cancel
Showing results for 
Search instead for 
Did you mean: 

USDA guaranteed closing costs

tag
matt5566
Member

USDA guaranteed closing costs

My girlfriend and I are getting close to closing our usda guaranteed mortgage. The purchase price is $103000, and the appraisal came in at $115000. I was under the impression that since the appraisal came in higher than the purchase price, we would be able to roll the closing costs into the loan. Our loan processor is telling me that is not how it works, and the loan can only be for the purchase price plus the usda fee, and we cant include closing costs in the loan. Does this sound right, or is something fishy here? Thanks
Message 1 of 2
1 REPLY 1
beanie7132
Frequent Contributor

Re: USDA guaranteed closing costs

For USDA, your lender is correct that it is purchase price + USDA fee. 

 

However, my lender is rolling closing into the loan on a USDA guar loan in exchange for a slightly higher interest rate. We locked at 4.375% several weeks ago. 

I have to come out of pocket for prepaids which is 3 months taxes, 1 year + 3 months HO Insurance, daily interest based on closing date. My GFE quoted 2 days (we close on the 30th). I do not think any loan allows prepaids to be rolled in, I could be mistaken so Ill let the more knowledgable gurus correct me if I am wrong. My GFE estimated closing costs of $1,327.56. Minus the $1000.00 earnest deposit I gave months ago that comes to out of pocket at closing $327.56. 

 

I can update in a few days when we get the clear to close with the actual figures. 

 

Your scenerio will differ of course based on lender, interest rate, HO ins costs, tax amount, ect. I went into this thinking the USDA Guar loan was really a 100% loan...... nope wrong. 

 

Message 2 of 2
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.