When you buy a house, you will pay fees. You will have closing costs to pay that relate to the home purchase, but you will also have fees to pay for the mortgage loan. Mortgage lenders charge fees for their services, but do you know what fees they charge? If you want to save money, you might want to ask a few lenders for an estimate of their closing cost fee structures. By doing this, you can compare the fees they charge. Here is a list of some of the common fees you can expect to pay.
Some lenders might charge applicants a fee when they apply and submit their loan applications. An application fee tells the lender that the borrower is serious about getting a loan. After all, a person will not want to pay this fee if they have no intention of getting a mortgage. The amount you pay for this varies, but you can ask your lender to learn more before applying for the loan.
Credit Report Fee
Most lenders also charge a fee for checking your credit report. Your lender will need to run a credit check, as your credit is a major role in their decision. The amount varies for this fee, too, but a loan estimate will tell you how much you can expect to pay for it.
Loan Origination Fees
One of the costliest fees you will pay when getting a loan is called a loan origination fee. This fee is the income your lender earns from issuing you the loan. Your lender also earns money from interest, but they always charge an origination fee to cover all the costs of working on your loan for you.
Underwriting or Processing Fees
Finally, you might notice that the list also has a fee for underwriting or processing. Every loan goes to the underwriting department for processing, and this also costs money. As a result, your lender will charge a fee for this part of the loan process.
While these are the main fees you can expect to pay when getting a mortgage, you should not be surprised if there are also some other fees. Lenders might charge other fees for their services, but you will see all the fees if you ask for a mortgage loan fee estimate. You can talk to a mortgage lender to learn more about the fees and loan options.