The no closing cost loan
There is no FREE money. Here is how it works:
Option 1
Provide a lender credit to offset the amount of closing costs.
This is done by a higher interest rate which may or may not be right for you.
Option 2
Roll the closing costs into the loan amount.
You are then financing them and paying interest on that amount for as long as you keep the loan.
When does it make sense?
If you will not stay in the home or keep the loan for a long time
If you don’t have the money for closing costs or it depletes your savings by doing so.
Can this money be used more productively elsewhere? (Invest, pay off other debt, savings, etc.)
