Unfortunately, a lot of lenders use estimates for common costs like property taxes, homeowners insurance, and tax prorations. These estimates can be off by thousands and can cause two potential problem scenarios for first time buyers.
The first being if the lender estimates the costs too high and you don't have enough verified cash to close. This will lead to a denial letter and prevent you from buying the home you want for no good reason other then the lender being lazy and using estimates to do bad math.
The second scenario is if the lender estimates too low causing you to bring more money to close than you anticipated. This buying scenario is more common and can really make things hard on first time buyer loans.
The worst part about this second scenario is that you don't really find out if your lender used estimates until maybe a week before you close. Imagine finding out four days prior to close that you need an additional $1,000 or $2,000 dollars to close. This causes a lot of unnecessary stress about where you're going to come up with the extra money needed to buy your first home.
If you'd like to get pre-approved for the best first time home buyers program call (248) 674-6450 right now or simply click here. Also, for more information on first time home buyer programs in Michigan, keep reading.