USDA Direct close on July 10, no way to pay first year insurance due

[Anonymous]

My closing date for my USDA Direct is Friday, July 10th.  I found a house for 129k and it appraised for 130k.  

The seller is paying closing costs, but I have no idea how much.  My realtor told me my closing estimate costs 

paperwork from the USDA were incorrect.  I got everything done on my to do list except paying my homeowners

insurance.  It's $ 1,800.00 and I simply do not have it.  I shopped around, got quotes from everywhere.  The lowest

quote was $ 1,600.00 and that was if I had my car insured as well.  I asked my underwriter last week for help, she

told me it has to be paid, period.  I have already paid $ 1,100.00 earnest money, almost 500.00 for inspection, 156.00

for electric repairwork and my rent this month was 1035.00, and my car insurance was due so I had to pay another 225.00.

I am afraid I won't be able to close.  I simply have no way to obtain that much money by Friday.  Does anyone have any 

advice?  Thanks.

[Anonymous]

Have you contacted the various insurance companies to see if there's any wiggle room? I was able to knock a few hundred off my initial estimates by adjusting the deductible, lowering my personal property estimate (come on, I don't have $100K worth of stuff to put in the house!), and asking about discounts for the awesome new roof with a 35 year warranty. Dig, dig, DIG, woman! There has to be a way! You can find it!

[Anonymous]

Yes, I have asked for everything.  I called everyone, USAA, the Hartford, my own State Farm who I have been insured with for almost 8 yrs. 

The amount due is the amount due.  I am screwed.  I even checked with a broker.  I checked with everyone.  No wiggle room.

[Anonymous]

Okay, then you need to see about getting an extension on closing if you can't borrow the funds from someone. Our original closing date was June 15th (60 days from when the contract was ratified) & we had to ask the sellers to give us another 45 days due to the USDA dragging its heals on our appraisal. 

[Lemmus]

...as a last resort have you considered putting the insurance on a cc?

[Anonymous]

 I only have a $ 450.00 limit on my credit card.  I qualify for a Direct loan because I am low income.  

I think in this case, the USDA had no idea my homeowner's insurance rate would be so high.  Most

insurance rates are not that much.  I live in Texas, it's high here.  

Perhaps I am just going to have to postpone my closing.  Can't get blood out of a turnip.  I tried 

everything, sometimes my best just ain't good enough.

[Lemmus]

...go speak with your counselor in person ...show them the closing cost estimates you were provided and then your actual quotes ...if they can't help, escalate to their supervisor ...its time to get your mojo on ...they are there for a reason ...they know you don't have 1800 spare cash and they gave you a bad closing cost estimate ...put the shoe on their foot ...there is an answer for you, you just have to be the squeaky wheel for a bit ...really hope this works out for you ...USDA is a tough grind for anyone and to get this close ...ugh.

[Anonymous]

Thank you.  There is wording in the handbook, chapter 7.3 B that 2 months of insurance and taxes is required for escrow.  

In my case, the home is already built and from what I understand the one year paid in full premium is only due for new construction.

My underwriter is not my friend.  She has repeatedly shown contempt and is most unhelpful.  I usually contact her assistant because

she is so much easier to speak to and understand.  She explains everything very well.  

Thanks so much for all the kind replies!