1. Loan Origination Fee
This is the administration charge for originating the loan.
This charge can be credited by the interest rate chosen which means you are credited bo our lender for this charge.
This results in a NET ZERO points if we apply the credit to your interest rate.
This charge is tax deductable over the term of the loan. Example: $1000 in orgination gives you a $1000/30 year = $33.33 tax deduction per year.
2. Discount Points
An option for you, the borrower, is to pay points to lower the interest rate at which the loan will be repaid.
Each point equals 1 percent of the mortgage amount. For example: on a $150,000 loan, 1 point would equal $1,500.
Discount Points are tax deductable the same as the loan originatin fee.
3. Appraisal Fee
This fee is to pay the appraiser to obtain a value of your property based on the lender's guidelines. In some cases the appraiser must use different criteria for Fannie Mae vs certain bank's guidelines.
Investment properties usually require rent schedules so they cost $50 more.
Houses over $650,000 usually cost $150 more because the appraiser has to measure the home and this takes more time and more complex.
4. Processing Fee
This is the fee we charge our nbrokers for processing their loan. It includes the credit report fee they pay as well as the application fee.
This fee is the total of charges by our lender for Processing, Underwriting, and Funding the loan.
It includes the Tax Service Fee and Flood Cert Fee if not listed separate.
This fee is paid directly to our lenders.
5. Tax Service Fee
This is a fee our lenders charge you for Tax Service which is a standard charge banks pay to execute 4506T transmittals and other Tax Services related expenses. (Sometimes its included in the processing fee and not included separate)
6. Flood Cert Fee
This fee is for the cost of getting a flood certification form to determine if the property is in a flood zone.
(sometimes it's included in the processing fee and not charged separate)
7. Application Fee
This fee is paid to us for setting up your loan and doing your application. It can be refundable or non-refundable according to the Broker Contract. We usually only charge an application fee when we incur significant costs prior to closing your loan.
A. You are required to prepay interest on the new loan for the remainder of the month from date of loan closing or funding if a refinance on a primary residence.
If you close on May 15, you need to prepay interest from May 15 to May 31. The June 1 payment has been prepaid so you skip the first payment since interest is paid AFTER it accrues. When the June interest accrues, it is then paid July 1st which is your first payment.
B. If you close the loan in the first 5 days of the month, your first payment may be June 1. In this case you receive a credit for the first 5 days but you don't prepay the remaining 25 days. They accrue and are paid June 1. So you pay for just 25 days.
C. Refinance prepaid interest
If you are refinancing your loan and do not wish to skip a payment or finance into your new loan the amount of your remaining monthly payment, Simply bring this money to closing. This way, you are essentially making your regular payment when you close the loan. You don't pay your existing lender's payment as it will be a double payment. If you do they will reduce your payoff or you will recieve a refund check.
Taxes and Insurance Escrows
If you escrow(taxes and insurance are paid by your lender each month) we will have to set up an escrow account for payments to be made annually by the lender.
If you waive escrows, the setup for annual payments of taxes and insurance are not collected but if your annual tax or insurance is due to be paid within 3 months of closing, they must either be collected or you must pay them before closing the loan.
2 months reserves plus remaining taxes due. For example. if you are closing in January and taxes are due in November. The number of months of tax escrows will be Nov, Dec, Jan, the month of Feb since payment is included in the closing plus 2 months of reserves. So 6 months will be escrowed.
If you are purchasing a home, you will be credited on page 1 of the closing statement for money the seller owes for the period of time he owned the home. You may be confused why his taxes are being escrowed but you are being credited for them in separately.
1 year of insurance is required to be paid in advance on home purchases. an additional 2 months of reserves will be required to set up your escrow account. This is because your first payment is paid at closing and 1 month is for additional reserve.
If you refinance and your annual renewal is within 3 months of closing, You will be required to escrow the 2 months plus the annual renewal fee or 14 months. If you pay this prior to closing then only 2 months is required. The title company will need a paid receipt from the insurance company.
If you have Windstorm, condo(HO1) insurance or flood insurance, these are treated the same way as regular homeowner's insurance escrows
Condo Dues, Homeowner's dues are not collected by the lender nor are they paid in the loan. Condo dues will be required to be prepaid as required by the association.
Loan closing fee.
This is the fee the title company charges for closing the loan. Recently the title companies closing foreclosed properties are charging up to $850 for this fee. This fee is discretionary by the title company and needs to be verified prior to choosing a title agent. This fee is typically $250
This fee is charged by attorney's who close loans such as in Georgia where it is a requirement for an attorney to close a loan. It is typically $450.
Title Insurance fee.
This is charge for insuring your title against liens incurred prior to purchasing your home or for renewing the title when you close a new loan.
There are 2 types of title insurance, Lender's policies and Owner's policies.
The lender policy only insures the lender for the amount of the loan and is charged at $250 per $100,000 in most states. Florida charges $500 per $100,000.
The Owner policy insures the borrower for the value or the home. It is charged based on appraised value or purchase price. If you get an owner's policy, the lender's policy is reissued for a small fee of $75 to $300 since it's not a new policy.
Typically, a buyer pays for the lender's policy or can split the cost of the owner's policy with a seller. Sometimes the seller pays for the owner's policy with the buyer paying only the reissue of the lender policy fee.
In Florida, having an existing owner's policy will allow the title agent to provide you with up to a 40% credit for reissuing a new lender's policy. So instead of $500 for a $100,000 loan, the fee would provide a $200 credit so that the cost of title insurance is only $300.
Search and Exam
This is the fee for searching for liens and reviewing the title policy. Typically it costs $225 to $300
This fee is to cover the cost of preparing an addendum to a mortgage for anything necessating an addendum such as an interest only loan, a house in a planned unit development, or where the loan is an arm or balloon. A condo requires a condo addendum as well. Typically, this fee is $25
Wire transfer fee
This fee is to cover the cost of the wire transfer of funds. Typically $25
This fee is to cover the cost of sending the closing package to the lender and a duplicate package to the mortgage company. Typically $25
Recording Charges. this fee is charged by the state for recording your mortgage at the courthouse
Deed Stamps or Deed Tax
This fee is charged in Florida for purchase loans. It is charged at .7 times the purchase price and is typically paid by the seller.
Mortgage Stamps or Mortgage Tax
This fee is charged in Florida on new mortgages. It is charged at .35 times the loan amount
This fee is charged in Florida and Georgia and other states. It varies by county in Georgia. In Florida it is .2 times the loan amount but does not have to be paid on leasehold property such as on Pensacola Beach. The Georgia tax is .3 times the loan amount but certain counties charge .2% additional
Surveys are required in Florida. Refinances can use existing surveys. Typical cost is $275 to $400. Properties requiring an Elevation Certificate Survey will double the cost of the survey.
The seller or buyer may purchase a warranty. These are typically paid at closing
Pest or Termite inspection.
On VA refinances and all purchases a pest inspection is required. Typical charge is $175 to $225
This is required on most purchases. Typically $200 to $300 depending on how detailed an inspection is required. The seller or buyer can pay this fee.