Closing Costs Question for the experts! Please help!

[Anonymous]

Hello All,

I am in the beginning of my quest towards home ownership.  I am interested in a Bank owned property that they are willing to pay closing costs for.  However, my realtor cautioned me that some Mortgage companies will only allow the bank to pay for 3% of the purchase price towards closing costs! 

Is there any one here who knows which Mortgage Companies these are?  I plan on using an FHA Loan and this home is not eligible for the USDA Financing program. 

Thanks in advance for all the feedback!!!!

[Anonymous]

Please Help!

[Anonymous]

Who told you that?

If the bank you are using writes FHA loans then the max toward closing costs is 6%.  Some banks don't write FHA loans and some sellers don't accept FHA financing.

Your Mortgage broker will only use those banks that write FHA who will allow you the 6% max.

[DallasLoanGuy]

Actually, most banks(the one who owns the property) will only contribute 3% towards closing costs. I have seen a few exceptions. I have never heard of a lender limiting you to 3% on an FHA loan since FHA Guidelines allow 6%

[Anonymous]

1111mel, 

My Realtor is the person who told me that.  she told me to keep it in mind and that kind of sent me in panic mode. 

So 6 % is the max that you can have contributed towards closing costs?  Is that usually enough.  How much more should I figure into my out of pocket expenses? 

[Anonymous]

Thanks DallasLoan Guy!

I just wanted some clarification because what my realtor said sent me into panic mode.