Hit $3,200 in cash out refi closing costs and almost walked away

I was gonna cash out refi my place here in Phoenix to pay off some credit card debt. My lender quoted me $2,100 at the start for closing costs. Then when I got the final disclosure it jumped to $3,200. That's like 40% more than what they first said. The extra came from appraisal fees and some title insurance add-on they didn't mention upfront. I almost said forget it right there. But I ran the numbers and my new rate was still way lower than my current one plus I'd clear $18k in debt. So I pushed through but I'm still salty about it. Has anyone else had closing costs balloon like that at the last second?

2 comments

2 Comments

the_jordan4d ago

Hold on, I gotta push back a little. You say they didn't mention the title insurance add on, but don't you usually get that explained in the initial Loan Estimate? It's a standard thing. A $1,100 bump is annoying for sure, but it sounds like your lender gave you a rough quote early on that was too low. Better to be realistic than shocked. Unless this was something shady like a junk fee they snuck in last minute, the numbers still worked for you. Sounds like you made the right call anyway.

terryallen4d agoMost Upvoted

Title insurance is one of those things that shows up different depending on where you are. Some lenders roll it into the closing costs, others itemize it out later. The initial Loan Estimate can be vague on that stuff if you're not reading every single line. I've had deals where the estimate said "owner's title policy" at a flat rate, then the actual bill had a separate search and examination fee that added another 400 bucks. That's the part that gets people. As long as the overall APR and cash to close are close to what was quoted, it's not junk, just poor upfront disclosure. Sounds like your lender gave you a working number but missed the fine print details. You made the right call though, a thousand bucks is annoying but not a deal breaker if the rate was good.