Mortgage rates are the lowest they’ve been in a long time, and those people who are in a position to be able to capitalize on the market conditions and buy a home are facing another challenge: rising mortgage closing fees.
In Illinois alone last year, mortgage closing costs rose by 40%. The national average is 37%. Why the big jump? It has to do with new regulations on the mortgage industry that went into effect in January. Lenders are now required to provide much more accurate estimates of closing fees. If their estimates are not within 10% of the actuals, they are slapped with a fine. That means more time and labor going into preparing a loan, and bank being more honest. It also means fewer surprises for consumers in the end, but steeper fees. Either way, the result is not good.