Mortgage Loan Application Fees

Mortgage Loan Application Fees

 Since it typically takes some time to do this analysis and present you with the information, they do incur some costs to do the mortgage analysis.

If the company does a good job then they actually need to evaluate your application by factoring in at least the following:

• your credit score
• see if any credit issues are a problem or can be explained
• see if your income can be documented properly and is acceptable to a lender
• research what loan programs are appropriate for you
• match you up with potential lenders
• factor in the debt load you can carry on an ongoing basis
• compensating factors should also be considered as part of this evaluation

   
  Why You Shouldn't Pay Application Fees

  As you can see, evaluating a solid mortgage application is labor intensive. But if a company or an individual wants to earn your business you SHOULD NOT have to pay any application fees.  If they want to charge this, move on to someone else.

  At most you should reimburse them for the cost of the credit report they run (if they do this at all). Make sure you are reimbursing them for the credit report, not paying a markup. Most credit reports that lenders use don't cost over $40, and typically around $10-$20 for a credit report, depending on an individual or joint report . This week I heard someone being charged $60 for a credit report, and another individual being charged $85.

If you are being charged these fees, most likely you are dealing with a group that is having financial difficulties.

Taking an application and paying for the credit report is part of doing business. 

My question to the realtors, "Are you charging gas money to your clients for showing them houses all around town?"