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What Mortgage Loan Closing Costs Will I Have to Pay?

By Francine L. Huff
Mortgage Credit Problems Columnist

When choosing a debt consolidation mortgage loan, know what closing costs you'll have to pay. Look at each lender's charges in addition to the rate. The charges are listed on a Good Faith Estimate and the Annual Percentage Rate (which includes the rate and charges) is disclosed on a Truth-in-Lending form.

Lender Closing Costs

Although your lender will prepare the estimate of closing costs, not all of those fees are charged by the lender. Fees the lender controls include:

• Appraisal fees to determine the value of the home.
• Flood certification fee determines whether or not you live in a flood zone.
• Mortgage broker fee if you obtain a debt consolidation mortgage loan through one of these services.
• Loan origination fees or points. A point is equal to 1% of the loan, and usually the more points you pay, the lower your interest rate.

Other Closing Costs

Be prepared to pay closing costs that have nothing to do with your lender. These are generally costs associated with financing or homeownership and have to be paid regardless of what lender you use. They include:

• Title insurance that makes sure the homeowner has clear title to their home.
• Property taxes, homeowner's association dues, and homeowners' insurance may be required to be prepaid into an escrow account.
• Settlement and escrow fees that can vary depending upon where you live since the procedure for closing a real estate transaction isn't the same in every state.

If you're refinancing your mortgage with a debt consolidation loan, you may have to pay some outstanding interest on the old loan. You also may have to pay a demand fee that the lender may charge to calculate your loan payoff. Keep in mind that the Good Faith Estimate that you receive isn't written in stone and that your actual costs may differ.

Source
RealEstateABC "Closing Costs When Buying or Refinancing a Home".

About the Author
Francine L. Huff is a freelance journalist and the author of The 25-Day Money Makeover for Women. She has appeared on a variety of TV and radio shows.

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