Super Contributor
ShanetheMortgageMan
Posts: 8,174
Registered: ‎09-28-2007
Re: Good Faith Estimates Explained
The Section 800 costs are determined by the originator, and since the originator is the one providing the GFE to you, their charges should be consistent from the beginning until the end.

Line 801 is the Origination Fee & Line 802 is the Loan Discount Fee, when both or one or another is being charged it means you are getting a lower interest rate than if you were not being charged an Origination or Loan Discount Fee. This is negotiable, if you want the Origination or Loan Discount Fee to be reduced, you can accept a higher interest rate (in .125% increments). You can ask your loan officer for various GFE’s for each interest rate you so desire. It is not uncommon to ask for a GFE for (example) a 6.000%, 6.125%, and 6.250% interest rate to compare all of the payments and charges. Your loan officer should also give you feedback on which interest rate/costs scenario would be better for your situation.

Line 803 is the Appraisal Fee. This is determined by the appraiser that is being used on your mortgage transaction. The appraisal fee varies depending on the customary fee for the area you are doing the mortgage financing in, the type of appraisal, and the complexity of the appraisal. On average it’ll be about $300, but in some areas it can be $400 on average. An FHA, USDA or VA appraisal, rent survey & operating income statements (for rental properties) add additional costs to the appraisal fee. The reason the appraisal fee in this example is in parenthesis is because the appraisal fee was paid directly to the appraiser outside of closing (POC – paid outside of closing) rather than at the closing of the loan, which is typical for an appraisal fee.

Line 804 is the Credit Report Fee. It’s about 50/50 if you’ll be charged for the credit report fee; it is definitely something that is common though. You should only be charged for the amount the credit report costs, if you see a high credit report fee above the $25-30 range then it’s suggested you ask to see an invoice for the credit report fee to make sure you aren’t being charged more than the actual charge to the originator.

Line 805 is used when the lender needs to inspect the home for one reason or another – for example if there is a question on occupancy of the home, if the property is somewhat commercial in nature so the lender wants to determine if it still has a residential feel, etc. Common amount for a Lender Inspection Fee is around $150, but it’s not a very common fee.

Line 808 is a fee that is being charged when you use a Mortgage Broker. Not all mortgage brokers charge a fee on line 808, and more often than not there isn’t one. If one is being charged, it serves the same purpose as Line 801, so it is negotiable just like an Origination Fee is.

Line 809 is a Tax Service Fee, which is charged by the lender to handle the property tax information on a home. This may cover the costs of establishing and maintaining an escrow account as well as making sure that property taxes are being paid on time.

Line 810 is a Processing Fee. This is charged for the processing of the loan. It is most commonly charged on brokered mortgage transactions but lenders may charge a processing fee as well. Average for a processing fee is $300 up to $600, and can sometimes be negotiable.

Line 811 is an Underwriting Fee. This is charged by the lender to cover their underwriting costs. Can be anywhere from $400 up to $1,000, and is usually not negotiable. Sometimes instead of charging an underwriting fee, lenders will charge an Admin fee, or a combination of Underwriting/Doc Prep/Funding fees, that when all totaled up will be in the $400 to $1,000 range. For this fee a majority of lenders will be in the $400-750 range though.

Line 812 is the Wire Transfer Fee. Wiring funds from the lender to the title/escrow/attorney company costs money and this is the lender’s way of recouping their costs for that.

Line 813 is the Flood Certificate Fee. On every loan a flood certificate is obtained to determine if the property is in a flood zone or not, charging for this service is the lenders way of recouping their costs for obtaining the flood certificate.