Understanding the Final Settlement Statement on Your Next Home Purchase or Refinance
Thanks to the government stepping in and changing what was once a relatively easy form to understand to one that requires a PhD in calculus you'll probably find the Final Settlement Statement very confusing!
One of the most difficult parts is that, let's say you go through a mortgage broker and they get paid $5,000 BY THE LENDER, then that $5,000 appears to be charge to you!
Actually, it is not a charge because you are then given it back as a credit. Sounds simple enough but on a no-cost loan where you are already getting lender credits it gets confusing because the credits are all lumped together.
The easiest way to figure it out is not to focus on the erroneous "charge" but to highlight all the non-recurring closing costs and the cost mentioned above and then highlight all the credits. When you take one from the other you will have your total closing costs (if any). On a no-cost loan this number should obviously be zero. Don't forget to take into account the cost for the appraisal which you may have paid for outside escrow.
If you have any questions regarding California home purchase or refinance mortgages please call me at (925) 951.8896