Perhaps Those Fees Weren’t for ‘Junk’

In Robert Bruss’ Dec. 28 “Real Estate Q&A;” column, there was a question regarding “junk fees” charged by a mortgage broker and other fees that were added by the actual lender at closing.

The borrower had received a “good-faith estimate” that did not include the lender fees, and the question arose if the added fees were legal. Bruss said that they were not and gave the advice to sue.

I hope the borrower did not follow this advice. One of the fees that was mentioned was the recording fee. This is not a lender fee and is charged by the county recorder’s office to record the deed to the property.

The other “junk fees” are not pure profit to the lender, as Bruss indicated. The broker had charged the 1% origination, and the costs that the lender incurs for underwriting the loan, drawing the documents and using the warehouse line to fund the loan must be recovered.

Second, the good-faith estimate is just that, an estimate of fees disclosed in good faith to the borrower. The good-faith estimate states that “these figures are only estimates and the actual charges due at settlement may be different. You may be required to pay other additional amounts at settlement.”

The only injustice here is that the broker did not know his lender well enough to include its standard fees. Or perhaps he did not know which lender he would send the loan to because he would have to do some shopping to get the best rates for his client.

I hope Bruss will think twice before advising someone to sue over something that is not illegal.

DEANN LEWIS

San Dimas

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I always find it very frustrating to read Robert Bruss’ advice on ways to reduce fees for purchasing a home.

He always informs the consumer that when buying a house, they can negotiate with loan broker fees, escrow fees and title insurance fees. However, he always forgets to mention real estate agent fees.

If he is going to speak of negotiating fees, he should mention all fees. Not just the ones that do not include him. From now on, any time Bruss answers questions regarding loan, title and escrow fees, he should be compelled to always state: “I am a real estate agent and you can’t touch my fees.” This way he will lose some of his so-called credibility.

BRIAN DIEDERICH

Torrance

Editor’s note: While Robert Bruss is a licensed California real estate broker, he buys and sells property only for himself and does not represent others.