Upon closing on a house, you will receive a settlement statement. This document itemizes all of the monetary transactions that are involved. However, it’s not always easy to understand. Here are definitions of a few of the terms that commonly appear on a settlement statement.
• Loan origination fee: A fee charged by the lender for processing the loan.
• Appraisal fee: The cost of having the property appraised (assessing its market value).
• Credit report: A report of your credit history that a lender uses to determine your creditworthiness. It shows your history of borrowing and repaying money.
• Documentation preparation: The cost of preparing all of the documents for closing.
• Final inspection: The cost for performing a final inspection to make sure all agreed-upon repairs have been completed.
• Title: The cost of the document that proves ownership of the property.
• Notary fee: The fee for having a person, who is licensed as a public notary, verify the signatures on the document.
• Attorney fees: Many states require an attorney to be a part of the closing process. A fee for this service may appear on the settlement statement.
• Title insurance: Protects lenders and property owners against any potential hidden claims against a property.
• Photocopies/facsimile fees: Charges for all of the paperwork.