Terms of loan?

Question

Can anyone tell me if this is a good loan please take into consideration I have had a problem obtaining a loan due
them telling me my credit score is between 580-620
i have very little credit history and only a few debts due which are recent. This loan was offered by someone I know working
with mortgages. I also am applying for no doc loan as I have my own business but have very little business income to show and due to situation where my tax returns have been unfiled
pending proper execution of estate taxes and court settlements which will be reflected on my returns and lack of ability hire someone to complete the returns acurately
it was offered to me for a 200,000 loan
it says conventional fee simple purpose of loan purchase
interest rate 10.750 arm 5/1 no months 360/360
first mortgage payments monthly 1,866.96 estimated prepaid items 1,791.67 which is interest for 30 days @ 69.7222 per day estimated closing costs 12,914.00 cash from /to borrower
185,294.

Answer 1

For the love of god please don't do this. I assume you live in the USA. Maybe you have heard in the new all of the problems with sub-prime adjustable rate mortgages. I am surprised that someone is still willing to give you a loan of this type. You are going to pay $14,706 in fees to get a 10.75% ARM (sounds like a bad deal to me). How much are you going to put down/ or how much equity do you have in it right now? If you have no equity or no money down, what are you going to do if you have to sell in a year or two or three? This loan is a recipe for foreclosure. You are better off waiting until you are in a better position to qualify for a better loan. In the mean time clean up you credit issues, and get your business off the ground and in good shape.

When I bought my first house in was a similar amount that you are requesting and my fees were much, much lower. Check out this link and click on the state you live in to get the average closing cost for your state for a $180K loan (the amount you are looking at is a little different but can give you a good basic comparison). Your closing cost is way above average.

http://www.bankrate.com/brm/news/mortgages/ccrank.asp

Sometimes waiting for what you want makes it that much more special when you finally get it. Don't get a bad loan so you can have what you want right now, chances are you will have it taken away from you which will be worse than never having it in the first place.

Answer 2

This loan will be fixed for five years and then will begin to adjust. Before you move forward you need to know:

1- Is there a prepayment penalty? if so, what are the terms? Will it be charged even if you decide to sell this property (called a 'hard' prepay).

2- What kind of ARM is it? What is the margin? What index is the loan based on?

As question I have for you: do you own this property outright? Because it appears that you are not paying off any debts through this loan. If there are any mortgages or other liens, they will have to be satisifed first and you won't get $185,294 at closing.

If you do own this property outright, think long and hard about the payment you are about to take on and whether you can comfortably afford it. Also, determine how your payment will adjust when it starts to adjust, or you could be in for a rude awakening when five years goes by (seems like it's far away now, but when that payment comes due it will be very real).

Honestly, I am shocked you are able to get a no doc loan right now. I don't know of any lenders offering them, although I suppose there might be someone out there who still has money to lend for this kind of thing.

Answer 3

In this market you are lucky to get a no-doc with your fico and credit history. Make sure you inform your loan officer of your tax situation. Most lenders require a "4506" executed prior to releasing docs or at the closing table. If the report from the IRS reflects no taxes file this could hold up your closing.

Answer 4

Hello Everybody,

I am James William, a U.K resident and a second year student of university of liver pool. Just a months ago i walked into the hands of some dubrious person(scams), when i was in search of a loan of € 4,500 Pounds to enable me fund my education since i lost my parents in a gharsly auto accident while they were away on vacation. the scamers parted with my € 540 Pounds, which i managed to gather from friends and families to enable me takr care of my bills for lart two months. I decided to tell Betsey.A.Braiaton who communicated the story to Adrew Fulp who happens to be my Vic president for academic services and has got link with various notable lending firm accross the globe. By this means using it to bring a globarlizetion to the world, many student and business men having finacial problems have been able to complete their education to bring a globar happiness around the world .
My happiness now is that i have not only gotten the loan(€ 15,000 Pounds) to pay my tuition them Harvey Loan Inc, piloted by Mr, Patrick Harvey, i have also been able to establish a chaned to allow me collect money at very low competative interest rate.
since they have assured me thet i can come for more funds as long i am a genuine person for requesting it and that there is a possibility of repayment at the stopulated time.i have never ever seen this kind of wonder in my life and i decided i will tell it to the whole wild world and i need every one to thank GOD for Mr Patrick Harvey, the man GOD used to rescue me even when all hope had been lost and gone and i will say to every one, no matter how dark and sinful the world is today, there are still GOD fearing and reliable people on earth and if you are in need or require a loan legitimately and Government approve lenders, i will advice you contact this loan lender and you can reach him via [e-mail] and i want you all to pray for this man for me and you will also tell the world your own story.