This list will give you a general idea of what is usually required, and a part of the closing cost associated with a mortgage transaction in Florida .  Please keep in mind this page is designed to be helpful and does not take the place of the Good Faith Estimate.  This Estimate, along with several other documents required for signing, are provided to you within 3 business days after making application with our firm.  Typically they are emailed to the client within 24 hours.

P.O.C. Items (Paid Outside of Closing)

APPRAISAL FEE
This is charged by the appraiser directly at the time of inspection.  In some cases, (such as a new home purchase) we may request that the appraiser is paid prior to the appointment to avoid any delay with the appraisal. This fee is to research and assess the market value of the property on which a mortgage is being placed.

COURIER/MESSENGER FEES
This fee pays for overnight courier services and messenger services used to transport documents to and from the lender and to and from the local county courthouse where the deed and mortgage are recorded.

CREDIT REPORT FEE
This is charged to pay the credit bureau to provide us with a detailed report of the applicant's credit history.

DOCUMENT PREPARATION FEE
This is sometimes charged by lenders to offset costs associated with preparing paperwork for a loan closing.

FLOOD CERTIFICATION FEE
This is charged to offset fees paid by lenders to flood service companies to determine initially and on an ongoing basis, whether properties on which the lender has a mortgage are part of or become part of a "flood hazard area" (zones A & V) as determined by appropriate Federal agencies FEMA. If so, the property owner is required to obtain flood insurance.

HAZARD INSURANCE ESCROW
Similar to real estate tax escrows, many lenders require that they collect 1/12 of the property's annual hazard insurance premium with each mortgage payment to fund an escrow account from which the lender will pay the premium when it becomes due. (Hazard insurance is property insurance that you are required to purchase to cover any damage that may occur to the property itself or to someone while in or on the property.) Even though in a purchase transaction you are required to pay the first year's premium prior to or at the closing and in a refinance transaction the insurance may be paid up for many months following the closing, the escrow insures that the lender will have enough money in your escrow account when the premium next becomes due. The lender is also entitled to collect an additional amount to provide a one to two month "buffer" in your escrow account. At closing, hazard insurance escrow requirements generally range from two months in purchase transactions to anywhere from one to fifteen months in refinance transactions. There is usually an aggregate adjustment (credit) on line 1005 to offset the "buffer" overage.

INSPECTION FEE
This may be charged if a lender has to have someone inspect a property after an appraisal has been done. For example, if work being done to a property is not completed at the time the appraiser viewed the property. These are also associated with Construction-Perm Loans and the inspections required as the builder requests additional draws to continue to the next phase of construction.

MORTGAGE INSURANCE
In the event that the loan you are requesting from the lender exceeds 80% of the market value of the property being mortgaged, the lender will require you to pay for obtaining a mortgage insurance policy. This protects the lender if you default on your loan and the equity in the property is not sufficient to cover any losses the lender incurs as a result of that default. The amount of mortgage insurance premium  depends on the amount by which the "loan to value ratio" exceeds 80%, as well as the loan programs required coverage, set by the lender.

MORTGAGE INSURANCE ESCROW
In the event you are required to obtain mortgage insurance, as described above, the lender will generally require that they collect 1/12 of your mortgage insurance premium with each mortgage payment to be able to pay the premium when it next becomes due. The first year's premium is sometimes paid at closing with an additional one or two month payment being collected to begin the escrow account.

POINTS
These are fees charged by lenders that help lenders offset the costs they incur by providing you with mortgage funds. One point equals 1% of the loan amount. In a typical transaction, a borrower pays from 0 -2 points to the lender. The number of points is directly related to the interest rate in which the consumer receives. The more points a borrower pays, the lower the interest rate and vice versa.

PREPAID INTEREST
At the time you obtain a mortgage loan your first payment is generally due on the first day of the second month following your loan closing. That is because mortgages are generally paid "in arrears". (In other words, the payment being made on the first day of the month is for the interest due for the month preceding the payment.) For example, if you close on the 15th day of January, your first payment will be due on March 1 and that payment will pay for the interest accrued during the month of February. Therefore, the lender at closing, will charge you for the interest due for the period from the date of the closing to the beginning of the following month. (In our example, that period would be from January 15 to February 1.)
As a result, depending on the day of the month in which you close, prepaid interest can be from 0 days to 30 days. Prepaid interest (on a per diem basis) is calculated by multiplying the loan amount by the annual interest rate and dividing that number by 360 or 365 (depending on the lender).

REAL ESTATE TAX ESCROW
Many lenders will require that they collect 1/12 of the property's real estate taxes with each monthly mortgage payment that you make to fund a tax escrow account from which the lender will make the real estate tax payments as they become due. Since real estate tax payments are due at different times during the year, the lender may need to collect all or a portion of the next real estate tax payment at the time of your loan closing (depending on the month in which the closing occurs) to insure that they have enough money in your escrow account when the next tax payment becomes due. The lender is also entitled to collect an additional amount to provide a one to two month "buffer" in your escrow account.

SURVEY FEES
This fee is charged to pay a surveyor/engineer to survey the property being mortgaged and prepare a "plot plan" which includes a certification that the structures and other improvements on the property do not violate any property laws and do not encroach upon anyone else's property.

TITLE SEARCH FEE / TITLE EXAMINATION FEE
These fees (generally expressed as either a title search fee or a title examination fee) are charged to pay for the cost of researching and/or examining the records of the county in which the property lies to determine that the title to the property is free and clear of all defects, liens and encumbrances that could affect the use and/or value of the property.

TITLE INSURANCE FEE
This fee is charged to pay for a title insurance policy (known as a "lenders title insurance policy" which protects the lender in the event there is a defect in the title to the property. Most lenders require that such a policy be purchased by the borrower at closing. The borrower has the option of purchasing an "owner's title insurance policy" to protect the borrower's interest in the property in the event there is a defect in the title, for an additional premium. This is a good idea to have as the property owners, however, an owner's policy is not required by the lender.

UNDERWRITING FEE / PROCESSING FEE
These are types of fees charged by some lenders to offset the costs lenders incur in reviewing a borrower's application for a mortgage loan.

STATE TAXES
There are state taxes associated with most mortgage loan transactions.  Your Good Faith Estimate will have a break down on what will be applicable for your mortgage loan.  Also, there are some taxes (such as the state taxe on the deed, in Florida ) that may be paid typically by the seller, however the purchase contract may state that the buyer is required to pay those taxes / charges.

*Keep in mind the above fees / charges are here to help answer general questions.  The Final fees on the HUD-1 Settlement Statement may be the same or slighly different that those on the original Good Faith Estimate provided at the time of application.