Mr/Ms Buyer...we all run into rough stretches in life, and sometimes our credit scores tell the tale.
And you've worked hard over the past two years to get past your troubles and rebuild your credit and it's doing much better (it's almost at 600 now).
But you don't have a down payment saved up.
HOWEVER-we found you a lender who is indeed willing to make you a loan! Yippee! At 100%, and we can get the seller to cover closing costs-HOORAY! And the rate is only 7%-not that much higher than market-which is fabulous considering that you still have a ways to go on the credit score and don't have any skin in the game.
So why are you upset that the lender wants to charge PMI? And that it's higher than you expected? The bank has a right to protect itself in this situation-you have to understand that your credit score isn't stellar, and that you will have no equity in the home, and that you are a foreclosure risk (even though you are ready to make the commitment and say that you understand this is a high priority payment if you want to stay in the house).
And why are you upset that the bank requires escrow accounts for your taxes and insurance? They want to protect against potential liens in the event you don't pay those bills-and again, you have NO SKIN in the game.
The banks don't owe us anything, and no, nothing is free in this life (last time i checked!). But if you're serious about wanting to continue the rebuilding process, take the deal-build yourself up by paying on time-and build equity, which is something you can't do in your current rental-and refinance one day or sell and buy your dream house. Don't blame the bank!
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