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» What will a loan cost?
» What is included in my loan payment?
» Will I have to pay any extra loan fees if I apply for a loan on the Lenders Direct Web site?
» What are the appraisal costs?
» What closing costs will I pay?
» What does rolling in these fees mean?
What will a loan cost?
Your monthly payments go partly to repay your loan and partly to pay the fees for your loan, many of them relating to the closing, or settlement.
The typical fees that cover the loan processing and closing are:
Lender Fees
- Origination fee
- Discount points
- Appraisal fee
- Credit report
- Inspection fee (newly constructed homes only)
- Processing fee
- Underwriting fee
- Document preparation/review fee
- Tax service fee
- Mortgage insurance
Title charges
- Attorney's fees
- Escrow fees
- Title insurance
- Transfer tax (excludes refinances)
- Recording tax
Miscellaneous charges
- Property survey
- Flood certification
- Termite inspection
Prepaid expenses
(not part of the actual cost of the loan, but listed on the Good Faith Estimate)
- Prepaid interest (interest that accrues between closing and the end of the closing month -- paid in advance)
- Pro-rated homeowner's insurance
- Pro-rated real estate taxes
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What is included in my loan payment?
At the least, your loan payment will consist of the principal and interest for one month. In some states, you may elect to have your insurance and taxes prorated and added onto the monthly cost. In other states, it may be required that you pay for insurance and taxes as part of your loan monthly payment. This money would be placed in an impound or escrow account by the lender.
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Will I have to pay any extra loan fees if I apply for a loan on the Lenders Direct Web site?
Lenders Direct fees are the same regardless of application method.
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What are the appraisal costs?
Appraisal costs vary by the property type and the area. Lenders Direct will place the appraisal order with a licensed appraiser in your local area. Like most small business persons, the appraiser expect to get paid at the time the property is inspected, and will not release the appraisal to the bank until your funds clear. Ask the appraiser when they call you to schedule the property inspection about the fee so you can be prepared in advance.
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What closing costs will I pay?
Lenders Direct offers loans with and without closing costs, depending upon what type of loan you want and the amount of money you are borrowing.
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What does rolling in these fees mean?
Lenders Direct gives you the option of rolling these funds into your loan amount. This allows you to get your loan with no out-of-pocket expense, but your loan amount will be slightly higher. One alternative is to provide these funds yourself when the loan closes. You'll be borrowing a smaller loan than with a roll-in, but you will incur immediate out-of-pocket expenses. Or you may be able to cover the closing costs by taking a slightly higher interest rate, this is called a No-Fees loan, and Lenders Direct offers several different programs with this feature.
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