in texas buying a home on the contract to present offer what does the not to exceed 1% loan origination fee mean? I don’t understand.
By: mamma
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By: mamma
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February 8th, 2008 at 4:09 am
buying home
Assuming you are looking at the “Third Party Financing Condition Addendum”, the statement is “…not to exceed ‘1%’ of the loan”.
This means that when the buyer applies for the loan, the fee he is being charged by the mortgage broker for doing the loan is not to exceed 1% of the loan value. The loan origination fee is how the mortgage broker makes their money.
For most loans involving buyers with good credit scores who are dealing with a reputable lender, this number usually does not exceed 1% and sometimes is lower. The higher loan origination fees are usually seen where the buyer is paying a higher interest rate because of their credit.
Email me if you have any questions.