Loan Origination Fee
This covers the administrative expenses in setting-up and processing the loan. The loan origination fee may be a percentage of the mortgage amount.
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. We can help you determine whether it makes sense for you to pay points to lower your rate or not. That will depend in part on how long you plan on staying in your home and what other opportunities you may have to utilize your available cash.
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.
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. Marimark Mortgage does not charge a credit report fee.
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.
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.
We will gladly provide you with an estimate of closing costs on a “good faith estimate” and help you to evaluate other proposals you may receive. There are often vast differences in how these closing costs are presented on a good faith estimate, which may make it difficult to compare your options.
Also, remember that rates and closing costs must be looked at together. A low rate may carry higher than necessary closing costs. On the other hand, your rate may appear to be higher than quoted by another lender, but may have significantly lower closing costs. We will discuss with you your goals and help you find the right balance of fees and rate.
Be careful of companies that offer “no closing cost” loans. Typically these loans carry a higher interest rate which allows the lender to pay the closing costs on your behalf. In effect, you are paying for the closing costs with a higher rate.
If you are purchasing a home, talk to your real estate agent about negotiating closing costs to be paid by the seller of the property. Most loan programs allow seller paid closing costs. This can help a buyer who does not have enough cash on hand for a down payment plus closing costs.
At Marimark Mortgage, our fees are straightforward and simple, and will not vary significantly from your final costs at the time of closing. We will also provide you with a draft of the HUD statement that you will receive at closing well in advance of closing so that you have the opportunity to ask questions prior to signing your closing documents.