An Overview of Mortgage Fees
Learn about mortgage closing costs and other home loan fees
When you're ready to buy a home, it's a good idea to research the costs associated with the mortgage process. Aside from the price of the home, insurance and utilities, there are a lot of different mortgage closing costs. We'll detail some of the home loan fees you may face and what they are for, but the amounts of these fees will vary based on your mortgage lender.
Mortgage closing costs and lender fees you can expect to pay
There are many people involved in the processing and closing of a loan application, and all of that work will result in some charges. Here are some of the most common closing costs:
- Appraisal fee: The cost for a certified appraiser to estimate the market value of the property. This is based on property values in the area, recent property sales, building costs, amount of land and other public records. You need an appraisal to obtain a loan. The lender will often arrange for an appraisal and provide you with a copy of the results no later than three days before the close of your loan. A low appraisal could mean you may be eligible for a lower loan or change the terms of your loan, but it could also help you renegotiate your offer on the property.
- Document preparation fees: Lenders may charge you a fee for preparing the loan as well as other legal documents required to close a home. Some of these documents include the deed of trust, mortgage note, and so forth.
- Credit report fee: Charged to cover investigation costs to determine your risk as a borrower. This includes credit reports, employment information and other information necessary to your approval and closing. Before applying for a mortgage, check your credit score and work with your creditors to correct any errors or remedy any issues you identify in your credit bureau report.
- Legal fees: You’ll want an attorney or closing agent to examine the deed and ensure it is valid and you can use the property as you intend. They’ll help make sure there are no tax liens against the property and taxes are accurately valued. When you’re ready to close on a home you may need an attorney to help manage the settlement and submit your mortgage document to the county recording office. You may also have a notary fee charged by a notary public for witnessing your signature on the documents of the sale. This validation is required for your deed of trust to be made legal.
Ask your lender what your specific mortgage fees will cost
Lenders must disclose mortgage closing costs to the buyer in a Good Faith Estimate. You should receive the Good Faith Estimate within three days of applying for a mortgage. This will give a detailed estimate of the mortgage fees you will incur and how much they will cost. A day or two before closing, you'll receive the HUD-1 Settlement Statement, which shows the final, official closing costs.
Apply for a mortgage with Citizens Bank
This is just a brief overview of mortgage closing costs and home loan fees. Learn more about different mortgage rates and options to find the right one for you. For more insight into mortgage lender fees and to start your mortgage application, contact a home loan originator today at 1-888-514-2300.