Home equity loan fees and costs

Home equity loan - fees and other costs

Many of the costs that come with a line of credit or term home equity loan are similar to the ones you pay when you buy a home. They can include:

Closing costs, which may include attorney fees, a title search to verify your ownership of the home, mortgage preparation and filing, and insurance fees.
Estimate 2 percent to 5 percent of the loan for closing costs.
A fee for a property appraisal, which estimates the fair market value of your home. This is sometimes part of your closing cost.
An application fee that covers the cost of processing the loan. This is not always refundable if you are denied credit.
Points, which are service fees figured on the total amount of the loan or credit line and usually paid at closing. One point equals 1 percent of the loan. For a $30,000 loan or line of credit, one point would equal $300.
Annual maintenance fees that can go as high as $100.
Transaction fees each time you make a withdrawal from your credit line
Cancellation fee. If you pay off the loan early, you may be required to pay this fee.
Inactivity fee. Borrowers who don't use their line of credit during a given period of time might be charged.