Quote:
Originally Posted by whartonjelly
When you get qualified for a home loan ,do you then subtract the bond amount to be sure you can make payments?
Example. the house costs 200. the bond 20, down payment 40.
What would I be looking at. Does the bond have to be paid off immediatley or does it keep accumultating interest so that it is never reallly paid off?
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The bond is not included in the down payment requirement. It has a schedule of payments similar to the mortgage itself and the escrow (if you have one) will include enough for the bond along with the insurance in your monthly payments. The bond will also depreciate each year just like the mortgage amount and you'll have the option to fully pay off the then current balance of the bond once a year. The bank will make the annual payments for both bond & insurance when they become due. Hope this helps!
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