A lender estimates the closing costs on a home loan of \$50,000 as listed below.
Closing CostCharge
Loan origination\$200
Title insurance\$530
Attorney's fees\$600
Appraisal\$265
Inspection\$575
Recording fees\$130
Escrow\$800
If the lender's good faith estimates are accurate, are they a reasonable amount for closing costs? Why or why not?
AYes, because the lender estimated 3.08\% of the home loan in closing costs which falls between 3-5\%.
BYes, because the lender estimated 4.6\% of the home loan in closing costs which does not fall between 3-5\%.
CNo, because the lender estimated 6.2\% of the home loan in closing costs which does not fall between 3-5\%.
DNo, because the lender estimated 17.7\% of the home loan in closing costs which does fall between 3-5\%.
Closing Cost | Charge |
Loan origination | \$200 |
Title insurance | \$530 |
Attorney's fees | \$600 |
Appraisal | \$265 |
Inspection | \$575 |
Recording fees | \$130 |
Escrow | \$800 |
AYes, because the lender estimated 3.08\% of the home loan in closing costs which falls between 3-5\%.
BYes, because the lender estimated 4.6\% of the home loan in closing costs which does not fall between 3-5\%.
CNo, because the lender estimated 6.2\% of the home loan in closing costs which does not fall between 3-5\%.
DNo, because the lender estimated 17.7\% of the home loan in closing costs which does fall between 3-5\%.