There is a lot that goes into the approval, process and approval of your mortgage. Much of this is done behind the scenes, so when you are evaluating your closing costs there are typical fees that you can expect to see. Closing costs vary depending on your loan amount and can range from $3000-$5000 for most loan programs. Certain loan programs require different closing costs so ask your loan officer if you are uncertain!
Most common closing costs include:
- Bank Fees/Origination Charge: included in this fee is underwriting fees, processing fees, tax service fees, IRS verification fees, warehouse fees and MERS fees
- Appraisal Fee: This fee is to pay an independent appraiser to perform an opinion of value on your home. It serves to protect both you and the lender and ensure that the home’s value is not less than you are paying for it.
- Credit Report Fee: a large part of the underwriting process involves credit. Beginning from verifying your FICO score to updating any accounts as needed throughout the process.
- Flood Certificate: Your lender will need to verify that your home is or is not in a flood zone. If in a flood zone, it’s likely that flood insurance will be required by your lender.
- Attorneys Fees: Your closing attorney will be doing an incredible amount of work for the closing process. Starting from your title exam, to your municipal lien certificate, to providing title insurance for your home.
- Recording Fees: At settlement, you will record a mortgage and a deed to evidence that you own the home. This is when your ownership becomes officially a matter of record.
- Plot Plan: The attorney will obtain a copy of a plot plan to evidence that the boundaries of your property are approximately where they should be. This is not exact, but gives a rough idea. Should anything look out of the ordinary then you would be able to obtain a survey to verify your lot lines.
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