Discount Points

802

Loan Discount Points
Often referred to as "points", this is a one-time charge from the lender that you pay to buy down the interest rate on your loan. Generally, the higher the charge, the lower the interest rate, and vice versa. If the points have a negative value it means that they will be credited back to you at closing. Each point equals 1% of the loan amount.

Lender Fees

801

Loan Origination Fee
By eliminating commissions and streamlining the loan process, Unlike many offline brokers or online lenders, INLOAN never charges you an Origination Fee. This fee is charged by brokers and lenders and is the main way they are paid for their service. This is one of the places where INLOAN saves you a significant amount of money.

809

Underwriting Fee
This fee covers the cost of reviewing your loan application, is lender-specific, and usually costs between $100 and $600. Underwriting is the name of the analysis a lender performs to determine if they are willing to lend you money and under what conditions.

810

Mortgage Broker Fee
This is a fee paid by the lender to the Broker in exchange for services rendered to the borrower. INLOAN incurs this fee, and does not roll this cost up into their other fees.

812

Commitment Fee
Any fee paid by a potential borrower to a potential lender for the lender's promise to loan money at a specified date in the future. The lender may or may not expect to fund the commitment.

818

Processing Fee
A processing fee is often charged to cover the cost of processing the loan. By not charging a processing fee INLOAN saves you hundreds of dollars and simplifies the closing process.

819

Courier Fee
Other lenders will often charge for the costs of sending documents to various parties using couriers or express mail services. These costs are generally based on actual usage and will generally be higher when the process is rushed, but some lenders may use a fixed charge. These fees generally run $25 to $50.

820

Wire Transfer Fee
When your loan funds, it is a common practice for a lender to wire the funds to the settlement provider (escrow holder, title company, or attorney). This is a fast and efficient way to transfer funds in a transaction where time is crucial. The receiving account charges a nominal fee for the wire transfer of $10 to $50.

821

Document Preparation Fee
This charge covers the cost of drafting the loan documents and is typically $75 to $350.

830

Administrative Fee
This is a fee charged by other lenders to cover some of their expenses. Some lenders charge this fee, while others roll this cost up into their other fees. It can range from zero to $700.

1301-1312

Additional Settlement Charges
Fees not covered by one of the other HUD numbers can be included as a 1300 series

N/A

Homeowner's Association Certification Letter This fee covers the cost of getting a letter from a condominium's homeowner's association that provides background information on the property. For example, they will notify the lender whether they are involved in any litigation, the number of units that are owner-occupied, the number of units that are past due on fees, etc. We have estimated this cost at $125, but the fee will be set by the homeowner's association. This fee will generally only apply for purchases of a condominium, but there may be exceptions. There is no predefined line item number used for this charge, therefore, it will appear under different numbers for different loans.

Third Party Fees

803

Appraisal Fee
The appraisal fee covers the cost of a professional appraiser evaluating your home to estimate its fair market value. The appraisal is used to calculate the loan amount as a percent of the property value. This loan-to-value (LTV) ratio is one of the factors that dictates whether a lender is willing to approve the mortgage application and whether additional fees may be required (e.g., mortgage insurance). The cost of the appraisal will depend on the location of your property (rural vs. urban), the complexity of the appraisal and the going rates for appraisers in that area.

804

Credit Report
This fee covers the cost of a credit report that will be used by the lender to review your credit history and help determine whether to approve your application. Although the fee is collected by INLOAN, that payment goes to the credit service agency. Because lenders require an independent credit report, we cannot reuse any prior credit reports you may have. The cost of a credit report is $49 per report. One report is required per borrower, unless the borrowers are married to each other in which case a combined report can be used for a single $49 fee.

808

Tax Service Fee
The lender needs to know that the property taxes are being paid in full and on time because a tax lien would take priority over their lien as a lender. This fee covers the cost of a tax service agency hired to monitor your account. If your taxes are impounded, the agency provides the lender with your tax bills so that the lender can pay your taxes on time. If you pay the taxes yourself, the agency monitors the tax rolls for the life of the loan, and informs the lender if they ever become delinquent so that they can take action to protect their lien position. This one-time fee is set by the lender, and generally runs between $50 and $120.

