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Updated about 6 hours ago on . Most recent reply
Underwriting & Processing Fees - Hard Money Lenders
What are people experiencing for upfront fees on hard money right now? We've seen lenders charge nothing upfront apart from an appraisal fee (if its even applicable), and other lenders charge $2000+ for underwriting, processing, and other misc. fees prior to or out of closing on top of points.
Second, are people finding that these fees are charged prior to closing? Especially lenders that don't require appraisals, I can understand charging a fee upfront as a small commitment to not shop the deal.
Most Popular Reply
Hey Richard,
Fortunately there are plenty of HMLs that don't do any 'retainers' or 'due diligence' fees up front and would even only charge for the appraisal on the HUD. It really does vary by lender and it might not hurt to utilize a broker if you've experienced this a couple of times.
I would say that the points + $2000 is about right, but again, usually out of closing. I've seen the up-front due diligence on larger deals or more complex commercial work but not on your standard HML residential projects. Plenty of groups are more straightforward and can even have some unique quirks towards the payment schedule and other differentiating factors