A few days after completing your loan application, you will receive a Mortgage Loan Disclosure Statement and a Truth-In-Lending form.   Until the escrow officer has finalized your costs, these are estimates only, but they will give you a good idea of the total amount required to close your transaction.

Origination Fees. Often called "points" or "loan discount", points are a one-time charge used to adjust the yield on the loan to what market conditions demand. For example, if you want a 30 year fixed rate at 0 points, the rate might be 6.5%, but if you pay 1 point, the rate would drop down to 6.25%. One point is equal to 1% of the loan amount. This is literally the price charged for a particular loan. Points are a form of prepaid interest, and are fully tax deductible in the year paid.  

Processing Fee. A one-time processing fee of $499 charged by Guarantee Mortgage covers the administrative cost to process your loan. The fee covers:

- Setting up your loan file
- Preparing federal disclosures 
- Verifying your bank accounts, rental and credit history
- Underwriting your loan
- Preparing the 1003 and 1008 forms
- Obtaining condominium documents and a certification form
- Preparing submission and document request forms to the lender
- Ordering and obtaining loan and funding conditions
- Overnight courier services to the lender
- Duplication and collating services

Appraisal Fee. This is a one-time fee for an appraisal -- a statement of property value -- for the lender. We hire an independent appraiser to inspect the property, search comparable sales, and prepare a comprehensive property report. The fees start at $350 for a single family home.

Credit Report Fee. This fee ranges between $16 and $25 depending on the services ordered.  

Escrow Fee.  This is a one-time fee charged by the title company to administer your escrow.  This includes a title search, title report, the coordination of buyers and sellers funds, paying off loans on the property, making sure you take clear title to the property, and making various payments to third parties such as appraisers.

Title Insurance Fees. There are two title policies that you will be purchasing -- a lender's title policy -- ALTA -- which protects the lender against loss due to defects on title, and a buyer's title policy -- CLTA -- which protects you from title defects as long as you own the home.  These are both one-time fees, although, if you refinance in the future, you will need to purchase a new lender’s policy.

Miscellaneous Title Charges. The title company may charge fees for recording the deed of trust, document preparation, notary, email receipt of loan documents.  These are all one-time charges and are fairly minimal.

Lender Underwriting Fee. Depending on the lender, these fees generally range from $450 to $695, and include processing and underwriting your file, reviewing the appraisal and credit report and other documentation and preparing your loan documents.  Lenders will typically re-verify your credit and employment status immediately before closing.  

Prepaid Interest. Depending on the date your transaction closes, this charge varies.  If your loan closes at the beginning of the month, you will probably have to pay the maximum amount of prepaid interest. If your loan closes at the end of the month, you will only have to pay a few days' interest. Either way, this is a tax deductible item.

Taxes and Hazard (Fire) Insurance. Depending on when you close, you may be required to reimburse the seller for property taxes already paid. In addition, you will also need to pay an entire year's fire insurance premium up front. Any property taxes you pay in escrow are tax deductible.