Once a bank receives a loan application, it will arrange for an appraisal of the U.S. property and review the applicant's credit history to assess their repayment capacity. While the entire process is handled internally by the bank, the incurred costs will be itemized, including bank processing fees, property appraisal fees, flood zone certification fees, credit report fees, and tax service fees.
Bank Application Fee:
Bank application or processing fees are charged by individual banks and vary in price, typically ranging from approximately $1,300 to $1,600. The bank application fee is independent of the loan amount.
Property Appraisal Fee:
The purchase price of a home does not represent its actual appraised value. When approving a loan, the bank will engage a professional agency to assess the property's value. Appraisal fees generally range from $400 to $600. The appraisal fee is primarily related to the size and structure of the property, rather than the purchase price.
Credit Report Fee:
To evaluate the applicant's repayment capacity, the bank will review the applicant's credit scores and history from the three major credit reporting agencies (Equifax, Experian, and TransUnion). There are usually differences in the credit scores provided by the three agencies, and the bank will typically use the median value. The fee for checking credit reports is approximately $60.
Title-Related Fees
Once the applicant's repayment capacity has been verified and meets the requirements, the bank will notify the applicant to select a title company to verify the property title. If the property title is confirmed to be clear, the bank will require the applicant to purchase title insurance. The cost for this is approximately $2,200. Since both title insurance and homeowners insurance are related to the property price and are determined by market conditions, the costs may vary significantly.