Can My Closing Costs Estimate Increase at Closing? ..

Can My Closing Costs Estimate Increase at Closing?

August 14th, 2011

Can my closing costs estimate increase at closing? On January 1, 2010, The GFE (Good Faith Estimate) 2010 became effective. Therefore, the costs that you are quoted in the GFE is a lock in closing cost. This change came about because many buyers would go to closing only to find figures completely different from what was quoted. In the GFE-2010, your cost may only change if the circumstances that were initially unverified change and subsequently is confirmed. Here are the breakdown of charges that cannot or can change at closing:

Charges that cannot increase:

1. Origination charges

2. Credit or charge for a specific interest rate chosen

3. Your adjusted origination charges

4. Transfer taxes (We have none in Texas)

Charges that cannot increase by more than 10%:
     1.     Government recording charges
     2.     Mortgage insurance premium
     3.     Appraisal fee
     4.     Credit report
     5.     Tax Service Fee
     6.     Title service and lender's title insurance
     7.     Owner's title insurance
     8.     Survey

Charges that can increase:
     1.       Initial deposit of your escrow account
     2.      Daily interest charges
     3.      Homeowner's insurance

Under the guidelines, the numbers of the Good Faith Estimate that the buyer was provided are compared with the final numbers of the HUD-1(Your final closing statement). If these numbers do not match up, or stay within above criteria, the lender is held personally responsible for the difference in cost. The lender is accountable for all fees not disclosed; therefore even if they underestimates the fees, the buyer won't be liable for that mistake.

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Disclaimer : The views and opinions expressed in this blog are those of the author and do not necessarily reflect the official policy or position of the Houston Association of REALTORS®

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