You may be paying too much in closing costs for your real estate.

Recently, a client of mine closed a purchase money loan with a big lender, who shall remain nameless but whose initials are Quicken. (oops) Although the client paid the going rate for interest that any other lender would charge, the fees the lender tacked on were way high -- 2% origination fee, processing, underwriting, etc. And then both the title and escrow company loaded on what we call garbage fees. These, too, were higher than what's competitive in the market. If you are buying or selling a home, please ask your Realtor to review the lender estimates and the final estimates before you automatically pay them -- you could save a $1000 or more out-of-pocket closing costs.

The Realtor buys a house: What I re-learned

If you've been reading this blog, you know that my husband and I bought a townhouse in Studio City.  This will likely be the last of the "Realtor buys a place" posts.  I go through all of this all the time with my home buyers and sellers, but somehow, when you do it yourself, it's...different.  Anyway, here's what I re-learned.

1.  No matter how excellent you lender and staff are, the loan paperwork is burdensome.  And some of what lenders ask for? It's unbelievable.  Thank God for the ability to scan.  Here's a picture of all the stuff we have to keep.

2.  Many of the disclosures are redundant, and after you've signed about 100, you tend to take them less seriously.  We signed a disclosure about the Mullholland Scenic Parkway (wha?) three separate times.  The disclosures are worth reading, though.

3. The inspection period is a little nerve-wracking.  Power through it.  With appropriate drugs if necessary.

4.  I still don't know what many of the closing fees are for.  After all these years, I can't get a straight answer from anybody at an escrow company or a title company about what they are, either.  I'm talking about "loan tie-in fees" and "sub-escrow fees" and miscellaneous other fees.  The best answer I got was "Oh, those are for doing all the paperwork." Okay, then what are the fee fees for?  Good news here: there are very few lender junk fees these days.

5. And, at the risk of stating the obvious, moving is hell!

Everybody makes mistakes, even title companies and management companies

Long, boring story short and boring: my buyer client has an accepted offer on 1809 Peyton in Burbank, but the condo must "go" FHA in order for him to get a loan.  Fine.  Reams and reams of paperwork need to be submitted to FHA and the condo documents have to be examined in very close detail.  Fine.  But it's been about 60 days now, and the listing agent is really steaming over how long this is taking. Fine, but don't tell him that.

Just yesterday, the FHA folks noticed that the preliminary title report from the title company was wrong -- it had a map of a building down the street. Considering how much title insurance costs and how many people view the title company documents, this is pretty surprising.  And, the building's management company had certified that the complex had 46 units in it when it only has 42.  Nice to know they are collecting the HOA dues in that building.  Aberdeen has made several paperwork mistakes in this transaction, but you'd think they'd at least know how many units are in one project.

So these conditions have now been caught and remedied by the lender at Prospect Mortgage, Dana Dukelow, and his staff.  But the listing agent would still like to kick us out of escrow.  Stay tuned...