Article

Service Members Save on Title and Closing Settlement Charges 

3 minute read

Doma is proud to be a part of the home buying process for service members, veterans and their families. We want to ensure that you know, as a VA buyer, certain fees will not be required in the title and escrow/closing process, saving you money. Below is an outline of costs you can expect. 

Typical Non-Recurring Costs 

  • Loan origination fee (1.0% x base loan amount) 
  • Appraisal fee (usually collected up front) 
  • Credit report fee (usually collected up front) 
  • Title examination and Title Insurance 
  • Flood certification fee 
  • Recording / endorsement fees 
  • VA compliance inspection fees as established by local VA office 
  • Discount points 
  • Energy efficient rating fee 
  • Survey fee 
  • VA funding fee (1.25% to 3.55%) 

Recurring Costs (Prepaid) 

Typically, the buyer is responsible for the lender and prepaid closing costs, except for costs not allowable under VA guidelines. The seller may cover some of the closing costs depending on the negotiated contract. 

  • Hazard / Fire Insurance premium (14 months) 
  • Flood insurance premium (14 months) 
  • Prepaid interest  (approximately 15-30 days) 
  • Taxes (amount varies depending on state and month; in California, we set aside an amount equaling approximately six months of taxes on the property) 

Non-Allowable Costs 

When the veteran pays the 1% loan origination fee, the veteran may not pay for fees associated with any of the following services or goods: 

  • Escrow, settlement or loan closing fees 
  • Notary fees 
  • Attorney’s services other than for title work 
  • Lender-related fees, including processing, loan document preparation, underwriting, photos, tax service application, commitment, trustee, TIL preparation, inspections, lender appraisals, postage, telephone. 
  • Real estate brokerage fees 

Inspections and Repairs 

The price paid for the property and whether the property is sold “as is” or is to be repaired is typically determined between the buyer and seller. They are free to renegotiate the terms and conditions of the sale even after the CRV/NOV (Certificate of Reasonable Value/Notice of Value) has been issued. 

However, if VA requires repairs to be made, the buyer and seller can negotiate who pays for the repairs subject to VA approval. VA’s interest in the property as security for the loan will be satisfied so long as either party pays for repairs. 

Buying a home? Get started with your local Doma team today local.doma.com