Whether it's your first time buying a house or you're refinancing your existing home mortgage, there are closing costs that can sometimes catch you off guard if you're not prepared for them. Listed below are some typical items that may incur additional fees as part of your loan transaction.
- Appraisal Fee
This is a one-time fee that pays for an appraisal of your property conducted by an independent appraiser. You will receive a copy of your home's appraisal.
- Credit Report Fee
A fee that covers the cost of purchasing your credit report.
- Document Preparation Fee
There may be a separate fee that covers the preparation of the loan papers.
- Loan Discount
This is the “points” a lender charges. The number of points can fluctuate depending on the current market conditions.
- Miscellaneous Title Charges
The title company will charge fees for a title search, title examination, document preparation, recording fees, a settlement or closing fee, and notary fees.
- PMI Premium
You may be required to pay an up front fee for private mortgage insurance (PMI), depending on the amount of your down payment. If you have a high loan to value loan, a lender may also require monies be placed into a reserve account held by them.
- Prepaid Interest
You'll need to pay for your first month's interest on the loan at closing. Depending on the time of month your loan closes, this charge may vary from a full month's interest to just a few days. If your loan closes at the end of the month, you will have to pay interest only for a day or so.
- Taxes and Homeowners Insurance
You may be required to deposit a certain amount of funds into a special reserve account to cover taxes and insurance. This reserve account is held by the lender.
Part of the TruDifference is making sure you have all the information you need to make the right decision. That's why when you apply for a loan with TruWest, we will give you a Good Faith Estimate of closing cost and settlement charges, as well as a pamphlet that explains your loan costs.
For more information, please call (AZ) 480.441.5900 or (TX) 512.996.4000.