Unravelling the Confusion of Closing Costs

Buyer, Seller

In comparing loans for your new Jacksonville home, keep the following in mind. Closing costs are split into two main categories: the closing costs controlled by the lender which vary from place to place and closing costs not controlled by the lender that will not be negotiated.

The Process

You will first obtain a "Good Faith Estimate" of closing costs when talking to a mortgage lender. It is your right to receive a copy although they may send it to you within three business days of your application.

Remember, the mortgage lender is not the only one charging all of your final closing costs, nor do they know what all the costs will actually be. They will normally give you a higher end estimate based on an educated guess from past experience, but obviously some things can be neglected. Plan on actual costs to change slightly than those which are listed on the estimate.

Non-recurring closing costs are items you pay for one time only, with recurring closing costs being those paid monthly or annually, such as taxes and insurance.

The Dangers

There are many ways a lender can charge you costs and be prepared for “bait and switch” routines. Good Faith Estimates are ONLY valid for the loan applied for, so when your loan type changes, so do your costs!

Unfortunately, unscrupulous companies will be waiting for their next victims to call, asking what closing costs their company charges to obtain a good faith estimate. Many will quote “closing costs” and fail to include ALL costs not associated with the lender, which when totaling required escrows, insurances and title fees can amount to thousands.

The Low-Down

The following shows summary of costs you may see when purchasing or refinancing your Jacksonville homes. Some items appearing may not show on your lender's Good Faith Estimate, and lenders are not required to show or charge all of these items. They are listed in the order they may appear on a Good Faith Estimate:

Closing Costs Associated with the Lender.

Loan Origination Fee

Loan Discount

Appraisal Fee

Credit Report

Lender's Inspection Fee

Mortgage Broker Fee

Tax Service Fee

Flood Certification Fee

Flood Monitoring

Document Preparation

Underwriting Fee

Administration Fee

Appraisal Review Fee

Wire Transfer Fee

Warehousing Fee

Closing Costs not associated with the Lender

Closing/Escrow/Settlement Fee

Title Insurance

Notary Fees

Recording Fees

Pest Inspection

Home Inspection

Home Warranty

Loan Tie-in Fee

Sub-escrow Fee

Courier Fee

Homeowner's Association Transfer Fee

closing costs (4) home buyer (6) finance (18) mortgage (22) home selling (7) listing price (15) home loan (7) buyer (35) seller (43)