The application fee covers the lender’s (not mortgage broker) cost to process the information on your loan.

Usually, you must pay this charge at the time you file the application to for a mortgage. Some lenders may apply the cost of the application fee to certain closing costs.

Generally lenders do not refund this application fee if you are not approved for the loan or if you decide not to take the loan that you were offered.

This fee may or may not be separate from other fees such as home inspection, and appraisal costs and depending on the lender this application fee may or may not be returned upon successful closing of the loan.

Get more information on Application fee in the Real Estate Forum