How does our loan quote look?

[Chad S.]

My wife and I are looking to invest in a multifamily building on the north side of Chicago. We'll go from renting, to being landlords in an owner-occupied 3 unit building. Our real estate agent recommended someone at Guaranteed Rate for the loan approval. We met with him today and found out that we can get a 5% down conventional loan which is nice, because we thought we would have to go FHA. It was a lot to take in and we're not sure how great the overall loan terms sound. We can probably do about $40,000 for a down payment, and could qualify for around $650k this was just an example they gave.

Loan Program Quote

• 5% Down
• $500,000 purchase price (example)
• $25,000 down
• Interest Rate 4%
• APR: 4.360%
• Product: Agency Conforming FHLMC 30yr fixed Home Possible AMI > 80%

Example Monthly Breakdown

• Principal & Interest: $2,267
• Insurance: $150
• Taxes: $677
• Mortgage Insurance: $170
• Total: $3265

Other

• Lender Fees: $1,190
• Appraisal Fees $450
• Prepaid Interest: $780
• 1yr insurance premium: $1,800
• Insurance Escrow Reserves: $300
• Tax escrow reserves: $4,602
• Title Fees: $1,000
• Owner's Title Insurance: $2,000
• Lender's Title Insurance: $1,500
• Transfer Taxes: $3,750
• Recording Fees: $168
• Total: $17,000 (according to the broker we'll get about $10,000 of that back in the first year)

Do we need a second opinion or do these numbers sound fair? Curious if anyone has any input.

[Charlie Fitzgerald]

That is a very good program and rate and all costs and fees look like they are in line and accurate. GRI is a very well respected lender and does a great job.