Understanding Your Loan Estimate: Other Costs
Your Closing disclosure will contain an area showing you other costs of your mortgage. These may include: taxes, certain pre-payments, and escrow funding.
Recording fees are charged by government agencies for keeping legal ownership records, while “transfer taxes” may be imposed by states, counties and municipalities on real estate ownership transfers.
Prepayments may include homeowner’s insurance premiums on the property mortgage insurance, if required property taxes for a period of months in advance, and prepaid interest, typically for the period from closing to the first mortgage payment.
Escrow funding may also be required against future annual charges for homeowners insurance, mortgage insurance and property taxes.
Understanding Your Loan Estimate: Other Costs
Another important fee you’ll see on this section of the Closing Disclosure is for title insurance. This is an optional purchase, but most buyers purchase title insurance to protect their legal ownership under an “Owner’s Title Policy”
For more information on title insurance, be sure to call us, and review our Resources page.
Some of these “Other Costs” may vary substantially between Loan Estimate and Closing Disclosure ask your lender about the tolerance rules or watch the video “Could My Loan Cost Exceed The Loan Estimate?”
Most title agents won’t take the time to help you understand your Closing Disclosure. But we will!
At First Title & Abstract we believe in “Putting You FIRST!”
Realtors and lenders have come to recommend us as the top title company in Naples and Marco Island. For nearly forty years, we’ve served our clients successfully, always with friendly and professional service.
We look forward to assisting you with your closing, and answering any questions you may have!