What are junk fees?

Junk fees are extra charges a mortgage lender tacks on when you close on a home. Paying some closing costs when finalizing a mortgage is expected. However, certain charges are unnecessary or excessive.

Junk fees may be labeled as an application fee, a mortgage rate lock fee, a processing fee, a courier fee, an administrative fee, a documentation fee or something else entirely. While such fees may represent actual work that was done, they tend to be basic services that the lender is expected to provide.

If you think you’re being charged junk fees, press your lender for details. If you find that the fees are in fact unjustified, you could ask the lender to waive them or simply state that you’re unwilling to pay. When pressured, the lender is likely to reduce or eliminate these charges.