Rolling closing costs into mortgage....

*UPDATE*

We can't do it, I spoke with our mortgage guy. Seems like the best choice overall. Thanks for all the advice! would you?
Could you?
Should you?

We didn't think about this when we went into contract, and I am thinking I would like to. Can we? Has anyone done this after the fact? (we should be closing any day now)

Any reasons we shouldn't?

Message edited 9/14/2009 2:06:33 PM.

Re: Rolling closing costs into mortgage....

We did - we never would have been able to buy the house we did if we didn't.

The house just has to appraise at the total mortgage amount - including the closing costs.

Re: Rolling closing costs into mortgage....

Actually, what we did was: our down payment went towards our closing costs. So we had very little out of pocket for closing costs when we got to closing. It allowed us to have more money in the bank for renovations.

Re: Rolling closing costs into mortgage....

Re: Rolling closing costs into mortgage....

Sounds like the program you applied for requires a 10% downpayment. If you are closing anyday now, it would be hard to chage things at this point. Banks are going over everything with a fine tooth comb at this point and if you try to change the amount this late in the game, they will want to re-underwrite your file- which will hold up the closing. You were approved for your mortgage the way you applied. Changing things at the last minute will just cause dealys.

If you can wait a few weeks, then I would call the mortgage person and ask what he can do.

Re: Rolling closing costs into mortgage....

I did not want to. I did not want to pay interest on anything more than the balance of the cost of the home.

we just waited and saved the few more months until we knew we had the $$ for the closing costs, the dp, and a small cushion.

it was hard and scary to think a house we wanted could be purchased by someone else...but we knew we'd find something to love when the time came.

I just didn't want the 12k or whatever stretched out over 30 years at 6%.

I don't roll ANY extra costs into the principal of a loan.

Re: Rolling closing costs into mortgage....

I wouldn't because you will be paying interest on that amount for the next 30 years.

Let's assume a 300k mortgage. Total interest paid over the life of the loan: $418,526

Add on 12k in closing costs now you have a 312k mortgage. Total interest paid over the life of the loan: $435,267

Your closing costs just cost you $4,741 more because you decided to roll them into your mortgage.

No thanks. The goal with a mortgage is to pay the least amount you have to over the life of the loan. That usually means the shortest term, and lowest amount to morgage that you can afford.