Think You Found a Better Mortgage

THINK YOU FOUND A BETTER MORTGAGE QUOTE? Think Again and Consider all Costs

Yvonne Mcfadden

Getting a mortgage is always a meticulous process that most buyers go through carefully and consider many options to ensure they get the best mortgage quotes to meet their needs. Many people tend to contact several lenders to compare mortgage quotes and see which one is better. Most home buyers tend to prefer a lower mortgage quote, which they feel is their best option. However, this is not always the case. Many mortgage lenders tend to leave out several costs when creating a mortgage quote, so the quote doesn’t seem all that scary and convince the homebuyer to go with them. This always works against them as most of these costs will not be waived whether the lender adds them to the mortgage quote or not. Although many lenders tend to leave out these costs, they will definitely apply, which might cause a problem for you in the future. This is why it is best to consider all costs before you choose the best mortgage quote, and below are some of the costs you should consider and look out for in a mortgage quote before you choose the best mortgage quote for you.

FINAL APPRAISAL FEE

Although appraisers carry out home appraisals on new constructions, the first appraisals are never carried out when the home is completely built. Therefore, the appraisal is termed subject to final completion, which requires the appraiser to return to carry out a final appraisal to ensure the house has been completed before closing. There’s a small cost for this final inspection and should be reflected in the fee worksheet. Whether a lender discloses this information on their worksheet or not doesn’t change the fact that they apply.

SUBDIVISION DUES

This is another fee that should reflect in the worksheet and, therefore, be added to the mortgage quote. It applies to newly-built homes in various areas and is usually stated in the sales contract. These costs apply whether a mortgage is obtained or the buyer chooses to pay with cash, and when a lender omits this cost, it gives buyers the wrong projection.

HOME INSPECTION

This is separate from the appraisal fee as lenders usually demand this fee so as to get an inspector to thoroughly check out the house and confirm that the prospective house to be bought is structurally sound and is completely livable. The figure to be paid usually depends on the location and the type of house being inspected.

CREDIT REPORT FEE

Another fee to check in your fee worksheet is the credit report fee. Lenders usually go through the process of procuring your credit report by themselves and use their defined risk analysis model to confirm if you’re creditworthy. The fee for this would be reflected in your mortgage quote and sometimes affect your interest rate.

DOCUMENT PROCESSING FEE

The loan estimate usually costs lenders time and money, and therefore, there is a charge for this. This fee usually includes administrative fees and several other costs. It varies according to lenders, and many times they are not set in stone. This means that the borrower could negotiate this fee, but there are times when the lender doesn’t separate the fee from the loan price and rather adds them together as one to make it nonnegotiable.

These are the main costs to look out for in a fee worksheet, and other fees include the real loan, title fees, the loan origination fee, which might be the largest fee you would be paying in the closing costs, and several more. Ensure that these fees are clearly stated in the mortgage quote, or you might end up getting an inaccurate mortgage quote and thinking it’s a better choice.

Reference

http://www.mortgagenewsdaily.com/channels/ community/931031.aspx https://www.creditkarma.com/home-loans/i/fees-whenbuying-home