When applying for a mortgage, or refinancing for that matter, make sure you don't forget to check the Good Faith Estimate (GFE) document! This is a document, standardized to be the same for all lenders, containing all of the costs associated with getting that loan. Items covered in that document are:
Origination fees, including:
- Discount
- Property appraisal
- Credit report
- Lender's inspection
- Mortgage insurance application
- Assumption
- Mortgage broker fee
- Tax-related service fee
- Application
- Commitment
- Rate lock
- Processing
- Underwriting
- Wire transfer
Closing costs or prepaids, including:
- Abstract or title search
- Title examination
- Document preparation
- Notary
- Attorney
- Title insurance
- Recording
- City/county tax stamps
- Transfer tax
- Survey
- Pest inspection
- Condominium application
- Prepaids for interest, hazard insurance, property taxes, mortgage insurance and flood insurance
You may find that one lender's interest rates are lower, but that same lender's origination fees are higher. One may consider this as basically prepaid interest, in a way. The same thing goes with some of the rest of these fees. Finding out the total cost of more than one lender's loan (by checking the GFE) and comparing them side-by-side is probably the best thing a consumer can do to get the most out of their mortgage dollar. Total length of time that a consumer plans on keeping the loan, among other things, will justify paying higher origination or closing costs in order to receive a lower monthly mortgage payment.
For any other Rochester, MN real estate needs or questions please visit my web site. There you can contact me, conduct your own home and property search, or just look around to possibly update yourself on the Olmsted and surrounding counties' real estate market. I appreciate your interest in Rochester MN real estate and look forward to helping with any questions you may have.
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