Mortgages are expensive, so if you have the opportunity to get your application fee refunded, you should jump at the chance. If you don't get approved or if you withdraw after the lender has gone through considerable time and expense, you're likely out of luck. However, if you follow through and meet the bank's criteria, there may be situations in which the bank is willing to refund the application fee.
Read your application and initial disclosure documents carefully. Look for the circumstances under which an application fee is refundable. For example, a bank may collect the fee to cover expenses in case a loan is declined, but will refund the fee if the loan is approved and you move forward.
Verify if there is a window in which you can cancel your application and receive a refund. If you cancel within three days, for example, not much work may have been done, making the bank more amenable to refunding the fee.
Make a formal request in writing to waive the fee. Cite the reasons you feel that you are entitled to a refund. For example, perhaps you paid to lock in a rate but the rate did not change, or perhaps the bank’s appraisal came in too low.
Mention mitigating factors if the bank’s typical policy is to not refund application fees. For example, if you’ve been a long-time customer with several loans and high deposits, request the waiver as a courtesy. Also mention if you have strong repayment history free of delinquency.
Note any ways in which the lender failed to live up to its advertisement. A common example would be not giving you the rate published the day you applied, even if you paid a lock-in fee. However, this is not a very common occurrence as banks are highly regulated to protect against these types of situations. Even so, human error can occur.
Carl Carabelli has been writing in various capacities for more than 15 years. He has utilized his creative writing skills to enhance his other ventures such as financial analysis, copywriting and contributing various articles and opinion pieces. Carabelli earned a bachelor's degree in communications from Seton Hall and has worked in banking, notably commercial lending, since 2001.