GMT
Organization: University of Tennessee Computing Center
News-Software: VAX/VMS VNEWS 1.41

In article <1992Apr16.030527.19695@sunova.ssc.gov>, butteris@dingus.ssc.gov (Jamey Butteris) writes...
> 
>Apologies in advance for wasting bit-time for these potentially redundant  
>questions. (I am a new user of the news system). I am currently involved  
>with the construction (and finance) of a new home in the Waxahachie  
>(Dallas, TX) area and am concerned with the breakdown of closing expenses. 

I am going through the same thing, and I will tell you what
I know so far.

>The broker expenses were as follows (with explicitive text as needed):
>$63,000 mortgage value  (my first house :-)
>$ 2,300 One Time Mortgage Insurance Premium (OTMIP) (What the 'ell is it?)

Rather than paying MI monthly, you put up a lump sum that is supposed
to voer you throughout the term of your mortgage.  If you sell your
house before the full term of the loan (30y?), you are entitled to
a refund.  Your mortgage lender is required to give you a government
memo detailing how this refund is calculated.

Save it!

>$ 1,300 Down payment  (FHA)
>$    65 credit report (high, but not out of line)

Really high....I paid $10.00 for mine, and that was 'cause that's
what my bank charges me for a non-end-of-the-month balance statement!

>$   225 appraisal (Pretty standard, I think)
>$   607 1% loan origination fee (a "rip" but again, normal)
>$    45 inspection fee (local thing)
>$   175 title insurance policy (???)

Actually, that's cheap.  I am paying over $600 on a 100K house.

>$    30 recording (?)
>$   200 survey fee (fairly normal)
>$   150 document preperation (??? what is it, which documents ???)

Fee for the mortgage folk's lawyers.  Think those people can be
trusted to write a contract themselves?

>$    50 settlement/ escrow (again ???)

Another fee for the lawyer handling the escrow accounts, I guess.

>$   496 Escrow Insurance (I don't get it)

I would ask about this one.  See if it is optional.

>$   200 2 months advance taxes (Ok here)
>$    51 Mortgage insurance (Wait a minute, didn't I already pay this ?)
>$ 1,000 1.65 points (approx, ok here)
> 
>$ 5,604 !! total (Is this "normal", what is wrong with this picture?)
>	sustained mortgage insurance is an additional $25 per month!!

It shoulds like the mortage people are forcing you to take out a
second MI policy which is unnecessary.  The FHA is backing your 
loan, and that should be enough.  How many mortgage companies did
you look at before deciding on these people?  Have you already
locked in on these people?  If you are only in for $200 or so, it
may be worthwhile to look around again.

Especially if they are taking out an unnecessary MI policy!

>	
>Why so many insurances?
>Are these legitimate expenses?
>If I pay an OTMIP, then why a monthly mortgage in addition??
>Is mortgage insurance needed. 
>What about a general insurance policy that paya the mortgage if I die or
>     whatever?

That is your responsibility.

>What is escrow insurance?? Why do I need it.
>Can I get my own insurance to cover these requirements? How?
>Where can I find out more info without sifting through endless piles of
>     data?

Try taking this estimate to another mortgage lender & showing
it to them!~
> 
>Thanx in advance.
> 
>Jamey B @ SSC.