Our NJ Mortgage Company Offers Closing Costs for NYC Residents
What fees to expect when closing on your home loan
Closing costs are an integral part of the home buying process. Closing costs are, quite simply, the total fees associated with buying a house. Some of the fees are assigned to the buyer and others to the seller. They vary depending on many factors including home price, commission and location. It’s important to understand what you’re obligated to pay, and we will, of course, supply you with a detailed analysis of your fees in a Good Faith Estimate and Truth in Lending forms.
As part of our deep commitment to customer satisfaction, a home loan expert will work with you throughout the entire process; so you’ll always get a straight answer and assistance when and where you need it. We believe in making the entire home buying process as smooth and headache-free as possible. It’s part of the reason our reputation has remained so strong since 1938.
The Truth in Lending form you receive from us, will provide an estimate of your loan costs, including your total finance charge and Annual Percentage Rate (APR )— the cost of your loan as a yearly rate. The fees listed below cover most of the costs included in the Truth in Lending document.
- Origination fee: Covers the lender's work involved with evaluating and preparing your mortgage loan. Discount points are an optional fee you can pay to “buy” a lower interest rate— the more points paid, the lower the rate.
- Appraisal fee: Pays for an independent appraisal of the home you want to purchase. The lender requires this opinion or estimate of the market value of the house for the loan.
- Credit report: Provides a credit score number, or FICO score, that distills all of the information in your credit report and indicates your credit worthiness.
- Underwriting and document fees: Covers the lenders loan underwriting processing and creation of detailed documentation that must comply with strict US and state laws.
- Tax service fee: This is a one-time fee paid during closing to ensure that your property taxes are paid during the term of your home loan.
- Processing fee: Covers the set-up of your file: all internal work and procurement of all documentation required to make your loan viable. It also covers the follow-up required to ensure that your loan funds at the proper amount, fees and closing date.
- Title and escrow fees: Fees may vary by jurisdiction and often include the cost of title insurance or title search and attorney's title opinion. They may also cover premiums for the lender's policy and a separate policy insuring the buyer's title.
- Title Insurance: This ensures that the title of your property is delivered to you free and clear of any liens. Title Insurance covers any claims made on your property prior to closing that are related to the title of your home
- Transfer Tax: These are state and local taxes that are assessed when ownership of the property is transferred between parties. Documentary stamps are purchased covering such charges and are placed on the deed.
- Property survey (purchase transactions): A surveyor determines whether the house is within the property borders, if there are any encroachments by neighbors, and/or any easements on the property that may affect legal title.
- Termite inspection (typically associated with a purchase): This is professional inspection done by a certified pest control specialist to ensure that your property does not have any termite damage or evidence of termites.
- Prepaid Interest: The interest on your loan calculated on a per day basis and paid in advance from the day of your loan closing through the last day of the month in which your closing takes place.
- Insurance: Homeowners & Hazard: Required at closing, this insurance protects against physical damage to the house by fire, wind, vandalism and other causes.