HUD 1 ITEM

DESCRIPTION

800 Items Paid in Connection with Loan

800  One-time fees that are part of the process of approving and make the loan at the interest rate you have requested.

801 Lender’s Loan Origination Fee

801 A fee charged to the borrower by the lender for making a mortgage loan. The fee is usually computed as a percentage of the loan amount.

802 Lender’s Loan Discount Fee

802 A one-time only fee (point) by the lender to offer the interest rate you are receiving. Each point is equal to 1% of the mortgage amount. This may be tax deductible (entire amount in first year on purchase, spread over life of loan on refinance) - consult your tax advisor.

803 Appraisal Fee

803 Payment to an appraiser to research and assess the market value of the property on which a mortgage is being placed. The appraisal is required in order to determine the security of the loan and the borrower’s Loan  to Value (LTV) ratio. Appraisals cost $250-$450 depending upon your local market. Investment property appraisals cost an extra $100-$200 due to the extra forms required on investment appraisals.

804 Credit Report

804 This fee is charged by a credit service agency to provide the lender with a report detailing a borrower’s credit history. We require an independent credit report, so we cannot reuse any prior credit reports you may have.  If your credit report has information on it that you believe to be inaccurate we might need to order a full report that will cost $58.

808 Tax Service Fee

808 A lender requires research of the records of the Registry of Deeds for the county in which the property lies. Each property is reviewed to confirm that the taxes are paid in full and up to date. Any unpaid property taxes are a liability to the lender.

809 Underwriting Review

809 This is a charge for reviewing your application.

814 Yield Spread Premium

814 This amount is paid by our investor to us for closing your loan. This amount is not paid by you, nor does it increase your closing costs.

816 Origination Due Broker

816 This is another source of income on the loan for a broker. Each point is equal to 1% of the mortgage amount. This may be tax deductible (entire amount in first year on purchase, spread over life of loan on refinance) - consult your tax advisor. This and line 802 combined total the amount of points due on your loan.

818 Processing Fee

818 The fee for handling your paperwork.

819 Escrow Waiver Fee

819 If you choose to pay your taxes and insurance separately from your regular monthly mortgage payment you will pay this one-time fee. This fee is not imposed by us and we do not receive any of this fee.

900 Items Required by Lender to be Paid in Advance

900 Items that you may be required to prepay at the time of settlement, such as accrued interest, mortgage and hazard insurance premiums.

901 Interest for XX days at $XXXX per day

901  Prepaid interest due on the new loan from the date of funding to the end of the month.  Every mortgage lender clears any interest due at time of closing for the month the closing takes place. we use a 15 estimate. If you close early  in the month you will owe more interest, if you close later you will owe less. Please keep in mind that you will have one month without a mortgage payment after closing. So if you close Jan 15, your first regular payment will not be until March 1st.

902 Mortgage Insurance Premium

902 Private Mortgage Insurance (PMI) may be required on certain loans. It is paid by the borrower and insures the lender against certain losses in the event of a foreclosure.

903 Hazard Insurance Premiums

903 A lender will require you to insure the property you are buying, since the property is the collateral for the loan. At the time of closing you must pay the entire first year’s premium. If you already have hazard insurance, contact your insurance company and ask them for a copy of your insurance policy to show the lender.  We are estimating the amount of the coverage, and every borrower is free to choose the insurance provider. We will replace this figure with your actual amount once we know what the exact amount will be.

904 Flood Insurance Premiums

904 If your property is in a flood zone flood insurance may be required. It is paid by the borrower and insures the borrower and lender against certain losses in the event of a flood.

1000 Reserves Deposited with Lender

1000  Reserves held by the lender in an escrow account to pay for the borrower’s future insurance premiums and taxes. Commonly referred to as Impounds or Escrows

1001 Hazard Insurance: months at $ /mo.

1001 Impounds may be required on loans with Loan to Value (LTV) ratios over 80%.

1002 Mortgage Insurance: months at $ /mo.

1002 Impounds may be required on loans with Loan to Value (LTV) ratios over 80%.

1004  Property Taxes: months at $/mo.

1004 Estimated amount necessary to set up your escrow account. Your property taxes are being estimated at this point, and may be high or low in this assumption. Your title company will provide us with the final (and accurate) amount due prior to closing.

1006 Flood Insurance Impounds

1006 Impounds may be required on loans with Loan to Value (LTV) ratios over 80%.

1100 Title Charges

1100 Covers a variety of services performed by the title company and others. We have estimated these fees except for the $150 document preparation fee on line 1105.

1101 Settlement of Closing/Escrow Fee

1101 The fee paid to the escrow company for handling all the financial transfers and payments associated with the transaction. We have estimated the fee, but set by the closing firm your select.

1105 Document Preparation Fee

1105 Pays for the service of creating your loan documents.

1106 Notary Fee

1106 Several documents you sign during the loan must be notarized.

1107 Attorney Fee

1107 Some states require an attorney handle the closing. If you live in one of those states this is our estimated fee for their services. We do not set this fee, and you are free to negotiate this with the attorney you select to handle your closing.

1108 Title Insurance

1108 Guarantees that your home has no other liens on the property and guarantees your undisputed ownership. All lenders require that you have title insurance on the home.

1112 Title Search

1112 Most closing firms will require the title history on your loan to be reviewed before they can issue a new title policy. Most firms include this in their general fees (line 1101). We list it separately to be conservative.

1200 Government Recording Transfer Fees

1200  Fees paid by either the buyer or seller at the time the purchase agreement is executed.

1201 Recording Fees

1201 To create a public record of your legal ownership of the property, the lenders notify the county government to record the transaction. The recording fee, which varies by state, is paid to the county.

1202 City/County Tax/Stamps

1202 Stamps, affixed to the deed, showing the amount of transfer tax paid. Most states stamp the deed rather then actually affixing a stamp. Many localities collect a transfer tax whenever a property changes hands.

1203 State Tax/Stamps

1203 Stamps, affixed to the deed, showing the amount of transfer tax paid. Some collect a mortgage tax anytime a new mortgage is recorded.

1300 Additional Settlement Charges

1300 A grouping of other misc. fees and credits

1301 Survey

1301 Some states require a survey before the loan can be fully approved and cleared for closing. The actual cost is set by the title firm and has been estimated here.

1305 Flood Certification

1305 Cost of the flood zone determination to confirm if the property is /is not in a flood zone.

1307 Funding Fee

1307 The cost of the wire transfer.

1308 Paid Fees / Costs

1308 This is the amount of money that we are crediting you at closing. It is listed as rebate/negative points on your Service Agreement