Ok I have a question I am kinda confused and my lender has yet to get back to me. In nov we were gonna close on a house with the seller paying closing costs. in this was of course the amount of 2010 taxes and homeowner’s insurance. since the seller was paying this my lender told me this amount would be credited back to me, bringing my total amount i had to bring to the closing table down by that much.
well the seller backed out. anyway we put a contract on another house we found, with the seller paying closing. my question is, would the same situation be in effect, being credited for a years worth of taxes/insurance, even though its the beginning of 2010?
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no the seller will credit back to the taxes good through close in every case. This does reduce what you must bring to the table to close.
I am a mortgage banker in TN
Each transaction is separate from any other transaction. You need a good faith estimate from your lender. Everything is different except you have the same lender and you are the buyer. It is a new seller who may not be able or willing to help with closing costs, the price is probably different, the lender may have to adjust the interest rate and so on.
Get a good faith estimate and then you will have a good idea of how much money you have to bring to closing although you will be notified to the penny by the closing company about 24 hours prior to closing.
Usually at closing taxes and insurance are prorated to the day of closing. In my State, the day of closing belongs to the seller.
So for example if you closed on the purchase on February fifteenth in Illinois, your closing costs would be reduced by a credit for expenses up to and including February fifteenth. Everything after that date would be your responsibility as the new owner of the property.