Mortgage! Mortgage loans! What are closing costs? Do all mortgage loans have them? Why are there so many closing costs? Are all mortgage loans like this? The Mortgage Pro explains loan fees for a mortgage and all mortgage loans closing costs! This video explains mortgage loan closing costs explained in an easy to understand manner about home loan fees. Mortgage Closing Costs can add up to thousands of dollars so understanding mortgage loans & what are closing costs for a buyer can eliminate stress and uncertainty through the mortgage loan process. There is no shortage of real estate fees on mortgage loans so watch and learn! Common closing costs for a mortgage are Processing, Underwriting, Origination or discount points, Appraisal, Credit report, Escrow or Attorney fees, Title insurance, recording, notary and many escrow companies and title fees have numerous add-ons such as loan tie in fee, printing fee, electronic BS fee (sounds like a lot of BS from title and escrow - that part is!) and there are other fees depending on the companies chosen.
Most reputable companies will only charge you a processing and underwriting fee, Points can be charged based on the rate chosen. In most cases, you can have a higher interest rate to reduce or eliminate these fees. The rest of the fees, go to other companies and have nothing to do with the mortgage lender.
Other costs associated with a mortgage loan such as pre-paid interest - which is interest charged per day from the day you close the loan until the last day of the month. Close on the 15th and pay 15 days interest, close on the 25th and pay 5 days interest etc. Property taxes vary by state and by the month of the year. t of Appraisal Fees, Credit report fees, and possibly points.
Points are a direct result of the cost of the interest rate on the day the loan was locked. The more the points paid - the lower the rate. The less the points charged- the higher the interest rate. This is very standard in the mortgage industry and this see-saw method is used by every bank that does mortgages.
Appraisal fees. These fees are paid directly to an appraisal management company which is a requirement by federal law. The appraisal management company pays the appraiser.
The fees will vary from one escrow fee for a refi loan and a much higher fee for a purchase. There is more work for a purchase loan than for a refinance transaction so the fee is usually justified.
Attorney fees as you probably already expected are considerably higher than the escrow fees.
Again, the mortgage company does not receive the attorney or escrow fees. They are paid directly to those entities.
Some (but not all) of what are often called junk fees are:
Doc Printing fees (I've seen printing 75+ pages as high as $250)
Wire Fees
Email Fee
Loan Tie in Fees
Endorsements
Courier Fees
And more.
Some are reasonably legitimate, others... not so much!
Title Insurance, while certainly necessary, these fees are paid to the title insurance company, not the mortgage lender.
A short list of their potential fees are:
Title - Closing/Settlement Fee
Title - Lender’s Title Insurance
Title – Title Exam/Search Fee
Title – Deed Preparation
Title – Closing Protection Letter
Title – Courier/Wire
Title – Tax Report
Title – Doc/Processing Fee
Other fees that do not go to the mortgage company: Notary fee, Recording fees, and others.
Now if that is not enough, there are other costs that are not considered fees! What is the difference? These costs are prepaid interest on the mortgage, Homeowners insurance (usually 1 year and 3 months up from to close the loan) and lastly property taxes. The amount of property taxes collected in California (it may be different in your state) ranges from State to state but can be as little as 2 months or as much as 10 months.
The explanation of what are closing costs are included in this video including all fees of a mortgage. Credit reports fees
loan fees
underwriting fees
title fees
escrow fee
attorney fees
appraisal fee
processing fees
recording fees
notary fees
rn.
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Rebecca Taylor
REALTOR®
Cal DRE #02086366
626.400.6733
eXp Realty of California, Inc.
Want to buy a home in Rancho Cucamonga, Inland Empire, San Bernardino, Riverside, LA County, and Orange County? Know that you’re getting the best deal and not making the rookie mistakes when it comes to buying a home. Call the pro.
Chris Trapani "The Mortgage Pro"
NMLS# 240870
Cell: 310-350-2546
EZ Fundings Home Loans
8577 Haven Ave
Suite 210
Rancho Cucamonga, CA 91730
909-772-8561
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