This is last of a three-part series on Junk Fees. These are the extraneous fees that lenders and other parties to the closing process charge for various services associated with closing a transaction.

 Last week I explained how many of the Junk Fees are a way of offsetting costs that the lenders incur in processing your loan and making sure that it meets all the legal requirements and the standards of the agency to which they sell your loan. This is very important to them, because failure to meet these standards is VERY expensive to them. 

 What I object to as much as you do is when these fees start coming out of left field and just look like someone made them up. If you see costs other than the ones I discussed last week, ASK! Also, other charges do not bear any relation to the actual cost, like a $50 Courier Fee. We all know FedEx costs about $20. 

 As much as people get upset by them, Junk Fees are not going to go away, EVER. No lender is ever going NOT charge something to cover these costs that YOU made them incur by applying to them.  They have to get paid by someone, sometime, and it sure isn’t the flake whose loan was turned down. He didn’t pay anything for that, and, in fact, part of your fee covers the cost of turning his loan down. I see that as the offset for the fact that our industry will do a lot of work for FREE in anticipation of making something down the road.

 Bottom line, get your lender and Settlement Agent to disclose these fees early by asking for an Estimated Closing Statement way before closing. They are required by Federal law to give you one 5 days prior to closing, but you have to ask, or demand. That will give you time to study and ask for an explanation for each charge. I hope that you feel empowered to object strenuously to any that are unreasonable. Dig your heels in and I think you will be successful.

WARNING! A high-visibility national lender advertises loans for total fees of only $395. They have not found a way of doing it cheaper!! You are just paying for it some other way, some why you won’t figure out until it’s too late! It’s just a come-on, so don’t fall for it.