Closing costs -- HOW MUCH???
Got a question -- have a family member who is looking to purchase a rental from someone she knows, and is seeking to refinance her own home. Her lender is supplying terms for the rental property which... simply put I don't think any sane person would agree to. It takes a property which is under-priced by about 15% and converts it over to a negative cashflow nightmare for the next 12 years. I am telling them to avoid that deal like the plague, although I have no idea where to suggest alternative financing.
As for her own property, they are willing to refinance her at a slightly lower interest rate, and switch it over from 26 remaining years to 15 with lower monthly payments. The savings are nice--the kicker is she must pay $5K of closing costs up front to refinance. Mind you, this is property she already owns, and is living in. They want $5K certified check up front to close on her house she is already living in.
I can't get past the point that her own lending institution is charging her $5K up front for closing when closing is nothing more than telling their computer system to drop her rate a smidgen.
Am I being unreasonable, or are they?