Stop Whining to Your Lender About the Reverse Mortgage Costs
Closing a reverse mortgage loan will cost a good bit of money, and place of residence will not affect this fact. This is an essential truth that must be realized.
The cost of closing is determined using the value of the home, which is figured by an appraiser. It is generally five percent but can go up to ten if the home value is very low.
In my line of work, I talk to borrowers all the time that are not aware of this fact. Sometimes my company even gets the rap for how rough the costs can be.
So, who do we blame when there is no one else to blame? Mostly people like to point their fingers at the mortgage company. Those greedy pigs.
The whole enchilada is comprised of as much as six or seven different companies. And I'm including the Federal government.
If you look at what is known as a Good Faith Estimate of Costs, you will notice a litany of fees. Only one of these fees is charged by the actual lender. It is known as an origination fee.
It's still a decent size fee, but it certainly doesn't take up the lion's share of costs.
Of all closing costs HUD charges the most of any company for homes valued between $100,000 and $417,000. They charge an insurance fee of two percent of value.
FHA can charge up to eight thousand, three hundred and forty bucks, while the bank charges as much as six thousand for origination.
This is newly legislated by the way. I think its funny that the government has no problem capping how much money the lender can make, but they don't cap how much they can charge.
(Incidentally, if you were called to give money to a campaign as of late and thought you were on the list of people not to call, the legislators happily exempted themselves from that law.)
Anyway, another big bite out of the costs comes from the escrow company. They have several fees, including a transaction fee, insurance for the title, and others.
Then don't forget the appraisal fee for a formal valuation. In some states you have to get the land surveyed as well. That aint cheap.
I couldn't talk about states other than Texas, but i imagine someone else is taking a piece as well. Just keep this in mind before you take it out on your loan officer's company.
The cost of closing is determined using the value of the home, which is figured by an appraiser. It is generally five percent but can go up to ten if the home value is very low.
In my line of work, I talk to borrowers all the time that are not aware of this fact. Sometimes my company even gets the rap for how rough the costs can be.
So, who do we blame when there is no one else to blame? Mostly people like to point their fingers at the mortgage company. Those greedy pigs.
The whole enchilada is comprised of as much as six or seven different companies. And I'm including the Federal government.
If you look at what is known as a Good Faith Estimate of Costs, you will notice a litany of fees. Only one of these fees is charged by the actual lender. It is known as an origination fee.
It's still a decent size fee, but it certainly doesn't take up the lion's share of costs.
Of all closing costs HUD charges the most of any company for homes valued between $100,000 and $417,000. They charge an insurance fee of two percent of value.
FHA can charge up to eight thousand, three hundred and forty bucks, while the bank charges as much as six thousand for origination.
This is newly legislated by the way. I think its funny that the government has no problem capping how much money the lender can make, but they don't cap how much they can charge.
(Incidentally, if you were called to give money to a campaign as of late and thought you were on the list of people not to call, the legislators happily exempted themselves from that law.)
Anyway, another big bite out of the costs comes from the escrow company. They have several fees, including a transaction fee, insurance for the title, and others.
Then don't forget the appraisal fee for a formal valuation. In some states you have to get the land surveyed as well. That aint cheap.
I couldn't talk about states other than Texas, but i imagine someone else is taking a piece as well. Just keep this in mind before you take it out on your loan officer's company.
About the Author:
In Texas do not get a reverse mortgage before acquiring this guide. And by the way.. Definitely get a tremendous fact sheet at this Texas reverse mortgage educational hub.
posted by Debt Consolidation Loan at
10:11 PM
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