No Closing Costs loan

Home

Residential Loans

Commercial Loans

Personal Finance

Apply FREE

Mortgage Tips

Real Estate Investing

Contact Us

"Is There Such a Thing as NO Closing Costs?"

Do you have a Real Estate question? Wondering about financing a property, personal finance, improving your credit , managing your debts, buying, selling, or real estate investment? Send your inquiry to The Mortgage Guru.

Article: "Is There Such a Thing as NO Closing Costs"
By Andre Plessis

"Is There Such a Thing as "No Closing Costs?"

This table fees was taken from a lender’s website (except for the "TRUE CLOSING COSTS" column) advertising its rates and fees on a conforming 30-year fixed loan. Here is the PROOF that there is no such thing as "NO CLOSING COSTS". If you’ve ever wanted how they do it then here is the answer in black and white.

Interest Rate	Points: (1 point equals 1% of the loan amount)	APR	Mortgage Monthly Payment	Advertised Closing Costs	TRUE CLOSING COSTS
5.625%	Pay 2.000	5.872%	$1151.32	$6804.74	$6804.74
6.000%	Pay 1.250	6.181%	$1199.11	$5335.99	$17204.4
6.125%	Pay 1.000	6.282%	$1215.23	$4846.41	$23007.6
6.250%	Pay 0.500	6.361%	$1231.44	$3856.83	$28843.2
6.275%	Pay 0.000	6.429%	$1247.74	$2867.24	$34711.2
6.625%	Pay 1/2 Fee	6.625%	$1280.63	$552.09	$46551.6
6.750%	$395 Flat Fee	6.769%	$1297.20	$957.50	$52516.8
6.875%	Rolldown w/o impounds+	6.875%	$1313.86	$572.92	$58514.4

A point is 1% of the loan amount. If you borrow $100,000 and you pay 1 point to get a lower rate, your point = $1000). If you borrow $200,000 and you decide to pay 2 points to get 5.625% rate (See above table) you will pay 2 x $2000 (2 points) = $4000 upfront fee.

6.000% - $1199.11 - $1151.32 = $47.79 x 360 months (30 year) = $17204.4 CLOSING COSTS

6.125% - $1215.23 - $1151.32 = $63.91 x 360 months (30 year) = $23007.6 CLOSING COSTS

6.250% - $1231.44 - $1151.32 = $80.12 x 360 months (30 year) = $28843.2 CLOSING COSTS

6.275% - $1247.74 - $1151.32 = $96.42 x 360 months (30 year) = $34711.2 CLOSING COSTS

6.62% - $1280.63 - $1151.32 = $129.31 x 360 months (30 year) = $46551.6 CLOSING COSTS

6.75% - $1297.20 - $1151.32 = $145.88 x 360 months (30 year) = $52516.8 CLOSING COSTS

6.87% - $1313.86 - $1151.32 = $162.54 x 360 months (30 year) = $58514.4 CLOSING COSTS

As you can see on the above table if you do not want to pay closing costs or a small fee upfront you will end up paying a lot of money over 30 year. You will end up paying the closing costs many times over. If none of the above makes sense, use this simple rule of thumb: If you plan to stay in the house for less than 3 years, do not pay points. If you plan to stay in the house for more than 5 years, pay 1 to 2 points. If you plan to stay in the house for between 3 and 5 years, it does not make a significant difference whether you pay points or not!

Andre Plessis

Andre Plessis
"The Mortgage Guru"
"A Mortgage Professional whose primary goal is to provide the expertise, guidance and skills necessary to obtain the best mortgage to meet your personal needs".
View Client Testimonials

P.S. If you are at all intimidated or unsure about the mortgage process if you don’t understand how to evaluate your options in getting a mortgage loan our 15 key questions will help you feel comfortable that you are making the best decisions. Also if you are in the process of refinancing your home with anyone, CALL ME and I will let you know if you are being offered the best loan option based on market conditions and your financial situation.

Apply Free Today

It's All About You!

Phone: 1-877- APPLYFREE / Direct: 1-818-341-2972

Address: 20235 Keswick Street Suite 321 Winnetka, CA 91306 Yahoo Map

© 2005 by Apply-Free. All rights reserved
No part of this website may be reproduced or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without prior written permission of Apply-Free.