A lender estimates the closing costs on a home loan of $50,000 as listed below. If the lender's good faith estimates are accurate, are they a reasonable amount for closing costs? Why or why not?

They are not a reasonable amount since the total estimated costs were $3,100 which represents 6.2% of the total mortgage loan. That number is way too high, usually closing costs are between 3-5% maximum of the mortgage loan.

Explanation:

Closing Cost Charge

Loan origination $200

Title insurance $530

Attorney's fees $600

Appraisal $265

Inspection $575

Recording fees $130

Escrow $800

total closing costs estimated by the lender = $3,100 which represent 6.2% of the mortgage loan