Page 26 - the latest homebuying guide

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Discount Points: You may choose to pay a lump sum at closing to
reduce your monthly payment by purchasing points. One point is
worth one percent of your purchase price.

Escrow Deposit: You may have to pay a portion of insurance and
property taxes into an escrow account. The monthly obligations
are then turned over to the taxing authority and insurance compa-
ny on the due dates.

FHA Up-Front Mortgage Insurance Premium (UPMIP): For an FHA
loan, you will be required to pay 1.75% of the base loan amount.
This can either be paid at the closing or included in your loan.

Flood Insurance Research: Research is required to determine if
your house is in a flood zone. This fee covers the cost of the
research.

Home Inspection: It is strongly advised and mandated by almost
every lender that you inspect your house before closing. This
ensures that there are no major surprise repair costs after you
move in.

Home Owners Association Transfer Fees: If your home has a
homeowners association, you may be required to pay the dues at
closing.

Homeowners’ Insurance: This offers protection for your property.

Lender and Owner Title Insurance: This is insurance that protects
both the lender and the owner if there is a problem with the title.

Origination Fee: This covers the administrative cost of the lender.
It is typically about one percent of the loan.

Pest & hazzard Inspection: This is the fee for termites or related
infestation inspection.
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