Broker and Loan Officer Fees

• The loan officer or broker may charge you many different fees, including origination fees, discount fees, an application fee, a processing fee and a commitment or lock fee, to name a few. All of the loan officers or loan broker's fees must be disclosed using sections 1 and 2 of the GFE. Sometimes loan officers or loan brokers place some of the processing and other fees in section 3. Some processing companies actually belong to the loan officer's company. Some companies contract with third-party processing companies that have no affiliation with the originator's company. All of the items listed in sections 1 and 2 of the GFE may be negotiated.
  
  

Third-Party Fees

• Most loans require third parties to provide certain services during loan approval. Lenders require appraisals from licensed appraisers, title policies from title insurance companies or title attorney offices and credit reports from credit reporting companies. These companies charge a fee, which normally is not negotiable. Usually the borrower cannot choose the appraiser but can choose the title company or title attorney's office. While the borrower cannot negotiate these fees, the borrower may shop around to find the best available fee for the services.The lender also may not increase the costs of these fees to make additional money.
  
  

Lender Fees

• Most lenders charge fees for underwriting and closing a mortgage. Usually the homeowner cannot have contact with the lender prior to loan approval. This allows the mortgage company to objectively review the loan and make a lending decision. The homeowner may not negotiate these fees directly but can request that the loan officer negotiate these fees for her. Many loan officers and brokers have good relationships with their lenders and can occasionally ask for a reduction of fees on a particular loan.
  
  

Loan Changes

• Federal law requires the amount charged at closing to be equal or less than that on the GFE. This presumes the terms of the mortgage do not change during the application and approval process. If the homeowner requests a loan amount change or an interest rate change, the lender may re-disclose and re-price the entire mortgage. Once a homeowner negotiates a set price, he should try to not change any of the terms of the loan unless he wants to renegotiate the mortgage.