What is a No-Fee Mortgage?

A no-fee mortgage is a type of mortgage that does not require you to pay anything for closing costs when you close. Here are the basics of the no-fee mortgage and how it works. 

No-Fee Mortgage

A no-fee mortgage is sometimes offered by mortgage companies and lenders in an attempt to gain business. With this type of product, the lender is actually going to pay all of the closing costs on your loan for you. This means that you will not have to come up with any money for the appraisal fee, origination fees, discount points, or anything else that you can think of.

Compared to No-Cash Mortgage

This type of mortgage is often confused with a no-cash mortgage. With a no-cash mortgage, you are still going to have to pay for all of the closing costs. However, this simply means that you are not going to have to come up with any cash out of your pocket. The lender is instead going to roll the costs for closing into the amount that they are lending you. This means that you are essentially going to be borrowing more money and paying interest on the closing costs for the next 30 years.