Escrow - Charges for a neutral third party to hold the funds and documents that change hands during the home selling and buying process. An escrow officer sees that items in the purchase contract are carried out and appropriate parties are paid. The interest rate on this agreement stays the same for as long as the mortgage is held, no matter how interest rates change in the financial markets. With this type of mortgage, you know exactly how much you will pay in principal and interest on your home each month. Remember, taxes and insurance on your home may change from year to year.
Standard fees are title insurance, recording and survey fees.
There are also many variable fees, including application fee, points, appraisal and credit report fees, and closing fees. Homeowners Insurance - Insurance required by lenders to protect you against fire, and in some cases flood or hurricane. Most policies also protect the homeowner against theft and liability should someone be injured on the property. Index Rate - A numerical figure used in economics that describes relative changes in some quantity. Example is the consumer-price index.