No one wants to buy a lemon of a home, making a several hundred thousand dollar mistake. The majority of home buyers purchase a home inspection. But have you considered a ‘loan inspection’?
A home inspection functions as an independent third party service. A home inspector is unbiased, impartial, and checks the quality of your house before you buy. This is to ensure that major aspects of the home are in good condition and working order prior to purchase. Home inspections often include the roof, electrical, hot water heater, air conditioning and heating systems, major appliances, potential mold issues, exterior and interior damage… the list goes on and on. It is very wise to pay the few hundred dollars prior to signing on the dotted line; avoiding a several hundred thousand dollar mistake of buying a bad home.
Just like the home inspector checks the quality of the house, a ‘loan inspector’ (or loan review) checks the quality of a mortgage. Potentially saving home buyers from the catastrophe of overpaying by tens if not hundreds of thousands of dollars. A loan review provides an easy to read report on where any ‘damage’ on the proposed mortgage may be. This can help lower your monthly payments by a few hundred dollars. A loan review will check the fairness of your interest rate, origination charges and fees, points, credits, and annual percentage rate.
You can negotiate with your lender
A home inspection report is essential when negotiating the price of the home with the seller, especially for surprise findings. If the roof needs replacing and will cost 20 thousand dollars, the price of the home should reflect this or it is negotiated that the owners fix it prior to selling. If the sellers won’t budge, then you have a decision to make, either accept the house as is, or look elsewhere for a different home. A loan review operates in a similar manner. You can negotiate with the bank if there is any ‘damage’ found on your proposed mortgage. If the bank refuses to budge, you can either accept the mortgage as is, or find a more reasonable lender with what you now know to be fair.
Do it yourself
If you are the handyman type then doing your own inspection on your home may be an option. Of course there is always the possibility of missing something or not being skilled in a specialized area, which left unchecked could be a costly mistake. When it comes to mortgages there is greater complexity. Without a set standard of comparison, even senior bankers will not know for sure what the best interest rate is. The only way to know if your mortgage is fair is with an independent Mortgage Review.
Researching online with comparison tools are frivolous at best as they cannot review what actually matters, your 3-page Loan Estimate. Often any mortgage comparison is anything but unbiased. Rather the websites function as lead captures drawing consumers in with best case scenario teaser rates. Every person obtaining a mortgage should become familiar with the 3-page Loan Estimate. It is the banks guarantee to deliver on their offer and contains all the numbers regarding your mortgage, not just the interest rate. The interest rate is only one aspect of the mortgage, the points and fees are another; usually accounting for thousands of dollars.
A home inspector doesn’t sell you a home any more than a Mortgage Review sells you a mortgage. It works in your favor by empowering you as a consumer to be in the drivers seat when dealing with the banks.