They can not be utilized as part of the down payment on the loan. Any loans which are marketed as having "no closing expenses" usually have unfavorable points embedded in them where the cost of coming from the loan is paid through a higher rate of interest on the loan. This charge should be disclosed on your Loan Quote (LE) and Closing Disclosure (CD).

When you get unfavorable points the bank is wagering you are most likely to pay the higher interest rate for an extended amount of time. If you pay the greater interest rate throughout of the loan then the bank gets the winning end of the deal. Lots of people still take the deal however since we tend to discount the future & over-value a lump sum in the present.

moved here