Find The Hidden Costs On Your Closing Statement
And
You Might Save Yourself Thousands Of Dollars
Most people, either through ignorance or apathy, accept closing costs and fees for granted or just pay what they are told. They simply assume the title or mortgage company is looking out for their best interests so they shrug their shoulders and pay the costs associated with a mortgage closing. That way of thinking may be dangerous and costly when it comes to closing costs. Mortgage and title companies are in the business of making money and they have no qualms about padding the deal in their favor.
To protect and educate yourself have your mortgage broker explain to you what each cost means, and why you are paying it. If you can, and I strongly recommend it, hire a real estate attorney to guide you through the whole process. They will protect you from making any costly mistakes. Surprises at the last minute are what you are trying to avoid.
All too often consumers receive a call from the title company on the day of the closing. They are letting you know your closing costs are going to be a bit higher than originally expected. Their explanation is there was a mistake made in calculating some of the fees, and you need to bring more money to the closing. This is a common ploy used by title and mortgage companies to take advantage of your emotional state at the time. They know especially if you are refinancing to stop foreclosure that you are in a highly charged emotional state and simply want the whole thing to be over. They are calculating that by informing you at the "11th hour" of the increased costs you'll simply bite the bullet and agree to the new cost.
As hard as it may seem at the time it is in your best interest to delay the closing. The mortgage or loan company will likely try to coerce you into continuing; perhaps saying you are legally bound to close on a certain date. This is not true, especially if the terms of the contract have been altered without your consent. Inform them you are going to postpone while you further investigate the reason for the increased fees. If you have hired a real estate attorney inform them of the change immediately.
If you wish to avoid a situation like this, it's a good idea to understand what the costs and fees are, how they are calculated, and why they have to be paid. Below are some common closing costs and fees with a rough estimate of average cost:
Property Appraisal – Confirms the fair market value of the home. Typically costs up to $500
Personal Credit Report– For obtaining your credit history and score. Typically costs from $20 -$30
Closing Fee - This is paid to an independent party, usually the title company or an attorney, to conduct the closing. Depending on your state of residence it may be required that a real estate attorney be present at the closing. Typically costs $400 - $500
Title Search - This fee is paid to the title company for doing a thorough search of the property's records. The title company researches the deed to your new home, ensuring that no one else has a claim to the property. Title search costs vary per Title Company.
Survey Fee - Verifies all property lines. Typically costs up to $400
Flood Zone Determination - This is paid to a third party to determine if the property is located in a flood zone. If so the insurance is purchased separately by the buyer. This fee widely varies depending where you live. You may pay as little as $20, or up to several hundred depending.
Courier Fee - This covers the cost of transporting documents to complete the loan transaction as quickly as possible. Typically costs between $20 - $40
Lender's Policy Title Insurance - Assures the lender that you own the home and the lender's mortgage is a valid lien. Typically cost between $500 - $1000
Owner's Policy Title Insurance - Protecting you in the event someone challenges your ownership of the home. Typically cost between $500 - $1000
Homeowners' Insurance - This covers possible damages to your home. Typically costs start around $400 and go up.
Buyer's Attorney Fee – Not always required. Different costs are associated with this fee from state to state. Typically costs $400 and up.
Lender's Attorney Fee – Not always required. Different costs are associated with this fee from state to state. Typically costs $150 and up
Escrow Deposit for Property Taxes & Mortgage Insurance - Often you are asked to put down several months of property tax and mortgage insurance payments at closing. The amount varies according to the value of the home.
Transfer Taxes - This is the tax paid when the title passes from seller to buyer. This fee varies widely depending on the state or municipality.
Recording Fees - A fee charged by your local recording office, usually city or county, for the recording of public land records. This fee varies widely depending on the municipality
Processing Fee - This goes to your lender. It reimburses the lender for the cost to process the information on your loan application. Typically costs up to $1,000
Underwriting Fee – A fee paid to lender to do research to determine whether or not to approve the loan. Typically costs up to $800.
Loan Discount Points – These are prepaid interest. One point is one percent of your loan amount. This is a lump sum payment that lowers your monthly payment for the life of your loan. Amounts vary according to the number of points you pay.
Pre-Paid Interest - This is money you pay at closing in order to get the interest paid up through the first of the month. These costs vary depending on loan amount, interest rate and time of month you close on your loan.
Victim or Victor – the Choice is YoursYou could lose everything or you could come out of this with more than you ever thought possible. It all rides on your decision to contact us. The sooner you do that, the better the outcome. Get started and stop foreclosure now by answering a few questions for us . To Talk to Someone Now Call: 1-888-I-SAVE-80 There's no obligation. In fact the initial consultation is FREE. And that may be all you'll need to stop the foreclosure for good. Learn what you can do to avoid or stop foreclosure. |