For homeowners or homebuyers

A Guide to Rate Fees

The average first-time buyer overpays by $6,905 in hidden mortgage fees. Our guide shows you where they are and how to fight them..

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How Lenders Hide Fees

First, stop focusing only on the interest rate. That’s where lenders want your attention. Your real savings are found by fighting the fees they hide in the fine print.

Go to Page 2 of your Loan Estimate, in the section for loan costs. Every fee described as “points,” “lender credits,” or “rate lock costs” is a place where they can inflate your expenses. They hope you’ll find it too complicated and just accept them as standard costs. They are not.

Understanding these fees doesn’t require a financial background. It just requires knowing where to look and what questions to ask. This guide will makes you the expert.

Read this before you lock your loan

A mortgage determines more than your monthly payment. It dictates whether your home is a safe asset or a financial drain. Here’s what separates the two.

Don’t Start Here

Stop Googling mortgage rates. It’s a trap set by lenders. Their real profit is hidden in fees, and our guide shows you exactly where to find them.

Your Dream, Not Theirs

You want the yard for the dog. The lender wants the profit in your loan. This guide protects your dream from their fees.

Asset or Financial Drain

A bad loan turns your biggest investment into a financial drain. It starts with hidden fees, and it undermines your financial foundation from day one.

The Insider’s Toolkit

This guide gives you word-for-word scripts and checklists from a former mortgage executive. Stop guessing and start negotiating with the confidence of an insider.

The Playbook Lenders Don’t Want You to Have

Master the Conversation

We give you the exact, word-for-word scripts to challenge questionable fees. Walk into any negotiation with the confidence of knowing what to say, how to say it, and when to walk away.

Force Total Transparency

This guide arms you with a list of non-negotiable questions that cut through the jargon. Make lenders explain every charge and prove your loan is free of hidden costs.

Compare Offers Like an Expert

Use our checklist to compare Loan Estimates from multiple lenders side-by-side. You will be able to spot junk fees and easily identify the best financial offer.

Close Your Loan with Zero Regrets

This guide was created by a former mortgage executive to level the playing field. Arm yourself with their knowledge and get the peace of mind that you secured the best deal possible.

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Estimate Your Possibilities

Use our calculators to explore numbers and understand what might work for you.

See My Matches

Frequently asked questions.

Lenders have a predictable playbook for padding their profits. Here are the most common tactics they use and how you can spot them.

What it is: This is a charge listed in Section A of your Loan Estimate. Lenders often describe it as a standard fee for creating the loan. In reality, it is 100% negotiable lender profit.

Why it’s a problem: Because it sounds official, most buyers never question it. This single line item can cost you thousands of dollars that go directly into the lender’s pocket.

Tip: When comparing loan offers, compare the total of all fees in Section A. Tell the lender with the highest total that you need them to match the lower offer from their competitor. This is the single most effective way to lower your closing costs.

What it is: These are separate line items, also in Section A, for supposedly different services. “Processing” is collecting your documents, and “underwriting” is approving them. Often, these are just two names for the same core service.

Why it’s a problem: It allows a lender to “double-dip,” making their fee structure look more detailed and legitimate while simply charging you twice for the same administrative function.

Tip: Ask the loan officer to provide a line-by-line explanation of what makes the processing fee different from the underwriting fee. The hesitation in their answer will often tell you everything you need to know.

What it is: Your interest rate is “locked” for a specific period, usually 30 days. Real estate closings are frequently delayed. If your lock expires, the lender will charge you a “rate lock extension fee” to keep your rate.

Why it’s a problem: Lenders are incentivized to blame delays on you or any other party, justifying the fee. This fee can be hundreds or even thousands of dollars for a 15-day extension, payable at the last minute when you have no other options.

Tip: Always ask for a 45-day or 60-day rate lock upfront. The small initial cost, if any, is far cheaper than a surprise extension fee. Also, ask for the lender’s extension policy in writing before you commit.

What it is: Lenders offer to “buy down” your interest rate if you pay an upfront fee called “points.” One point costs 1% of the loan amount.

Why it’s a problem: It’s often a terrible deal. You’re prepaying thousands of dollars in interest. Most homeowners sell or refinance long before they hit the “break-even” point where the lower monthly payment has paid them back for the upfront cost. The lender keeps your cash.

Tip: Always insist on seeing a quote with zero points. This shows you the lender’s real, baseline interest rate and allows you to make a clear-headed decision about whether paying points is actually worth it.

What it is: An escrow account is where you prepay your property taxes and homeowners insurance along with your mortgage payment. Lenders offer to let you “waive” escrow and pay those bills yourself—for a fee.

Why it’s a problem: The fee is pure profit for the lender. It’s often 0.25% of the loan amount ($1,000 on a $400,000 loan) for the “privilege” of paying your own bills. The fact that many competitive lenders and credit unions have eliminated this fee proves it is unnecessary.

Tip: Ask the lender what their escrow waiver fee is, both as a percentage and a dollar amount. If they charge one, know that you can likely find another lender who doesn’t.

What it is: This is the eye-catchingly low interest rate you see in a large online ad or on an official-looking mailer. Lenders use this “teaser” rate as a hook or bait, with the sole purpose of getting you to call and enter their sales funnel.

Why it’s a problem: That advertised rate is a fantasy for the vast majority of people. It typically requires a perfect credit score (740+), a large down payment, and, most importantly, requires you to pay thousands of dollars in upfront “discount points” to buy down the rate. It’s a lead-generation gimmick that gets you emotionally invested with a lender based on a rate that was never truly available to you.

Tip: Ignore the advertisement. When you speak to a loan officer, your first question should be, “Give me a quote with zero points”. This forces them to show you a real, comparable rate without the hidden costs. You should also ask, “What credit score, LTV, and points are needed for that advertised rate?” to expose the unrealistic assumptions behind the ad.

Get the Complete Playbook

These are just six of the two dozen traps we expose in the full guide. Get the complete playbook and arm yourself against every lender tactic

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