Loan-Related Closing Costs

Loan Origination Fee
This covers the loan officers time and energy in putting the loan together. The loan origination fee may be a percentage of the mortgage amount.

Processing Fee

This is the fee to process the loan.  It is usually $300-$400, but can vary from company to company.

Underwriting Fee

This the fee charged to underwrite the home loan.  It is usually $200-$400, but can vary from company to company.

Administration Fee

This fee covers administration and processing costs.  It is usually $150-$250, but can vary from company to company.

Tax Service Fee

This fee covers the handling of your tax paperwork for the home loan.  It is usually $50-$75, but can vary from company to company.

Discount Points (optional)
An option for the home buyer is to pay points to lower the interest rate at which the loan will be repaid. Each point equals 1 percent of the mortgage amount. For example: on a $150,000 loan, 1 point would equal $1,500.

Appraisal Fee
The fee for having the house appraised may be incorporated into the closing costs or payment may be required by the lender at the time the loan application is submitted.

Credit Report
The lender uses a credit report to determine the creditworthiness of the loan applicant. This fee is often paid when the loan application is submitted.

Interest Payment
Typically the buyer is required to pay interest on the mortgage loan to cover the time between the closing date and when the first mortgage payment period begins. For example: If closing is on May 15. Your first monthly payment begins to accrue interest on June 1 with your first mortgage payment due July 1. At closing an interest payment covering the accrual period between May 15 and May 31 may be required.

Escrow Account
At closing a payment may be required to fund the escrow account if the lender is paying home insurance, property taxes and/or other expenses out of the escrow account.