When applying for a home loan is it typical to pay about $1000 in fees, and would you pay a lender up front?

Answer 1

Your fees will depend on the amount of the loan.

The only fee to be paid upfront would be your appraisal that you can pay straight to the appraiser.

Watch out for other Junk Fees.

Answer 2

No. That's not typical at all. You should be paying much more than $1,000 in fees unless the seller is contributing towards your closing costs.

Learn all about the mortgage process before you go any further at: http://explaintome.blogspot.com...

No you should not pay the lender up front. You should walk away from any lender that wants cash to ensure he does the loan for you. Application fees are OUT. Only shady brokers are charging them.

The appraisal fee is different. The appraisal is covered one of two ways:

1. The appraisal fee will be included in the final closing costs at the closing. The bank has pre-paid for the appraisal and there's a good chance that you'll never see it.

2. You pay the appraiser directly for the work completed. The appraisal is yours so you can keep it for your records or use it down the road to refinance.

The good faith estimate will break down all the fees. Just realize that there are different parties that are getting paid with your fees:

mortgage broker - if you use one
lender
appraiser - we covered that earlier
title company or attorney
government fees
prepaid fees collected on your behalf for future payments of interest, insurance, and taxes

So, I'd be absolutely suprised to find that your fees only totalled $1,000 without seller's assistance. However, if the question is "Should I pay the lender $1,000 up front?", then I suggest you run away fast. There are plenty of mortgage brokers and banks that value your business more than this guy. He's trying to lock you up so you can't walk away after he treats you like garbage.

Best of luck!

Answer 3

You should definitely not have to pay the lender up front fees of $1000, as I have never heard of such a thing. However you may have to pay what is called an application fee (approx. $100-$200) if you go through a bank.

As you may or may not be aware, there are 2 ways to get home loans. Either through the retail side with a bank, or through the wholesale side with a mortgage broker. There are pros and cons to each, and you should definitely shop the market for the best rate. A mortgage brokerage will usually have the better rate because they are on the wholesale side of things. They will also be able to provide better options to those with not so great credit. However, the closing costs for brokers is usually substantially higher than that of traditional banks.

Here is an example. You walk into Chase Bank and they give you a 6.5% rate on a $150,000 home loan with $500 in closing costs. That seems pretty fair, but you could go to a broker and get a 6% rate with like $5000 closing costs. The closing costs are usually 'rolled' into the loan which would mean the loan at Chase would be $150,500 at 6.5% for 30 years and the loan with the broker would be $155,000 at 6% for 30 years. Your payment with the broker per month would be about $929 and with the bank would be about $951. This is just a sample, and I suggest you check on both sides to get the most competitive pricing.

Answer 4

Applying for a loan shouldn't cost anything (maybe $30 app fee, but that's it). If a lender wants $1k up front, they are crooked...but most lenders ARE to one degree or another. However, there are a number of fees associated w/ the actual purchase that you may have to pay b/t when you get approved for the laon & when you actually close on the house.

Answer 5

FIRST TIME HOME BUYER INFORMATION

Cost associated with your loan. You will need to pay for the appraisal up front (when it being done). You will need to pay for The Home Owners Insurance Coverage for 1 YEAR . The seller can help you with up to 6 percent of closing cost. So the title fee, lender fees, underwriting fees, broker fee, processing fee, flood cert, etc can be paid for by the seller.

So the 1,000 that you are paying is typical, unless the seller helps you with up to the 6 percent that he/she can do. In that case they can pay for it.

Did you get your GFE (Good Faith Estimate yet?) That will tell you all the fees associated with your loan.

Appraisal and Home Owners insurance is on the GFE as fees - do you see it listed on your GFE?

AND the appraisal is paid at the door, when the appraisal is being done.....not to the lender, etc. The appraiser likes to know he is getting paid, for the job he is performing. He/she will be in contact with you to sit up and appointment, and to make payment arrangements. This is just a FYI for you.

Go to this site: http://www.hud.gov
U.S. Department of Housing and Urban Development
451 7th Street S.W., Washington, DC 20410
Telephone: [phone] TTY: [phone]

This web site will tell you the RESPA laws, all all you need to know about the loan process. Being well informed helps you the client out. There will be all kinds of advise given to you.

http://en.wikipedia.org/wiki/Good_faith_estimate

Good luck to you.

Answer 6

The fees will vary according to the loan amount. THe only fee that should ever be paid upfront is insurance (paid to insurance company) and possibly an applicaiton fee (which is typically used for an appraisal). Make the check to the company never the individual and never blank. If they say, it is for appraisal but they dont know who it will be so leave it blank say NO. I will pay the appraiser at the door, or when you have his name give it to me. Then double check he is an appraiser.
1000 is one point on 100,000 loan, that is fair.

Answer 7

1k in fees sounds reasonable, but never ever pay a lender up front.

Answer 8

No, No and no. That is way too expensive. You should shop around for cheaper fee'd loans. I would think half that would be about right if not a little on the expensive side. Check out some sites and see what is on offer.

Answer 9

Pay a fee up front is like betting that they will do there job, do not do it.