Closing costs come as a huge surprise to some people – especially first time homebuyers. If you are saving for a down payment you may wind up dedicating a large chunk of what you saved to the closing cost. There are some grants and loans available that are dedicated to closing costs specifically. These grants and loans may be on the local, state, and even federal level. These grants and loans may be up to thousands of dollars!
We would recommend you ask your real estate agent or loan officer for what types of programs may be available in your area. Do not dismiss looking into these options – they are not for first time home buyers only. They are also not specific to low or moderate income buyers, either…especially in cities that are very expensive.
You can also look at options at your Housing Finance Authority in your state. Through the Housing Finance Authority, the options are usually for first-time home buyers, but again, that is not always the case. And if that is how it is in your state, they may be able to give you other resources or places to take a look. Some of the fine print may also be that you have not own a property in the last three years.
If you are unable to find any assistance, you may want to think about asking the seller if they would b willing to pay for some of the closing costs. This is actually a common practice. If this is what you wish to do, work with your real estate agent so they can negotiate – they may have experience in it as well.
Another option, which some do not like, is to have your lender add the closing cost into your loan. If you decide to do this, keep in mind that your interest rate will likely be higher. This option is known as lender credit.
We would be happy to help you explore these types of options if it is something you are wanting to explore!