The floor, and the standard
The floor: before you have received a Loan Estimate and told the company you want to proceed, a lender or broker generally may not impose a fee on you at all. The single exception written into the rule is a bona fide and reasonable charge for obtaining your credit report.1
The standard: that exception is permission, not an obligation. Pulling credit is a cost of doing business, and plenty of shops absorb it rather than bill a borrower who has not been shown a single number yet. Nothing should come out of your pocket until an appraisal genuinely needs to be ordered.
We charge nothing to look at your file. No application fee, no credit report fee, no processing or underwriting fee to price a loan, pre-approve you or issue your Loan Estimate. The first money you spend is the appraisal, and we do not order one — on any loan type — until we know your loan is deliverable.
On a conventional, FHA or USDA file, that is the point at which you pay the appraiser. On a VA loan we cannot collect that fee from you up front at all.
The appraisal is the first thing worth paying for
An appraiser is an independent third party doing real work, and that work is not free. The question is when. Credit reviewed, income and assets understood, program and lender chosen, conditions known — then the appraisal, because at that point you are buying it for a loan that can actually close. Ordering it earlier means paying to appraise a house for a file nobody has vetted.
“Send the appraisal deposit and we’ll get your Loan Estimate out” has the sequence exactly backwards. The Loan Estimate comes first, it is free, and it is the document you shop with. Anyone treating it as something you buy is telling you how the rest of the file will go.1
Two more things worth knowing
Intent to proceed is something you say. A lender cannot infer it from your silence, and receiving a Loan Estimate is not accepting the loan.
A quote or worksheet is not a Loan Estimate. One prepared before the real disclosure has to say plainly that your actual rate, payment and costs could be higher.1
Sources
These references support the factual explanations above. Where this page states a preference rather than a fact, it says so — those are our editorial judgement, not a claim that any one channel always costs less.
Next
Which mortgage fees are worth questioning?Some closing costs buy a service. Others are overhead with a name on it.Start with a broker. Then vet the broker.The structural advantage is real. It is not automatic, and not every broker works it.The whole argument, in one place
Eighteen pages, including the printable checklist to take to every lender you talk to. Nothing to fill in, no email required.