@Scott Meyers ,
There are many ways to tackle these fees. I will share with you how I do it * "This is not advice". I am sure many others can offer their suggestions. 1- "EDUCATION" know the lingo. Read, visit podcasts and as many BP posts about closings and you will see all these different fees "via the banking/ lending world's own terminology creation" that people here are charged for in the loan process. I did not have these resources and I wish I did. You do so use them!
Find out what these terms mean and why you are being charged them and then you will begin to see you often can negotiate or "shop" directly at the providers of these needed sources. Eliminating the "middle woman/man". But again be educated. The sources hate amateurs, know the lingo. Do not be afraid to ask questions but again know terminology it really is not hard if you take your time.
PLEASE do not be intimidated. This is your hard/easy earned money we are talking about but at the same time the persons you are talking to need to make money so they can do what you are doing. Most people say Time = Money. Grandma always said "Those educated often control the greatest assets of all, time & money". I should have listened earlier...
Scott, I am going to jump around a bit because not every closing/deal is the same. Hence, there might be different fees involved so I am going to just start with the traditional loan/mortgage then go backwards to Lawyers fees. These items I am going to discuss is what I deal with in NJ. In other states there are other regulations and requirements so be aware of that. As you do more deals the process becomes so much easier as it is very redundant. That said do not become lazy. Some things are in place for a reason and some things you need to understand such as risk and reward.
Origination fees- UGHH OMG R u kidding me. You Ms./Mr banker/loan originator/loan officer/ "SALESPERSON" are going to charge me an additional fee to which I am already going to pay you a fee for when I borrow money from your company or source through the interest you charge me. I say NO WAY!
Simple solution "HAVE FUN" shop! Call every lender and mortgage company you can find on the internet/ in newspapers/ direct mail/your wond bank that lends and tell them what (in there language) you are seeking. EX. Jeff: Hi Sue from ABC mortgage company, this is Jeff how are you today? Sue: I am wonderful today and thank you for asking. how may I help you today? Jeff: I am seeking a loan to buy a home and I was wondering if I might ask you some questions and hopefully we can do some business together" SUE: Sure Jeff ask away but is this for a home you are purchasing to live in or are is this an investment property?.(you just got prequalified as a client with this question). Know if you are a first time home buyer she /he knows there is more hand holding. If you are a homeowner already and have been through the process before there is often less AND there are/might be different products and terms (more time needed for the bank to do due diligence/ more risk blah blah blah) between these types of loans which might be why they charge different rates. So again if you are already educated by BP you know this. Here is the trick/tip If you are educated the less hand holding and the easier (less time) the officer then the processor then the unwritting dept and so on needs to spend with you. If you can portray yourself as being educated and use the lingo they use you can ask for more in my opinion.
Jeff: Sue I see on the internet/direct mail advertisement you are offering a reduced rate for loan origination I was hoping I might eliminate them as I have been calling around and I was surprised some are. They say because I have good "credit score" over 740 (from educating myself and having a "currrent" copy of my credit report) I have a very low "debt to income ratio income" (from educating myself to know what that means) and I have a great job (last three pay periods of pay stubs and last 3 months of bank statements last two/three years of tax returns) and from what I have seen on the internet and been told by others I can afford a "total" mortgage payment of $1500.00 a month of course this includes taxes, mip, home owners insurance, HOA and such (again educating your self using online tools available at a host of places). What do you think? Can you do it or should I keep shopping? I see everyone's rates and they are very competitive (again through educating and observing the rates being charged on avg.on-line you have a good idea what they are) so I am just trying to eliminate those extra fees. Sue, I am sure you understand...
Even if he/she says she cannot reduce/eliminate the fees you can ask to speak to her/his supervisor or just move on to the next lender. BTW often the lender that says "no"! will often call back or send you in the mail or via the internet a piece that will allow you to "re-negotiate" remember they are in the business of lending money to qualified educated buyers like you.
lastly, another tip is to have a lender (mortgage company, bank, credit union) go through all the paperwork and have them send you a "GOOD FAITH" estimate it will have a list of "anticipated fees" both you will pay to the lender and you will pay out of pocket directly to another company in the process (appraiser, termite inspector and or etc) when you get this good faith estimate call and say the origination fee is unacceptable after all you are an educated buyer and hope to use your bank for additional deals surely you can get rid of these fees. Do not be afraid to seek other lenders IMHO you will find one that will negotiate with you and because of that they will remember you and you them. If your lender is good to you always refer your friends and associates to them and tell them to get educated as that will allow them to save money.
Disclaimer; This is not legal advice nor anything like that. You might want to consult a lawyer, pastor or your grandmother first. This is just from my personal experiences I am not a professional anything and I like It like that. I am just sharing that is all.
