Junk fees on a home loan. What an ambiguous term. So many fees are mistakenly classified as home loan junk fees including fees that are bona fide. Mortgage loan fees nationwide amount to roughly 110 billion annually. You may wonder why that figure is so high to do a home loan.
With each loan that funds there are multiple people working to complete the loan transaction whether the loan is from a bank or a broker. Here is a list of the titles of people who are always involved in each and every home loan:
* a loan processor
* loan officer assistant
* escrow officer
* title insurance company
* appraiser
* appraisal management company
* underwriter
* underwriting assistant
* lenders account executive
* funder
* doc drawer
* county recorder
* courier
It amazes me how many banks provide good faith estimates without listing all of the fees associated with a home loan. Little does the consumer know that they make money to cover these fees by giving out higher interest rates. That higher rate can amount to more money spent on a loan than if the borrower would have paid the fees themselves.
If you hear your neighbor brag about how they got a no fee loan remember this: A sucker is born every minute in this country and nobody works for free.
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Nevin...without education people do get taken advantage of.
Larry - So true. Reading and comprehending is a must in any business transaction!
This is great! You're going video on us! Which is why it "pays" to have professionals who are overseeing the transaction for you. A good real estate agent can review the HUD-1 prior to signing if a client wants them to. And a good loan officer won't put these things on there in the first place!
Nicely done my friend! Great job creating this video too!
Carla - I think all but a few of these types of loan officers are out of the business or will be very soon. I just think the term junk fee is misused all of the time.
Thanks for including your recent posts in my outside blog!! LOVE the "funk" music in the video! Funk rhymes with junk.
It's gonna be a long week :wink:
Renee - Likewise! Awww, sorry to hear that. : ( Hope it turns out okay
Excellent, Nevin. I love the simple video. And buyers need to be aware of what they are paying for. Not that it is easy to avoid them, but at least if they are armed with information they have a choice.
Jane - Thanks! That video took me forever! I guess MTV isn't my calling LOL