Closing Costs for FHA Mortgages

From: HUD USER News
 
On Friday, May 23, 2008, HUD's Office of Policy
Development & Research released a report by Susan
Woodward and the Urban Institute entitled A Study of
Closing Costs for FHA Mortgages. This study presents
findings on how much borrowers pay in closing costs when
they buy a house, how much these costs vary, and factors
to which the variation is related.
 
The analysis uses data from a national sample of 7,560
FHA-insured, 30-year fixed-rate home purchase loans.
Data were collected on how much borrowers paid for
lender or broker services, title services, and real
estate agent's services, and were then linked to
information on borrower and loan characteristics
(including loan amounts, interest rates, credit history,
income, borrowers' race and ethnicity, and the racial
composition and educational attainment in the borrower's
neighborhood). The analysis focuses, in turn, on fees
paid to lenders and mortgage brokers, to title
companies, and to real estate agents.
 
This is the first study of its kind to include a very
large nationwide random sample of loans. Considerable
effort was required on the part of the Urban Institute
to develop the database from the HUD-1 settlement
statements in the case binders of the sampled FHA loans
because of the lack of standardization in the way fees
are entered and labeled by mortgage lenders, brokers,
and settlement agents.
 
The report is available for download at
 www.huduser.gov/portal/publications/hsgfin/fha_closing_cost.html.
 
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