Something to remember: the costs of concluding a reverse mortgage will be lofty. It doesn't make a difference where you reside.
If you have a very low valued home it can be as much as ten percent of your value. Typically it runs about 5% of your total value as determined by a licensed FHA appraiser.
In my line of work, I talk to borrowers all the time that are not aware of this fact. Sometimes my company even gets the rap for how rough the costs can be.
So, who do we blame when there is no one else to blame? Mostly people like to point their fingers at the mortgage company. Those greedy pigs.
About 7 separate entities make up the entire closing process, the Federal government being one of these.
A closing document called the Good Faith Estimate of Costs separates and shows all of the closing costs, one of which is the origination fee. It is the sole fee from the bank.
Is it sizable? Yes. Does it take up the lions share of cost. No.
The culprit behind the bulk of the cost is the mortgage insurance. Two percent of the homes worth (for homes worth $417K and below) is billed to the borrower.
FHA can charge up to eight thousand, three hundred and forty bucks, while the bank charges as much as six thousand for origination.
This is newly legislated by the way. I think its funny that the government has no problem capping how much money the lender can make, but they don't cap how much they can charge.
This is a side-note.. Did you notice all the phone calls wanting campaign donations? Yes, they are excluded from the National Do-Not-Call rules.
Back to costs. The title or escrow company takes a big chunk of the costs as well, between title insurance, additional binders, and their fee for conducting the transaction.
Also add in the official appraisal cost. Sometimes a land inspection is needed as well. These fees are pretty expensive.
I don't know about every states specifications, but rest assured there are other little factors that add to costs as well, and as I said in the beginning, the lender isn't the only one to blame.
If you have a very low valued home it can be as much as ten percent of your value. Typically it runs about 5% of your total value as determined by a licensed FHA appraiser.
In my line of work, I talk to borrowers all the time that are not aware of this fact. Sometimes my company even gets the rap for how rough the costs can be.
So, who do we blame when there is no one else to blame? Mostly people like to point their fingers at the mortgage company. Those greedy pigs.
About 7 separate entities make up the entire closing process, the Federal government being one of these.
A closing document called the Good Faith Estimate of Costs separates and shows all of the closing costs, one of which is the origination fee. It is the sole fee from the bank.
Is it sizable? Yes. Does it take up the lions share of cost. No.
The culprit behind the bulk of the cost is the mortgage insurance. Two percent of the homes worth (for homes worth $417K and below) is billed to the borrower.
FHA can charge up to eight thousand, three hundred and forty bucks, while the bank charges as much as six thousand for origination.
This is newly legislated by the way. I think its funny that the government has no problem capping how much money the lender can make, but they don't cap how much they can charge.
This is a side-note.. Did you notice all the phone calls wanting campaign donations? Yes, they are excluded from the National Do-Not-Call rules.
Back to costs. The title or escrow company takes a big chunk of the costs as well, between title insurance, additional binders, and their fee for conducting the transaction.
Also add in the official appraisal cost. Sometimes a land inspection is needed as well. These fees are pretty expensive.
I don't know about every states specifications, but rest assured there are other little factors that add to costs as well, and as I said in the beginning, the lender isn't the only one to blame.
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