Closing costs and fees are generally thought to be a one-time cost that gets paid at the end of the transaction. However, as most homeowners will quickly discover, there is more than just one closing costs. Depending on the loan program, borrower qualification and other factors, there can be one or several fees at closing.
Types of fees at closing
Typically, there is the loan origination fee, which is usually a flat fee charged by loan officers that are tied to the size of the loan. For example, a $400 fee on a $100,000 loan is more expensive than $400 on a $300,000 loan. Some loan programs charge a higher origination fee for loans with fussy underwriting requirements. To get the full details, check out https://www.webuyhouses-7.com/colorado/we-buy-homes-colorado-springs-co/.
Another type of fee that may be charged at closing is the lender’s credit report charge. This charge varies from lender to lender and typically depends on the size of the loan and if there are any blemishes in the borrower’s credit history. If a borrower is self-employed, some lenders charge a higher fee.
Additional fees at closing
There may be additional fees charged by third parties. One example is attorney’s fee, which is typically paid by the borrower as a percentage of the loan amount. Some lenders will pass these fees through to their customers, but other lenders will absorb these charges into their administration or origination fee. Another example is the home inspection fee. These fees can range from $250 to several thousand dollars, depending on the size of the loan and type of home inspection. For all the latest updates, click here https://www.mobile-home-buyers.com/colorado/sell-my-mobile-home-colorado-springs-co/.
The buyer may also be asked to pay for title insurance, which protects lenders against title defects that are discovered late in the process. A title company will usually charge about $400 for this service and buyers often split this cost with the seller.
Closing costs and fees are negotiable
One of the biggest benefits of buying a home is that borrower often has the ability to negotiate some closing costs and fees. For example, if a buyer’s credit score is high enough and other elements of their application are in order, many lenders will agree to waive the lender’s credit report fee. Also, some title insurance companies will offer discounts for borrowers who purchase more than one property title policy with them.