822

Flood Certification
Lenders want to ensure your property (their collateral) is well protected from likely hazards. In addition to requiring hazard insurance to cover events like a fire, they want to know if floods are a concern in your area. This fee covers the cost of a report to determine if the property is in a flood- risk area. The Federal Emergency Management Agency (FEMA) designates flood zones to indicate that certain areas have a high risk of flood damage. If your home is located in one of these flood zones, you will be required to secure flood insurance. Most homeowner's policies do not cover flood damage, so a separate policy will be required.

1301-1312

Addition Settlement Charges
Fees not covered by one of the other HUD numbers can be included as a 1300 series

Title Company or Attorney Fees

1101

Settlement or Closing Fee
This fee pays for the services of the escrow or settlement agent that handles all the financial transfers and payments associated with the transaction.

1102

Mortgage Description
Search Fee
This fee covers the cost of searching the Registry of Deeds to determine if there are any other liens on your property. Often this fee is included in the title insurance fees. The fee varies widely, but is usually a few hundred dollars.


Home Equity Description
Recordation Service Fee
This fee covers the cost of processing the deed recordation. The service includes the assurance that the lien is recorded, all borrowers are vested and/or have the right to permit a lien to be recorded against the property and associated courier services.

1103

Title Examination Fee
This fee pays for a search of all liens secured against your property to ensure that your claim to the property is unencumbered.

1106

Notary Fee
This fee covers the cost of hiring a licensed notary public to certify that the individuals signing documents are who they claim.

1107

Attorney Fee
In some states an attorney performs the functions of an escrow agent, in which case this fee is in place of the Settlement or Closing Fee described above. This fee could vary widely by area of the country and by the individual attorney you select. Please consult with your local real estate agent to understand if an attorney is customary and to get an estimate of the associated fees.

1109

Title Insurance: Lender's Coverage
Title insurance insures against the possibility that there is an unknown lien on your property and ensures your undisputed ownership. The title company will check that no other entity has a lien, unpaid claim or other restriction on your ownership of the property and protects the lender in case a lien does exist that the search did not uncover.

1110

Title Insurance: Owner's Coverage
Owner's coverage also guarantees that your home has no other liens. The difference is that it protects the owner and insures you for the entire value of the property (not just the loan amount). The premiums depend on the property value and range from 0.3% to 0.6%. On purchase transactions, in most states, this coverage is optional and is frequently paid for by the seller. Please contact the Title Company you are using for this transaction to obtain a quote, should you decide to purchase this coverage. Your Loan Consultant can also help you obtain this information. The owner's policy is not necessary in a refinance situation as that policy remains in full force and effect for as long as the owner owns the property.

1111

Delivery/Courier Service
This fee is similar to the courier fee charged by other lenders, but covers the title company's or attorney's delivery costs. The fee is approximately $30.

1112

Wiring
When your loan funds, it is a common practice for a lender to wire the funds to the settlement provider (escrow holder, title company, or attorney). This is a fast and efficient way to transfer funds in a transaction where time is crucial. The receiving account charges a nominal fee for the wire transfer of $10 to $50.

1113

Environmental Endorsement Fee
Endorsements are used to change the coverage of the title insurance policy. This fee insures the insured against loss or damage sustained by reason of lack of priority of the lien of the insured mortgage over any environmental protection lien.

1114

Title Endorsement Fee
Endorsements are used to change the coverage of the title insurance policy. ALTA policies and other forms of title insurance policies provide adequate coverage for a majority of the "simple" real property transactions. If the transfer of title is not "simple," the policy coverage needs to be added by endorsement to tailor coverage to meet the home owner's, the seller's, and/or the lender's needs.

Government Fees

1201

Recording Fee
Once your transaction closes, your mortgage or deed of trust is recorded at the county recorder's office to make your transaction a matter of public record. The recording fee varies by the county being paid.

1202

County Tax Stamps
Stamps tax on the sale of real property, based on the sale price of equity transferred.

