We recently introduced our OneFee Plus Program. The creation of this program has been a long time dream of mine. I started this business because I was going for a loan on my first home and the lender I was working with tried to take advantage of me. he was charging 2 points in broker fees, about $1,000 in junk fees and he was getting another 2 points in yield spread premium (which has a direct result on my rate) My loan was going to be on a house costing $150,000. Which means he was going to earn $7,000 in fees off of my loan.
The worse thing was this loan officer was extremely busy. he probably did 20 - 30 similar loans per month. Now I'm all for capitalism but there is no need to take advantage of people.
Since I've been in the business it has been my goal to reduce costs and fees to as low an amount as possible. My first job was with McDonald's and I have always been a fan of Wal-Mart. These two companies have one thing in common. They have mastered efficiencies in their respective businesses. I knew that to lower customer costs in the mortgage business I too had to improve efficiencies.
Now, after years in the business I am able to do just that. Effective Immediately I will do all of my loans for a Flat TOTAL Fee of $1,595 plus a lender paid yield spread premium of .25%.
Unless you are in the mortgage business or understand how lenders, brokers, and loan originators get paid this may not seem like a big deal. To help you get a better picture of how people in my business get paid I have created an article below that explains it all. If you have a settlement statement from a previous loan you will be able to see what you have been charged in the past.
To fully disclose who we are and how we operate www.YourMortgageDoctor.com is set up and allowed to get paid as a lender and a mortgage broker, And although we can take some advantages that lenders have we consciously choose not to.
Mortgage brokers, originators, lenders, and loan officers almost always get paid on a commission basis. We receive compensation in one of several ways
Origination Fee - (Sometimes labeled as points, mortgage broker fees, and or various other "junk fees") This fee is typically 1%-3% for most loan originators. This is a percentage of your total loan amount.
Yield Spread Premium - (This fee can sometimes be labeled as "YSP", Rebate paid by lender, Back end fees, Lender paid fees) The tricky things about these fees are as follows
Anybody doing a loan that is a lender or works for a lender (eg Loan originator and Loan Officer) or "Uses their own money" are not required by law to disclose this fee at anytime during the loan process, including at the settlement table. This means you as the consumer will never see how much the "lender" really makes on your loan
This "Hidden" Fee can range from .5% to almost 4% of the loan amount and is a fee that is "Earned" by the "lender" The higher this fee is the higher your rate. Our OneFee Plus program always quote a YSP of .25%
Mortgage Brokers are required by federal law to disclose an estimate on your initial good faith estimate how much they expect the the "YSP" to be. may will put in a range of 0% - 3% meaning they can go up to 3% if they wanted to.
Service Release Premium - (This fee is always hidden by the lender and not even available to a broker) A lender will get extra fee (Typically 1%) for closing a loan in their own name.
Junk Fees - Many lenders, loan officers, loan originators and mortgage brokers will put in "Junk Fees" that can add up to several hundred dollars. The only fees a loan originator should charge is a Loan origination fee and/or mortgage broker fee they will also have a fee for loan processing as most efficient lenders use outside services to process loans. All other fees charged by the loan originator such as Credit reports, Application, Commitment fee, Overnight fees, Paperwork fee, Copying fee etc. should not be charged, If they want to charge you for items they should just add these fees to the origination or broker fee and stop trying to hide them More on YSP and Service Release premiums
Many lenders will say that they sell the loan to a lender and the lender is the one that pays their fees, that is true to some extent, but as I will explain you will see that it is still you paying for this rebate.
The Yield Spread premium and the Service Release premium is very important to you because the amount paid to the loan originator on these items absolutely and directly affects the rate that the originator "SOLD" to you, yes they sold you a rate of 6.5% which you thought was acceptable. (Most customers don't realize the negotiation ability they have with a rate) I will show you below exactly how much that "originators" selling job has cost you. The service release premium is a fee that only lenders who close in their own name get but it works on the same principle.
The yield spread premium changes based on the rate that the originator "sold" to you. The higher rate he or she sells you the more money they make. It is very hard for most loan originators to keep your best interest in mind when their compensation is based on how high they can push your rate.
Our OneFee Plus program is the best deal you will find. In order to take advantage of this deal you must be aware of the following
The $1,595 is our fee for doing your loan it does not include other closing costs as determined by other 3rd party companies.
1 tri merge credit report is included in the OneFee
Our Overnight delivery fees to the lender are included in the OneFee
Appraisal Fees, Appraisal reviews, surveys, condo questionnaire request, misc fees charged by your banks or employers to verify loan information are not included and will be paid for by you upfront or if allowed added to your settlement statement.
Processing fee of $495 for 1st mortgage and $225 for 2nd mortgage (if applicable) is separately charged.
Any other fees generated by any third parties are not our responsibility, We would suggest working with your third party providers to see if they can reduce their fees
Important Fine Print
We of course cannot control the fees of third party providers and cannot guarantee their share of the closing costs
