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Jonathan Dalton
ePro, SFR

7,000 Reasons You MUST Know Your Lender

7,000 Reasons You MUST Know Your Lender

avatarthumbnail.jpgAnd I don’t mean know your lender in the social sense, but rather the fees that your lender is going to be charging you to get your loan done.

This morning I received the pre-audit for someone closing a home today and there was a fee that had not appeared on the Good Faith Estimates:

Broker Admin Fee … $7,516.

Lenders, of course, are allowed to earn a living. There’s no disputing that. But a broker admin fee charged by a mortgage broker (who “brokers” the deal through an actual lender) that’s roughly 3% of the loan amount?

On an FHA loan and a program where a buyer only can bring in 3% total?

If you’re using a lender, make sure you understand the fees that are being charged. If you are using a mortgage broker, make sure you understand how they’ll be making their money on the transaction.

Not knowing nearly cost these buyers thousands of dollars today.

[tags]Phoenix real estate, real estate financing[/tags]

No Comments

  • Jim Little says:

    Isn’t a broker admin fee a part of the cost of a loan? If so, and it isn’t on the GFE doesn’t that mean the broker is in violation?

  • There was a field for it on the last GFE but it was blank. The estimated cost of discount points went down from the GFE, but then this fee appeared.

    Net result was a large increase in what was needed to close.

  • Jim Little says:

    Jonathon, it still sounds like a violation of Truth-in-Lending to me. It also proves your point, know your lender.

  • I’m going to be a wuss and dance away from it though you might be right, Jim.

    Even if it had been disclosed … wow. I mean, wow. That was the first thought when I saw that number appear.

  • Ouch! I feel like I got the wind knocked outta me. Sadly, these fees are deceptive in that they’re not presented till you’re at the closing table.

    I had a prospect call me (a lead from the web)…incidentally we met at a conference years ago…she had a closing and upon reviewing the final HUD she caught something much like this and decided to walk away. The crazy part was her father was saying, “no c’mon let’s get it over and done with, just sign it.” Can you believe that?

    I was proud of her for walking but could you imagine how many people just up and sign.

    I always say, ask questions and if you’re not getting any answers, you’re working with the wrong professional.

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