Do you realize that your monthly payments include principle, interest, taxes, home owner's insurance and private mortgage insurance? The last one could have been avoided if you had more money to put down. Your HUD statement (good faith closing costs will tell you how much you are paying for what is know as PMI. My last client on a $200,000 mortgage is paying $3,333,00 at closing and an additional $77.00 per month till he meets the ratio set by the bank of 20% equity in the home. Have a quick chat with the funding institution and have them explain the costs. All said you are making a wise investment in your future. Congratulations!

Everything is done. The house was appraised at $251K. My mortgage broker said that he is just waiting on a fax from my student loan lender( I have not called them yet) and then he would submit everything and we would have a committment next week. I'm still waiting on my attorney to call me back so I can talk to her about the sellers contributing to closing costs. I'm hoping she gets back to me before the broker submits everything.

Is the appraisal done?
What's the appraised value on the property?

Carl,
What I want to do is talk to my lawyer about us paying the original $234 and having the sellers pay closing costs. This would save us $17000 on the price of the house. With the concession we do have enough money for closing and we can afford the payment it is just more than we wanted it to be. I just asked the question because I wanted to know if this is something than can be done or if it is completely out of the question before I approached by lawyer with it. So, from your last sentence I'm thinking that this is not completely out of the question and I will be placing a call to my lawyer. Thanks for your help.

It is very confiusing, and this is no place to be definitive. A contract is the world of attorneys and courts, and the law is usually very well decided. The facts can be in dispute but you need legal advice. Oil tanks are seller's responsibilities and the risk of buying without assurance of clean soil can be major. It sounds like you have contingencies on the loan, the oil tank and maybe other things. Negotiation is exactly what is needed if you want to proceed. Normally, based on what you want, your attorney would act on your behalf. If agents and attorneys will not do it, you and seller can meet. You are the principals. Owner/seller must agree, lien holders must agree, contract is written as to terms, money is agreed, date is agreed, must be legal- these are the key elements of a contract. Frankly, if you cannot cover the costs to close, the concession cannot be any larger, and the payment is unaffordable, why are you unsure of what to do? What if the house were about $215,000? Can you handle that? If so, ask seller to re-cast the contract.

Just to clarify. We are not borrowing $251000. The amount we are borrowing is that minus the down payment. And yes, our income is just above $80000.

Carl,
I thought our costs were high, but now I'm confused because the amounts that you are giving aren't close. We are paying 234000 for the house plus the original $100000 concession. The concession is now up to $17000 so the total we are currently paying is $251000. We started with $12000 of our own savings. Our down payment was $8756 and that was 3.5%. Including taxes and insurance our monthly payment is now up to $2100 and seems to keep climbing. I can't have our realtor try to renegotiate because he didn't want to negotiate to begin with. I was hoping that my attorney would help us with that.(She is the one that got the sellers to contribute to the oiltank because my realtor didn't want us to ask for it). Is that normal?

You describe some high closing costs. If you put $9000 down, assuming 3% FHA, the price must be $300,000. So you must be borrowing $291,000. Payments would be about $1644 month plus taxes (?) and insurance.($75). Assuming no flood zone. Income should be $80,000 or more yr. Am I close? The $12,000 concession is tacked on the top of the loan. So the loan then is $303,000 and payments would be about $1712 month plus taxes, insurance. Your attorney will have to be involved. The two agents can do a lot of good by getting together also. Keep us informed.

Wantahouse - There's a maximum amount that the Seller can pay, which is based on the type of loan and the LTV or your down payment. (6% max concession for FHA...and the Seller cannot be putting more money into the transaction than the Buyer.)

What does your Good Faith Estimate say regarding closing costs?

I seriously doubt that your attorney will allow you to change the original contract...that's a red flag.

If you have a mortgage contingency...it may be time to pull the plug.

It may be a very good thing for you that you do not have a commitment from the bank and that is only if you have a mortgage contingency written in your contract. The bank's underwriters may also be finding an issue with the affordability and perhaps that is a reason why you have not been issued a clearance to close, Although this information should have been presented to you by several people you should have computed the monthly payments and determined your comfort level.
Suggest you speak with your attorney and be honest with your situation. The attorney would be the only one who could advise you of consequences.Lastly if the seller paying the closing costs is the only problem standing in your way I would suggest your realtor approach the seller's realtor and negotiate again being very honest. Again caution is necessary to protect your liability so please speak to your attorney before you proceed.

Yes, we were originally told our closing costs including down payment would be $12000. We have already paid our nearly $9000 down payment. We now have the remainder of the $12000 in savings ane were told that the $10000 concession was not enough and we needed another $7000. So we were not planning on closing costs and down payment being almost $30000 between what we had saved and the concession. All of this has brought the original price up so the monthly payment is now $200 more than we were originally told and it seems to climb another $30 every time I talk to the mortgage broker. In addition we still have to pay for the installation of a new oil tank because the old tank was underground. We are first time home buyers and I feel like our realtor could have maybe helped us negotiate better, like sellers contributing to closing or taking care of the oil tank themselves, but now it's at the end and we are getting concerned.

Curious. Just what is your situation? Should you be buying? Can you buy?

Hello
The best advice would be to consult your attorney. After contracts are signed it becomes a legal issue that should be handled through your attorney and the sellers attorney.
We wish you the best of luck.