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Padawan73 · Joined: 21 Dec 2007 Posts: 2 1.84 Dollars($)

I received a good offer to refinance my 30 mortgage into a 15 year mortgage at a better rate and recieve cash in return to pay off my cars. There is a fee of $500 to process the application. It is my current mortgage company and I have been late once in 10 years....my credit is excellent and have received other offers. Do you think if I said I would commit to it if the fee was waived....what do you think they would say? Please advice.

sara · Posted: Mon Dec 24, 2007 2:34 am Post subject: RE: application fee

Hi Padawan,

Let me congratulate you for getting a good offer. Smile

As far as the application fee is concerned, the lender charges it as a compensation for the costs involved in processing the application. So, I guess the lender won't waive it entirely, at the most, he may include it in your loan amount. In that case, your payments will be calculated on a slightly higher amount.

I think if you can have a talk with the lender, things will be just fine.

Take Care

jenkin7 · Posted: Mon Dec 24, 2007 2:42 am Post subject:

Hello Padawan,

Welcome to the forums.

You may negotiate with your lender but since he has already asked for a $500 fee, I'm not sure if he can waive the entire cost. You may talk to him and convince him to lower the fees.

You can also try out another option. You may include this fee along with the closing costs so that you may get some time to arrange for that or else you can also include that in the loan amount. You have to talk to your lender and see if he is willing to work out any of the options.

larry · Joined: 27 Jun 2007 Posts: 3322 474.67 Dollars($)

Hi Padawan,

Sara and Jenkin have given sound suggestion. I agree with then. Waiving the entire fees may not be possible but you can surely request the lender to reduce the fees to a certain extent.

Best of luck,
Happy Holidays

gmakerley · Posted: Wed Dec 26, 2007 1:14 pm Post subject:

by all means, negotiate. what have you to lose?

shayneroy · Joined: 12 Nov 2007 Posts: 51 21.08 Dollars($)

Application fee covers the lender's cost of processing your loan request. There are a few lenders out there who refund the application fee if the loan is funded. You can surely go ahead and negotiate on it. FYI, if you have recieved the Good Faith Estimate from the lender, every thing on the '800 series' can be changed since it's in the discretion of the lenders / brokers.

banker0679 · Posted: Thu Dec 27, 2007 6:27 pm Post subject:

Don't pay it! If it will pay your appraisal....then that will be a different story. It's normal to ask for an appraisal fee upfront...which can be from 300-500 depending in your state.

Shop around!

Posted: Sat Dec 29, 2007 1:37 pm Post subject:

Thanks. I received a fixed 15 year. Rate of 5.9

banker0679 · Posted: Sat Dec 29, 2007 2:53 pm Post subject:

OMG the 15 yr fixed...are at 5.25%-5.375%

Banker....please refrain from making steering statements.......you don't have nearly enough information from the OP to make a judgement as to the validity of the rate......for all you know it could be an EA level 2 taking cash out to 90% with a 600 mid score.......

rick · Posted: Sat Dec 29, 2007 4:14 pm Post subject:

PLEASE....shop around...the above reply is in the ballpark, although any loan rate certainly depends on the several factors lenders look at to qualify you for the best rates.

And...everything is negotiable when it comes to fees charged by a Mortgage Broker - even processing. Yes, I am a mortgage broker and I have to pay my processor - but it certainly is up to me whether I wish to accept less compensation to do a loan - as would be the case for any mortgage broker.

ckalvesmaki · Posted: Sat Dec 29, 2007 4:33 pm Post subject:

I think we are jumping the gun on the shop around......this is a cash out transaction. The loan to value hasn't been posted......the credit score info hasn't been posted nor has the type of loan.....

To the OP......It is always a good idea to get more than one quote...having said that......not knowing what state you are in......an application fee is a perfectly legitimate charge.....as an example.......in NC a broker is not allowed to charge a processing fee which can encompass both credit and the cost of the appraisal. If you would like to post you feull GFE along with your credit score info and the amount of the loan as well as the value of your house......we can give you a better picture as to the terms of the deal you are getting.....

rick · Posted: Sat Dec 29, 2007 4:53 pm Post subject:

Cedric is right...a "processing" fee is perfectly legitimate - I think no one denies that -- but it is negotiable.

Good luck,

Rick

Caron · Posted: Sun Dec 30, 2007 11:41 pm Post subject: RE: application fee required?

Right you are CKalvesmaki, he can provide his GFE details and then we all can help him understand the costs. And, regarding the processing fee, I think it's an absolute requirement, none can deny it. At the same time, I've coem to hear of lenders who refund the application fee on certain grounds.

good luck

lisascherzer · Joined: 04 Jan 2008 Posts: 755 1.12 Dollars($)

Most lenders do not charge a processing fee. I would be leary of them taking money upfront. Do you know if your rate is locked? Basically they get to keep the 500 if your loan doesnt close. I bet if you compared mortgage lenders right now, you would find a comparable if not better deal without an upfront cost. edited for solicitation[Link deactivated as per forum rules. Thanks.]

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