March 31st, 2017

MORTGAGE LOAN CLOSING COSTS EXPLAINED: If you shopped closing costs from a variety of firms, the total costs should really not differ that much from one firm to another, perhaps +/- $300. If there is more of a difference than this something is amiss. Since the Dodd Frank Act in 2011 basic categories have been established to follow for closing costs. There are also only 2 ways to do a mortgage loan now: 1) Borrower paid (Borrower pays the Broker and fees can be negotiated, and optional fees MAY be added such as processing and loan application fees), and 2) Lender paid (Lender pays the Broker and NO optional fees are allowed). Lets use Lender paid as an example here. The basic fees categories are: A) Lender fees which include any discount points, underwriting fee (what the lender charges to underwrite the loan-may vary +/- $100 per Lender, appraisal fee-may vary +/$50 per lender, credit report fee- may vary +/- $20, flood certification-may vary +/- $10; B) Settlement Company fees which include overnight fees,title search,title binder,lender title insurance, and optional owner's title insurance-all total may vary +/- $100 per firm; C) Local & State fees which include recording costs,local and state transfer taxes- same cost for all; D) Prepaid fees which include the interest from date of close to end of the month, first year homeowner's insurance, and several months of ins. and tax to set up the escrow account-same cost for all firms. Therefore when all the costs are totaled, all quoting should be very similiar. And as stated earlier, if the loan is the Borrower paid option  then the differences in costs can be far greater due to what the Broker may charge. The best recommendation is to SHOP for the best fees thruout.For great loan education, terrific service, and exceptional rates call DIVERSIFIED MORTGAGE BROKERS, serving Central Va. for 30 years-Tel: 434-237-3143. Email:, Web:

Diversified Mortgage Brokers

100 Copley Place, Suite D, Lynchburg, Virginia 24502
Toll Free: 800-388-3561 | Phone: 434-237-3143 | Fax: 434-239-4852
Email: | NMLS ID# 188675 (

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