Re: Financing Contingency Issue



Given that (a) 6.75 is a very good rate (with 7% being the
midpoint of what I call typical rates) and (b) 6.75 is a
market rate (as opposed to a high risk rate), I think backing
out was a pretty poor thing to do. If a 1/4 point make all
that much difference in your ability to purchase the place,
then I suggest that you are looking at something that is far
more costly than what you can afford.

-john-

John,

Actually 6.75% (I assume this rate is a no-points purchase loan) is not
a very good rate, it is a very high rate even for the today's market
(Yes, it is a very good rate historically speaking).

Furthermore, a half point difference in interest rates yields the
following consequences:

- Additional monthly payment of approx. 69 dollars.
- Additional annual payment of 828.00
- Additional lifetime payment of 24,840.00
- Additional mortgage interest payment of 24,622.85

That little lender "error" could cost the OP a whopping 49,462.85 over
the life of the loan if they had chose to execute.

That's a 5 figure gotcha if I ever saw one.

Regards,

Scott Miller
National Commercial and Residential Lender/Broker
1.877.716.6495
EZMortgageLoanz@xxxxxxx

www.RealEstate-IQ.com
www.EZMortgageLoanz.com

.