All Forum Posts by: Ethan Kramer
Ethan Kramer has started 14 posts and replied 37 times.
Post: $12,400 closing costs for $129,900 property?
- Posts 39
- Votes 29
UPDATE: I talked to a mortgage specialist from WellsFargo and I was able to secure a 3.25% interest rate and 15 years at 25% down payment with zero origination fees. Only around $195 per month more than the 30 years term at 4% interest rate, so I decided to go with 15 years, especially that the property will rent at around $1,500 per month. So glad I asked you guys, it is truly important to shop around!
Post: $12,400 closing costs for $129,900 property?
- Posts 39
- Votes 29
Originally posted by @Joe S.:
Originally posted by @Ethan Kramer:
Originally posted by @Theresa Harris:
How much of that is property taxes and utilities?
$4,200 in taxes (prepaid costs), $8,200 in closing costs
So it’s 8,200 in closing cost.
You are correct.
Post: $12,400 closing costs for $129,900 property?
- Posts 39
- Votes 29
Originally posted by @Jonathan R McLaughlin:
@Ethan Kramer Yowie. Are your attorney's fees included in that? Was there anything particularly unusual about the deal such as a phase 2 environmental etc?. I would call and ask for an explanation of the charges on the settlement statement before you call around, so at least you will compare applies to applies. You mention both 3600 in prepaids and 4000 in prepaid taxes so I'm a bit confused. I'm not a big fan of shopping rates and terms for .25%s and a few hundred bucks but that is really pretty steep. How is your credit? Those seem pretty punitive terms at 20%. Its a small loan, so I'd imagine fees are high but...
My apologies, I just reviewed with the lender and the major fees are:
$2,850 origination charges
$1,100 underwriting fee
$1,949 transfer taxes
$2,310 property taxes and homeowners insurance
$900 homeowners insurance premium
Total Loan Costs (A+B+C): $6,220
Total Other Costs (E+F+G+H): $6,169
My FICO is 714
Post: $12,400 closing costs for $129,900 property?
- Posts 39
- Votes 29
Originally posted by @Angelo Forzano:
@Ethan Kramer you mentioned lender I'm curious are you using a mortgage broker or are you working directly with a bank?
Mortgage broker. I have reached out to PNC and will talk to them tomorrow morning. Hopefully I will find something significantly better.
Post: $12,400 closing costs for $129,900 property?
- Posts 39
- Votes 29
Originally posted by @Theresa Harris:
How much of that is property taxes and utilities?
$4,200 in taxes (prepaid costs), $8,200 in closing costs
Post: $12,400 closing costs for $129,900 property?
- Posts 39
- Votes 29
Originally posted by @Joe Splitrock:
@Ethan Kramer ask them to provide a sample settlement statement with estimated costs by line item. What type of loan is this? Is it a conventional mortgage or some type of commercial loan? Take out the $4000 origination fee and drop the rate below 4% and you are more in the realm of reality.
Conventional mortgage. Thinking the same thing, thank you so much!
Post: $12,400 closing costs for $129,900 property?
- Posts 39
- Votes 29
That's what I thought, the numbers seemed way too off. Thank you, guys!!
Post: $12,400 closing costs for $129,900 property?
- Posts 39
- Votes 29
I'm currently under contract for a turn-key investment property in Baltimore City that is valued at $129,900. I just received the documents from my lender showing total estimated closing costs of $12,400, making the estimated cash to close $38,400. I am putting down 20%.
$8,200 closing costs
$3,600 prepaids
The interest rate is 5%, almost $4,000 origination charges. I feel like it is too much? Should I look for another lender?
Post: Possible to purchase 10-unit apartment bldg. using future income?
- Posts 39
- Votes 29
@Steven Foster Wilson Thank you so much for your helpful response. I totally forgot that I couldn't get more than 4 units through FHA.
Post: Possible to purchase 10-unit apartment bldg. using future income?
- Posts 39
- Votes 29
Right now, I have a property in Baltimore that has been generating income since September 2019. Once I have 2 years of experience as a landlord in September 2021, would I be able to qualify for something like a 10-unit apartment building that costs $1.5 million using the future income? I plan to use FHA for this kind of purchase too.
Currently, my income to debt ratio is about $3,500 to $1,100 (I split the $1,100 mortgage 50/50 with fiance and have no other expenses). Let's say the 10-unit apartment building is fully leased at $15,000 per month. At 75%, would I be able to add future $11,250 / month income to my current income to debt ratio to help me qualify for the apartment building? Is this possible?
If it helps, my primary residence, where the $1,100 / month mortgage comes from, is valued at $310k and I have $150k equity in the property. I am willing to rent it out at $2,500 / month and move into the apartment building for one year to meet the FHA requirements. I am also willing to refinance or HELOC the $150k equity if it will help with the $70k cash I have saved so far.
Thank you so much for your time in reading my question. Stay safe and happy investing!