closing costs can vary depending on the type of loan, the
loan amount, credit scores, loan to value, and the lender.
For example, as your loan amount increases, certain closing costs
such as, title insurance, escrow fees, or origination fees,
because they are based on the amount of the loan. Also, credit scores determine rates
and points, as
they are interchangeable.
closing costs are costs that are ongoing, such as hazard
insurance, mortgage insurance, or property taxes. These types of
expenses are not associated with the lender, but may be collected by the
lender to pay others.
A home equity loan or second mortgage does
not require an impound account, and mortgage insurance is not
required regardless of the loan to value. On a refinance loan, the lender may collect a pre-paid amount to establish an
impound account for taxes and insurance.
Another item in this
category is pre-paid interest, which is prorated based
on the day of the month for closing, because your mortgage payment
pays the interest from the previous month.
closing costs are fees paid one time only to the lender or third
parties involved in the loan transaction, which can include the
following: loan processing, underwriting, loan documents, credit
report, appraisal, tax service, flood certification, courier,
loan origination, or points.
Lenders are required to
provide you with an estimated closing statement for your loan, which can
even be requested before starting the loan process. When
comparing mortgage quotes, the points, if there are any, should be quoted
separately from the other costs to simplify your