What Are the Closing Costs on a Reverse Mortgage?
What are Reverse Mortgage Closing Costs?
The closing costs for a reverse mortgage are dependent on the type of reverse mortgage loan chosen, the lender chosen and the money taken out upfront. Below find a list and brief explanation of typical fees at closing:
Loan origination fee covers the processing of the new application and compensates for completing the sale. The fee usually is a percentage charge of the loan amount, typically 0.5% to 1.0%. If your loan is for $200,000, you’d pay $1,000 or $2,000.
Lender fee compensates the lender for administering the loan and overseeing the taxes and insurance.
Title insurance covers the buyer and the lender from possible ownership disputes,
Recording fee covers the mortgage lien recorded with the county clerk.
Credit Report fee covers the fees for checking for any liens or judgements.
Flood Certification fee covers charges for confirming if property is in a flood zone.
Preparation Fee for Documents covers fees for the preparation of closing documents.
Escrow and closing fee covers for closing services.