1203

State Mortgage Tax
This is a tax charged by some states as an additional means of collecting tax revenue and ranges from 3/4% to 1-3/4% depending on the jurisdiction. The current states charging a mortgage tax include Alabama, Florida, Georgia, Hawaii, Kansas, Maryland, Minnesota, New York, Oklahoma, Tennessee and Virginia.

1204

City Tax Stamps
Stamps tax on the sale of real property, based on the sale price of equity transferred.

1205

Intangible Taxes
Intangible tax is an ad valorem tax on the current market value of intangible personal property owned, managed, or controlled by persons residing or doing business in any state which levies this tax. Unlike federal income tax, intangible tax applies to the calendar year in which it is paid.

Lender Pre-Paid Items

901

Interest
Lenders require that you pay the interest due on the new loan from the date of funding to the time of the first monthly payment (usually the first day of the next month). The interest due is calculated using the loan's interest rate and the appropriate number of days. We have conservatively assumed a full 30 days of interest, but on average borrowers pay 15 days of interest.

902

Mortgage Insurance
Private mortgage insurance (PMI) is required by lenders when your loan-to-value ratio (loan amount divided by property value) is greater than 0.8 or 80%. This insurance protects the lender in case the value of your property decreases to the point where it is worth less than your loan balance. The lender typically requires that the borrower prepay two months premium. We have estimated your premiums using industry standard rates for the type of product you selected and your loan-to-value ratio.

903

Hazard Insurance Premium
INLOAN will require that you insure the property you are buying, since the property is collateral for the loan. At the time of closing you must pay the entire first year's premium or prove that you already have sufficient coverage (i.e., in the case of refinancing). If you are purchasing a condominium, your association policy will already cover your unit and you will not need to make this payment though proof of coverage is still required. The cost of hazard or homeowners' insurance depends on many factors, including location, property value, types of coverage and deductibles. We have used an estimate based on actual costs of funded loans by state. It is calculated as a percentage of the property value, but we recommend you consult with an insurance company for a more accurate quote.

N/A

Impound or Escrow Account Deposits
An impound (or escrow) account is an account used when the lender will be paying your homeowner's insurance and property taxes on your behalf. You prepay the amounts due into the account and the lender pays the costs as they come due. The amounts normally required to be prepaid at the time of closing are: (1) two months of homeowner's insurance, and (2) the amount the lender will need to pay the property tax installment due plus a two month reserve to make additional tax payments as needed.

If private mortgage insurance (PMI) is required on your loan, you will always be required to prepay those premiums (usually two months worth). In addition, typically 1/12 of the annual premiums or installments is collected with your monthly payment on an on-going basis.

Impound accounts are required by lenders in most states, particularly when the amount your loan-to-value ratio (loan amount divided by property value) is greater than 0.8 or 80% (75% for refinancing with cash out). When an impound account is required by the lender, you can often waive the use of an impound account for the homeowner's insurance and property taxes for a fee. However, you will always have to prepay your PMI (if any) into an impound account.

1001

Hazard Insurance Impound
This impound represents the amount the lender withholds to ensure you pay your hazard insurance on time. Typically, the lender will impound two months of premiums at closing, and then collects 1/12th of the annual premium with each monthly payment. We have used a standard industry estimate of 0.35% of the property value to calculate the premiums, but the actual amount will be established by your insurance company.

1002

Mortgage Insurance Impound
This impound represents an estimated one month mortgage insurance premium. It will be calculated using your actual premium rate as set by the lender. A monthly premium amount will be collected with every monthly payment thereafter.

1004

Property Tax Impound
The amount of property tax impounded can vary dramatically by county and the date you purchase your home. For example, in some counties the amount withheld equals the county tax rate times the number of months from the time you close until your first tax payment is due. You can get a rough idea of the amount due by using your county tax rate and an average of 6 months, but we recommend you consult directly with your real estate agent or county authorities for a more dependable figure.

Credits from INLOAN

200

Credits from INLOAN
These line items are used to show any credits you are receiving from INLOAN that will be applied against your closing costs. Any credits will be applied at the time of closing.