NLIC.org

Teresa Said:

Did anyone use the Bank of America no fee motgage yet?

We Answered:

There are definitely costs involved in all mortgages regardless of how it is marketed to the consumer. Appraisals, credit reports, title insurance, etc. all come with fees.

What BofA is probably doing is charging a higher rate in return for not collecting the fees upfront. They could also be playing with the verbiage. Some lenders, such as Ditech, claim little to no "fees", but then charge outrageous "origination points". Is an origination charge a closing fee? Depends on who you ask.

When talking to Bof A, ask about points, origination fees, closing costs and prepaids (interest, insurance and tax deposits). Also make sure the loan does not contain a pre-payment penalty.

Get a Good Faith Estimate upfront and ask what the rate would be if you elected to pay the costs instead. That way you will get a true picture.

Also ask your Realtor or financial planner for a lender referral and get a couple quotes before you make application with anyone.

Best of luck to you!