Which Costs Are Reasonable or Negotiable?
January 10, 2000
"My mortgage broker gave me the following list of costs…Could you tell me which of these are unreasonable and/or negotiable?"
Settlement costs for different services vary from locality to locality. Sometimes the names of the charges change. Sometimes one large charge (typically an "origination fee") replaces numerous smaller charges. It just isn't possible, therefore, to answer the question of which individual costs are "reasonable".
What matters is the total costs for which the lender is responsible. These include application, origination and commitment fees, points, and other charges made by the lender or mortgage broker. This is the number you should compare across different mortgage brokers or lenders. For further discussion, read How to Shop Settlement Costs.
If you are in a shopping mode, the total is negotiable. Once you have made it clear you are committed to a particular lender or broker, don't expect them to negotiate anything.
"My mortgage broker gave me the following list of costs…Could you tell me which of these are unreasonable and/or negotiable?"
Settlement costs for different services vary from locality to locality. Sometimes the names of the charges change. Sometimes one large charge (typically an "origination fee") replaces numerous smaller charges. It just isn't possible, therefore, to answer the question of which individual costs are "reasonable".
What matters is the total costs for which the lender is responsible. These include application, origination and commitment fees, points, and other charges made by the lender or mortgage broker. This is the number you should compare across different mortgage brokers or lenders. For further discussion, read How to Shop Settlement Costs.
If you are in a shopping mode, the total is negotiable. Once you have made it clear you are committed to a particular lender or broker, don't expect them to negotiate anything.