Mortgage Q & A: Can We Negotiate Mortgage Closing Costs?

Q: I'm buying a home on a tight budget-- just squeaked by on qualifying for mortgage--and am surprised by all of the lender fees and charges shown on our Good Faith Estimate. Can I negotiate with my mortgage lender on some of this? And what about the other stuff, like appraisal fees and title company charges?

A: While your mortgage lender may agree to work with you, not all fees can be negotiated. For example, you don't get to choose your appraiser (and neither does your lender!). Recording fees (charged by your county or MSA), pro-rated property taxes and mortgage interest are also not negotiable. That said, you can shop and compare costs for title insurance, homeowners insurance and escrow services.

It's also possible that your closing costs could change between the time your estimate is issued and your mortgage loan closes. Some costs (such as lender charges) cannot change between the issuance of the last GFE you get from your lender and closing. Others (such and homeowners insurance from a provider you choose) can change without limit and still others, such as required services that the lender selects, such as appraisers, cannot increase by more than ten percent or the lender has to eat the excess.

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