HARP Refinancing Loan Costs Negotiable? Estimated Costs very HIGH (insurance, interest rate, escrow)

[mikePOM]

Hello all,

I would appreciate if you have any advice on this refinancing matter. I own a condo (Los Angeles, CA) that was originally an interest-only loan. Now I could qualify for the HARP government-sponsored program and fortunately qualify for an interest rate of 5%.

However, the closing costs worksheet that the Chase company gave me had high fees and points attached to it. Here is the following:

Loan Origination Fee: $0
Loan Discount Points: $3,400
Credit Report Fee: $10
Tax Service-Chase Home Finance LLC: $45
Application Fee: $365
Underwriting Fee: $295
Courier/Delivery/Messenger Fee: $50
Flood Certification: $11
Escrow Fee: $730
Sub Escrow Fee: $125
E-doc closing Fee: $125
Recording/Filing fee: $67


It seems like these fees are estimated by the branch manager and can be negotiated. The fees seem like the rate charged during the 2007-2008 period.

Please add your professional advice, thank you.

[Elke Mariotti]

Originally Posted by mikePOM

Hello all,

I would appreciate if you have any advice on this refinancing matter. I own a condo (Los Angeles, CA) that was originally an interest-only loan. Now I could qualify for the HARP government-sponsored program and fortunately qualify for an interest rate of 5%.

However, the closing costs worksheet that the Chase company gave me had high fees and points attached to it. .

See my comments in red:

Here is the following:

Loan Origination Fee: $0 Can't get lower than that
Loan Discount Points: $3,400 If you have a $340,000 loan, they're charging you a point or 1% - common
Credit Report Fee: $10 Standard - sometimes higher
Tax Service-Chase Home Finance LLC: $45 Sounds like a fee to verify current taxes - nominal
Application Fee: $365 Maybe negotiable, not uncommon
Underwriting Fee: $295 Maybe negotiable, not uncommon
Courier/Delivery/Messenger Fee: $50 Pretty standard, give or take a few dollars
Flood Certification: $11 Standard fee
Escrow Fee: $730 To make sure there's enough in escrow to make your upcoming RE taxes and HO insurance payments
Sub Escrow Fee: $125 New to me, but may be similar to above?
E-doc closing Fee: $125 Sounds like a substitute for a sit-down closing - cheaper than sit-down
Recording/Filing fee: $67 They have to record the new mortgage - costs money, so it's probably just a pass-through fee

Originally Posted by mikePOM

It seems like these fees are estimated by the branch manager and can be negotiated. The fees seem like the rate charged during the 2007-2008 period.

Please add your professional advice, thank you.

Bottom line: application fee and underwriting fee might be negotiable; possibly also the point they're charging. However, they do want to get paid for their work... Nobody works for free.

Always worth a try to negotiate

[mikePOM]

Thank you for the detailed info. Will call back and ask about the loan discount points.

Additional info that may be relevant or not: LTV is 110%, FICO score and asset not verified for the HARP refinancing program.

[ShanetheMortgageMan]

Instead of paying the $3,400 discount point, your alternative would be to take a slightly higher rate (usually the trade off is .25-.375% lower in rate for every 1% in points you pay).

[mikePOM]

Thank you Shane, I will bring that up during the appointment.