Walled Lake, MI

Walled Lake Data and information

Is a no cost loan truly a no cost loan? And what is a no cost loan? Every loan has closing costs. Usually every loan has

• appraisal costs
• bank processing or underwriting fees
• title insurance
• tile closing costs
• county recording fees

These fees usually range from $1500 to $2200 on a Michigan mortgage. But on a no cost loan what happens is the mortgage company or the loan officer pays those costs. The mortgage company or loan officer pays for the appraisal cost, underwriting fees, title insurances costs, and recording fees.

How do they do that do you ask? It's easy because the higher the rate a mortgage lender sells you the more they make. So let's say you are getting a 5.25% 30 year loan with $2200 in closing costs. The mortgage lender may make 1% of the loan amount at 5.25%. But at 5.625% the mortgage lender may make 2%. So if the loan officer can sell a 5.625% and make 2% on the loan. Then on a $200,000 the loan officer would make $4000. He could pay $2000 of that money to pay all the closing costs.

So why would you take a no cost loan and get a higher rate? Where most no closing cost loans happen are in refinances with falling rates. Let's say you have a 6 1/8% loan that you got last year. It doesn't usually make sense to refinance unless it is a full percent drop.

It doesn't usually make sense to refinance because of the closing costs if you don't have a 1% or more drop in the percentage rate. But what happens if you could save $50, $60, or $70 a month and it wouldn't cost you a dime.

That's why consumers use no-cost loans. It reduces their monthly mortgage payments without costing them a dime. But one downside of no cost loans or any refinance is that you start the clock over. You now have a new 30 year mortgage.

So the bottom line is the loan officer doesn't make more money on a no-cost loan, but it may make sense for you. Figure the numbers out, compare a no-cost loan to a cost loan and decide which is better for you. So you can usually get a better rate when you pay the closing costs than if you got a no-cost loan.

I hope this explanation helps

Russ Ravary your Metro Detroit real estate agent

What should I be looking for is a common question I get from Oakland County first time home buyers? What I tell them is you should be looking at the structure and the updates. You need to look at the items that are going to cost you a lot of money. Here are the seven big items (and one smaller one) you should be looking at.

1. Roof - How does the roof look? Are there shingles missing? Look at the valleys in the roof. Are the shingles curling on the edges? Is there one or two layers of shingles. This give you a general idea of whether you are going to need to replace the roof in the next few years.
2. Windows - Are they old? Do they need replacing? How is the wood around the windows?
3. Exterior siding or woodwork? Is it rotting or do pieces need replacing? Or does it just need painting?
4. Kitchen - does it need to be updated. A kitchen that needs to be updated is one of the most expensive costs in the house.
5. Bathrooms - does it need to be updated. A bathroom update can run up from $4000 to $10,000.
6. Basement - is it dry or is there signs of water? Now depending whether it is a block basement or a poured wall basement depends on what is will cost you to repair a wet basement. Many times a Oakland County foreclosure will have the power shut off and the sump pump will back up. Then their will be water in the basement. A poured wall basement is usually easier and less expensive to fix water problems than block basements.
7. Furnace - how does the furnace look. Is it old or rusty? Many times you can't tell about the furnace until the inspector checks it out.
8. Water heater - the water heater usually has a manufacture date on it. This is the least expensive. You should be able to get one replace for about $500 - $700 depending on the size.

As a Oakland County first time home buyer you need to check all these items out. You don't want to buy a home that going to cost you a ton of money to upgrade or to bring the home up to date. If you can buy an updated home for less than what it would cost you to upgrade the home then it may be smarter to buy the upgraded home. Of course you have to be able to afford the upgrades more expensive house too.

Whether you an Oakland County first time home buyer or an experienced home buyer looking at these eight items and determining which ones need attention. The more items that are good the better the house as far as I am concerned.

Russ Ravary your Metro Detroit real estate agent

Search Metro Detroit homes for sale

Oakland County first time home buyers part 1 - pre-approval letters MI

Oakland County First time home buyers part 2 - where to start and do next

Oakland County first time home buyers part 3 - how to read listings and pick houses to see

Oakland County first time home buyers part 4 - what to look for when looking at homes

Walled Lake Data and information

Walled lake is about 670 acres all sports lake that is 53 ft deep in the deepest spot.

More information about Walled Lake Oakland County MI

The lake is just 5 minutes from Novi's Twelve Oaks mall. Plus it is easy access to I-96 express way and Maple Rd can take you all the way to Birmingham. North of the lake is M-59 is you need to go North and west.

If you are looking to buy Oakland County waterfront property Walled Lake is a nice area. Give me a call on my cell or email me and I'll send you some waterfront home listings in your price range.

Russ Ravary your Metro Detroit waterfront real estate specialist serving Oakland County lakefront properties and Livingston County Lakefront homes

cell 313-310-9855

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