What can an application packet reveal about a lender?

About application packets

After you apply for a mortgage, you will often receive a packet in the mail from the lender. The packet will include a copy of your mortgage application and information brochures that are designed to assist you through the mortgage application process.

If your lender sends you a copy of a mortgage loan glossary, be sure to take the time to peruse this particular piece of information.

You can learn a lot about a lender based on some of the information within the glossary. For example, if a lender does not include so-called “junk fees” in their loans, they may still define these fees within the glossary and specify that they do not charge these fees. A junk fee is a fee associated with the application, closing, or the servicing of the loan which is not considered necessary and is mostly profit for the lender.

If your lender has a glossary packed with these types terms and an accompanying definition of why the fees are necessary, you may want to look for a different lender. Get familiar with how each potential lender defines important terms and be certain that you are not going to assume greater costs with one lender over another.