The rise in mortgage fees has been gaining a lot of attention lately but a recent analysis conducted by First American shows that title and settlement fees are still less than 1% of a borrower’s total life-of-loan costs.
Titled “Missing the Forest for the Fees – An Analysis of the Regressivity and Closing Cost Significance of Title and Settlement Fees,” the research points out the inaccurate conclusion drawn from Fannie Mae’s 2021 study of borrower life-of-loan costs, and details the more accurate differences in various costs over the life of a mortgage from Fannie Mae’s own updated research in 2022.
“With affordability at historic lows and the prospect of homeownership seemingly out of reach for low- and moderate-income families, it’s critical to evaluate the borrower’s total life-of-loan costs,” says Mark Fleming, chief economist at First American and author of the study. “Importantly, Fannie Mae’s own research finds that title and settlement fees are neither regressive nor a significant component.”