Are these numbers good for a 30yr, fixed, conforming/conventional mortgage loan?

Question

Price of home: 159,470
PMI: yes
Interest Rate: 6.5 -> builder offered free point to buy down to 6.375
Estimated Prepaids: 1,584
Estimated Closing Costs: 3,793
Total Costs: 164,847
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Good Faith deposit already put down: 1,500
Lender Credit: 175
Paid by Seller: 1,595 (interest rate point)
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Total Loan Ammount: 159,470
Total Settlement Cost: 2,112
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Payment schedule:
no. of pymnts: 120 Principle & inter & PMI : 1,123.80
no. of pymnts: 35 Principle & inter & PMI: 1,021.47
no. of pymnts: 205 Principle & inter: 994.89
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Notes:

I didn't have enough down payment (20%) to get out of PMI because i recently spent 15k to get totally out of debt (paid off car, student loan, etc..). I now have 0 debt and plan to pay 400$ a month extra on my mortgage to cut the # of yrs and end pmi sooner.

Oh yeah, with PMI, closing costs, the APR is 7.24%

Answer 1

6.5 % is a nice rate if your score is under 660 if not its a bit high also looks like they are charging you yield spread. ok yes they are charging you yield spread! remember APR is calculated over your 30 yr mortgage so the fees you pay to close will not rase the rate on apr that much.

todays par rate for someone who has 680 + is about 6.125% It also looks like this is not a fixed rate mortgage typically the payments would not change unless it was some kind of hybrid ARM product!

chek into anouther lender with the figures you have they should be able to beat that deal! try my favorate!
se if they will beat the deal you have! if they can you are ahead of game!


Http://www.DirectLendingPlanet.com

Answer 2

PMI is a waste of money if it can be avoided, and being that values are coming down pretty much everywhere it could take longer then you expect. I understand you thinking of paying an extra $400 a month to get rid of the PMI, but since you have spent ALL your money and have nothing, what happens if your home needs something repaired? why not take the $400 a month put it in a side account let it earn interest, and in 3-5 years see about refinancing your home to get out of the PMI. OR take a loan where the lender pays the PMI, PMI is not protecting YOU it protecting the lender should you default, you say you have no savings, what happens if you pay $400 a month extra to your mortgage and 2 years down the line you loose you job, you have nothing in savings, and your mortgage lender wont let you have it back if you cant qualify to refinance, imagine if you put the $400 in savings, now 24 months later you have saved $9600 , and if you went unemployed for 6 months you could still make your mortgage payment, dont become a statistic. I dont know about you, but I would rather have my money earning interest, rather then paying down my mortgage, and have enough money in a savings account to payoff my mortgage is I choose to. Do you really plan on staying in your house your whole life and never move? Do you really want to pay it off early and loose your largest tax deduction?

Answer 3

Looks OK , but too bad about that PMI .
That looks like it adds a huge chunk .

But your plan for payoff is very aggressive ,
Hope you hold to that .

The $400 extra should have you out of PMI in less than 80 months ( save you 55 months on that schedule above ) , then the $400 extra should knock about 10 years of your loan .

WAY TO GO !

>

Answer 4

If you got out of the loan, the bank would sell the house at a reduced price and you would be responsible for the rest. If there was fraud done to allow you to purchase a house, regulators would think you had a say in it. Did you have the house inspected, if so you may be able to go through the inspectors insurance.

Answer 5

depends on your credit score....but you should be able to do a MyCommunity and get a lower PMI.
the builder offering 1point should lower your rate to 6.25....at least...not 6.375% that's a ripoff