A. CREDIT REPORT $50
The credit report is integral to the loan
approval and is a fixed cost. The report contains your credit
information as reported by the three major credit repositories,
Experian, TransUnion, and CBI Equifax. As well, it checks
for tax liens and other outstanding judgments.
B. APPRAISAL REPORT
$350
The appraisal report is mandatory and
costs roughly $350 for single family dwellings. This could
vary depending on your locality, property type, and size
of the property. The report estimates the value of your
property, as determined by recent “comparable” transactions
in your locality.
C. PROCESSING FEE
$450
This fee is a fixed $450 cost and is paid
to a processing company, who packages your deal, including
meeting all lending institution compliance requirements,
and corresponds with the lending institution until your
deal is funded.
D. TITLE FEES $500-1,500
Title fees will vary with each transaction.
The major fee is the actual title insurance policy, which
is positively correlated with the loan amount (i.e. the
higher the loan amount, the higher the title insurance
policy cost). On purchase transactions, this title insurance
policy cost is often split between buyer and seller and
is completely negotiable. Other title fees, which are
minor compared to the actual title insurance, may include
(but are not limited to) recording fees, reconveyance
fees, special endorsements, etc.
E. CLOSING FEES 500
(refinance) up to $3,000 (purchase)
Depending on the state, this function
is handled by either an escrow company, title company,
or law firm. In California, escrow is mandatory
on first trust deed transactions (it may be avoided on
certain second trust deed and equity line transactions).
This fee is payable to the closing company, who acts a
neutral party, assuring you (the borrower), the broker,
and the lending institution are in agreement concerning
loan and sale transaction details. On purchase transactions,
the escrow fee is often a percentage of the purchase price
and again, it is completely negotiable between buyer and
seller.
F. LENDING INSTITUTION
FEES $500-800
These are fees charged by the lending
institution that is underwriting the deal. The primary
fee is the actual underwriting fee. Each lender will call
their fees by slightly different names. For example, one
lender may have one flat $800 underwriting fee, whereas
another lender may have four fees that total up to approximately
$800. Common names for some of these fees are wire transfer
fee, tax service contract fee, loan document preparation
fee, etc. The important point here is the bottom line
cost of all lender fees.
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