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caleb8673 · Joined: 10 Feb 2009 Posts: 1 1.37 Dollars($)

I am looking to refinance my loan and pull out equity for remodeling. I can get a FHA at 5% with 5,317.58 in closing costs and 6,088.03 in pre paid items/reserves. The total is 11,405.61 !!!! This seems like a lot but I never had mortgage insurance before. I understand the need but the numbers seem high.

sara · Posted: Wed Feb 11, 2009 6:45 am Post subject:

Yes, I do feel it's quite a big amount as far as closing costs and prepaid items/reserves are concerned. What amount of upfront premium is the lender charging on your FHA mortgage insurance? I guess you should ask him to break down the costs and explain them in details before you sign on any documents.

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The refinance loan is for 216,727.00, I owe 133,300.00. The prepayment on mortgage insurance is 3,727.50, tax reserves 1,619.52, hazard insurance 440.00, and pre paid interest 301.01. The closing was without a broker fee until the rates rose then to get them back to 5% I would pay a 1% broker fee of 2,130.00. There is also a 395.00 processing fee and a 595.00 admin fee that I am questioning, along with underwriting, inspection, wire transfer, flood cert., escrow, title insurance and credit report to get the grand total of 5,317.58.

vegas_storms · Joined: 12 Sep 2008 Posts: 67 3.54 Dollars($)

It's really not that far out there for a FHA. Your looking at roughly 2.5% for the actually refinance fee and prepaids are prepaids are prepaids as we say, no way around that unless you sign on a different day of the month.

As long as rates actually went up and the broker isn't trying to back door that extra 1% fee on you, then your fine

ashleyblanton · Posted: Fri Feb 13, 2009 3:10 pm Post subject:

"There is also a 395.00 processing fee and a 595.00 admin fee that I am questioning, along with underwriting, inspection, wire transfer, flood cert., escrow, title insurance and credit report"

These are all items that are legit. They vary from lender to lender. The lenders I use do not generally have inspection fees, but all the others are usually tacked in there. These are 3rd party fees that can't be negotiated.

Your upfront MIP is 1.75% of the loan amt. This is an FHA standard, this is why your closing costs are so high.

eric1 · Posted: Fri Feb 13, 2009 5:44 pm Post subject:

The bottom line is this....
You are getting a cash out refinance at a rate of 5%. Consider yourself lucky.

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Are these settlement charges normal or within range of normal?