When you obtain a mortgage for a home purchase, you will be faced with a range of expenses associated with the mortgage. These are typically called closing costs, but there are different types of fees that fall into that classification. This blog provides details on lender closing charges in Massachusetts.
Lender Closing Charges
Points
Points are a way for borrowers to secure a lower interest rate. It involves paying up-front interest to ensure lower monthly payments for the term of the mortgage. This option can be useful for buyers who need a lower payment in order to qualify.
Origination Charge
Origination fees vary from lender to lender. It typically covers a lender’s cost to complete the loan for a Massachusetts buyer.
Appraisal Fee
An appraisal is required by a mortgage company but generated by a third party. Appraisals confirm the value of the real estate and its condition. A loan will not obtain final approval until an appraisal is received, reviewed, and approved.
Tax Service Fee
Massachusetts real estate taxes may be included in your recurring mortgage payment. The lender collects the funds from you each month and places it into an escrow account. When the tax is due, the necessary amount is withdrawn from that escrow account. Many mortgage companies will require a up-front fee to set up this tax service.
Flood Certificate
Massachusetts real estate situated within a flood zone will require flood insurance. Lenders order a flood certificate to make that determination. Flood certificates are always charged to the home owner.
Credit Report
Credit reports are another typical lender closing charges. Credit reports are how they evaluate credit standing and applicable mortgage rates. There is a expense associated with pulling credit reports from the 3 major credit bureaus. Mortgage companies will frequently pass on this charge to the borrower.
Additional Lender Closing Charges
The lender closing charges discussed above are merely a few of the actual fees that may be billed by your lender. Here at Emery Federal Credit Union, I can offer my clients true no closing costs loans. For a complete list of potential fees that you may be responsible for when purchasing Massachusetts real estate, or for assistance with other real estate or mortgage topics, contact Christopher Graves at Emery Federal Credit Union by calling 781-759-1200 x22 or emailing christopher.d.graves@gmail.com.
