It is a great thing to find out how to get lower closing costs before you go into the closing table. Many companies want the most money out of you and will try to pad their prices with extra costs. The following are guidelines of what you need to do to pay a lower price:
Shop around for lenders and mortgage companies and find out how much their different services cost.
Once you receive your Good-Faith Estimate ask the lender to explain these costs to you in more detail.
Negotiate the costs on the Good-Faith Estimate; usually the easiest costs to negotiate are found in the 1100’s and are the title insurance, title search, title exam, attorney’s fee, and settlement fees.
Be sure that the costs are the same at the closing table as they were in the Good Faith Estimate and that no new costs have occurred. If they have make the lender describe them in full to you, and do not be afraid to negotiate.
When refinancing your home try not to close during the first of the month in order to save money on interest.
Find out how much the county charges to record the deed with them and do not pay more than this on the closing table.
Mortgage Broker fees are percentages that the Broker charges in order to make money on finding you a loan. There is a way to not have to pay this fee and that is called a “yield spread premium”: the Broker pays this fee and you pay a higher percentage.
Ask for a receipt of how much the mortgage company paid on the appraisal fee, survey fee, flood certification fee, credit report fee, courier Fee, and abstract or title search fee. Do not pay any more than the price listed on the receipt.
For the notary fees ask how many pages had to be notarized and how much the charge was per page then see if they will negotiate to this price.
If the seller purchased the house less than 10 years ago you can get a “reissue rate” instead of paying the full price for the title insurance fee. All you have to do to get the “reissue rate” is have the seller give you with a copy of their existing title insurance policy. This discount is around 40 percent.
The underwriting fees, document preparation fee, and administrative fee which covers underwriting and document preparation fees are fees that could be taken off the closing price all together. Sometimes these two fees are together and are called the administrative fee.
The loan origination fee and mortgage broker fee are fees that are tax deductible so you can write this off on your taxes the following year.
Funding fee/wiring fee is charged by the company for them to get the money to you. This fee might be able to be waived because you are already getting the money.
Tax service fee/escrow fee can potentially be less costly if you pay for property taxes on your own, instead of having the lender take an amount out every month.
Shop around at different lenders and mortgage companies for the following items:
For the closing fee shop around and find the cheapest closing fee around. The settlement fee is the same thing as the closing fee and should not be on the sheet also; if it is you are being charged twice for the same item.
Title examination fees are fees that you want to shop around for to find the best price. Some lenders charge nothing for this service and some do charge. During a title examination agents analyze the results of the title search to make sure there are no discrepancies on the title.
Shop around for the release of lien fee because some companies charge while others do not.
Ask the lender if the price could change at the closing table and by how much. Make sure you write down the lender's name that told you this and even better get a paper signed by the person with this information on it to protect yourself against added costs at the closing table.