ITEMIZATION OF SETTLEMENT CHARGES Why so high?

[adymax]

I'm getting aggravated by the builder's lender chargers. We are getting an FHA loan and with upfront MPI of $3660  and $2500 in closing fees paid by lender, plus another $6000 in down payment assistance from the state and still have to come up with $6000 for a $211K loan.

Here are the fees:

Origination Fee: $1080.43

MERS Free $11.95 -paid by lender (PBL)

Underwriting Fee $300 PBL

Processing Fee $350 PBL

Bond Participation Fee $500 PBL

Escrow Holdback Fee  $200 PBL

Appraisal Fee $375

Credit Report Fee $60

Final Inspection Fee $150 

Title Services and Lender Title Insurance $1275  

Owners Title Insurance $496

Government Recording ,Transfer Taxes $486

Initial Escrow and hazard Insurance around $440

HOA Capital $330

This comes total l of $10,240     

Why so many fees?

[stephtmjls]

When I add that up, it only comes to $6,042. Is it possible the total includes your down payment? If not, something listed here is not correct.

Edit:- the total is actually less if you are saying everything with PBL is Paid by Lender.

[adymax]

Yes PBL is paid by lender . You have to add Up front PMI of $3670. 

So basically closing costs are $10.350 and $2500 are paid by lender. Loan is $211K, purchase price $216K.

Credits: $6000 down payment assistance+$2500 lender closing credit+$6000 down payment=$14500 in credits

$216K+$10K (closing costs)=226K-$14.5K (credit)=211.5K loan amount 

 Are these fees inflated  ?

[StartingOver10]

The UFMIP is financed into the loan usually - not paid cash at closing. Get with your LO and ask why they aren't financing it into the loan.

Also the title company will do thhe final reconciliation on the HUD1 showing tax credits and reserve account info (also called escrow accounts or impound accounts). If you have already paid for your hazard/homeowners insurance you will see that credit. the main issue is you haven't been shown the other credits yet and you should have seen the UPMIP financed in the final loan.

[adymax]

It may be. All I know the purchase price is  $216K and after closing costs and down payment of 6K+lender closing credits+6K down payments state assistance the loan will be 211K. What I don’t like is that 6K down payment state assistance is a 10 year loan forgivable but you cannot sell or refinance in the 10 year period which sucks. In top of this state imposes a rate of 4.25% if we go with down payment assistance or 3.75% if we don’t want down payment help.  At this  point we may just go with 3.75% rate and put more down payment because who knows what the rates will be 5 month from now when the house gets build. We deal with a LO over the internet and phone but we ask to meet a local LO tomorrow and I’ll have more questions answered.

[ericschmerick]

Fee list looks about like mine.  Ratio is about the same as well (total closing cost to loan amount).  PMI is a bummer.  Solution would be to come up with $43k in down payment, and then a little more for reserves, and then a little more for these closing costs.  So you're stuck with PMI (not just this up front cost, but every month until you get below 80% LTV).  I was surprised too when I bought my first house that you needed another basically 2% of the house price in cash just to close the deal, but that's how it works.

[deg757]

Our purchase price was $226k, so pretty close to yours. Our closing costs, including the upfront PMI, were $12,083. We rolled the upfront PMI into the loan so only ended up paying the 3.5% at the table which was right at $8k.

[adymax]

Thank you for your answers. We’ll move forward with this lender.