When you are looking for a mortgage its always a good practice to shop a couple lenders. Just like any other business banks are in business to make money. You would be surprised what some lenders will try to get away with in fees to make extra money. Typically the two fees that are really negotiable are the rates and the origination fee.
A loan officer can make anywhere between 1% to 5% on the loan amount. These fees will include origination and yield spread on the rate that is being offered. Yields spread is commission that is paid by the funder for the rate being sold to the consumer. Typically a good deal is paying no more than 1% on the rate to the banker.
Here are the typical lender fees….. Keep in mind the processing and admin fee are negotiable as well.
1. Admin or undwriting fee usually between $500 – $900
2. Processing free usually between $100 – $600
3. Credit Report fee $20
4. Appraisal free $400
5. Tax Cert $19.00
6. Flood Cert $19.00
After talking to a couple of lenders make sure you get a initials fee worksheet that itemizes the fees and also get the(TIL) Truth-in-Lending statement. The TIL will disclose APR which will determine your true total cost of fees involved with the loan.
Another suggestion is to stay away from big banks. They typically have more red tape to get loans done, and high turnover……..