AgentMortgage

Feds play role in cheating real estate borrowers

Future-Proof: Navigate Threats, Seize Opportunities at ICNY 2018 | Jan 22-26 at the Marriott Marquis, Times Square, New York

Q: "I see that the Upfront Mortgage Broker commitment now includes a guarantee of lender fees. What fees are covered, and why is a guarantee needed?" LENDER FEES Mortgage lenders charge two kinds of fees. One type, expressed as a percent of the loan amount, is called "points" and sometimes "origination fee." Points are considered part of the price of the loan, along with the rate. When lenders lock the rate, they also lock the points. The lock protects the borrower against any subsequent changes in the market that would raise the rate or points. Lenders also charge fees for various functions they perform, such as loan processing or underwriting, which are expressed in dollars. They do not vary with the size of the loan. These fixed-dollar fees are not considered part of the price of the loan, and aren't included in rate locks. The presumption is that since these fees aren't affected by changes in the market, the borrower does not need lock protection. Unfortunately, this presumption ...