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Are the Loan Origination Fees on line 801 of my GFE negotiable? I know the max is 1%, and both GFEs that I have gotten are at that 1%. Money is a little tight these days, and I want to make sure I am not getting screwed out of any money.
Those fees are charged by your broker and yes, they are negotiable. Brokers make money from two basic streams... the rate and the fees. The difference between their buy rate and what they charge you is profit... and some of the fees they charge (origination for example) are profit too.
So, you need to look at the situation as a whole. One guy might give you 5.5% with a point origination fee... the other guy might give you 5.75% with no origination fee.
You need to compare BOTH sides of the equation to get the best deal. It's out of pocket VS Rate. A guy charging you a point in Origination Fee isn't necessarily ripping you off, and a guy charging you no fee isn't necessarily giving you a good deal.
Also, look at your GFE carefully... is one guy accounting for 6 months taxes up front and one guy accounting for 3? When you close will dictate the real number, but some brokers use three because the GFE will read with a lower number for money up front and make the deal appear more competitive.
Short answer though is, yes... you can negotiate the amount of profit a broker is willing to take...
Call another reputable broker and compare the basics... "I'm getting a quote of 5.75 with a 1 point orgination fee... can you do better?"
God YOU are so right but some people need to bring less cash to the table where higher rate comes into play but no origination fee. While some people have a little cash now and save on long term...A broker can charge lower rates but have 1% origination fee, possiblility of borrower bring cash to the table in closing... troutboyky
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