We found out we need to bring more money to our closing...?

Question

Our loan officer told us that our closing costs shouldn't be more than $2500. He told us to be prepared to pay $3000 as a worst case scenario. He called me today and told me that we need to bring a cashiers check for $3060. This is in addition to the earnest money of $1000 we paid. This is $1500 more than he said it should be. He explained that it had to do with the time of year we are buying(taxes) and the fact that we are skipping Septembers payment(we are closing on August 1st). This just seems a bit strange to me. Shouldn't he have been able to tell us a more accurate amount?

Answer 1

Amazingly, this broker is not lying to you.  It is definitely dependent on when you're closing.  If you had closed on July 31st, you would not have to pre-pay 30 days of insurance.  By closing on August 1st, you'll owe the mortgage company that entire month of interest up front.

You're lucky to have such low closing costs, I bought an inexpensive condo and mine were $8,000 (broker estiamted $5,500).

Answer 2

The exact numbers depend on your date of closing since the reserve accounts and prepayments will vary.  Did you get a Good Faith Estimate with your actual closing date on it?  If so, that number should be fairly close.  The good news is that you won't have to make a payment for two months.

Answer 3

You should ask your lawyer how much to bring. They charge you as well when you close. So you will need more money than that. when were you told to bring 2500? I asked my lawyer a week before we closed and they amount was a bit more than we had expected. But we brought the right amount.

Answer 4

This is most likely due to the fact that you are closing on the 1st and not the 30th or 31st.  When you close you pre-pay interest that will accrue that month. So what happens is that your lender ask for more closing cost to cover the interest for the date the loan is recorded through the end of that month.  Upfront costs are always cheaper if you close at the end of the month.  Maybe you can push back the closing date.  Best of luck!!

Answer 5

You should have gotten a good faith estimate from your mortgage company and thats what you go by. It should have told you everything on that!

Answer 6

unfortunately, no. i have been through a similar ordeal and everything depends on the day of the month you move, and that is how the taxes are calculated! it seems like they should come up with a better way to handle closing costs!

Answer 7

You had nothing in writing, just a person saying "shouldn't be more than xyz". there is no guarantee is approximates.

Just pay it be glad it's over.