Services You Need for Your Home Loan
February 11, 2024
What do first-time homebuyers need to remember about buying a home with an FHA mortgage?
Among the issues you’ll want to research in the early days of your house hunting journey, one important thing to remember is that the services you need to get to closing day are not centralized.
They may require additional research time to ensure you are getting the right things you need to get into your dream home.
Home Loan Services: Brokers and Agents
A mortgage broker provides a service to those unsure about who to choose for a home loan. The broker can match you with a lender willing to work with you and your current circumstances. You don’t need to use one.
You can search for your own lender without third-party help. But if you’ve never looked for a home, this service could help you get started.
A real estate agent is another third-party option you can use, but the agent’s focus in this case is helping you find the right house to buy.
Appraisals and Inspections
No matter how often your lender or seller refers to the appraisal process as an inspection, you’ll want to remember that the appraisal is a tool for the lender and is separately charged from a home inspection, which is a tool for the borrower.
Do NOT rely on the results of the appraisal. They are NOT as detailed or observant as the home inspector’s work and the two processes are not identical.
Expect to pay for these two costs separately and have the services given by separate providers.
Your Legal Fees and the Lender’s Legal Fees
FHA loan rules forbid the lender from passing on their legal fees (for bank-initiated services) to you.
But you WILL have to pay any legal fees for services you require as a borrower such as having a real estate lawyer review your purchase contract before you sign. Expect to pay your own lawyer fees but not those of the lender.
Pest Inspections
If an FHA appraiser notes evidence of wood-destroying pests, an inspection and/or pest control measures must be paid for. You may be able to negotiate those costs with the seller, but it’s smart to anticipate having to pay these yourself.
Flood Zone Determination
Is your home in a known flood zone? Is it in a suspected flood zone? Your lender may require a flood zone determination, and this is an expense the borrower typically pays.
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RELATED VIDEOS:
There's a Difference Between APR and Interest Rates
Choose Your Mortgage Lender Carefully
Getting Started With Your FHA Loan Application
Among the issues you’ll want to research in the early days of your house hunting journey, one important thing to remember is that the services you need to get to closing day are not centralized.
They may require additional research time to ensure you are getting the right things you need to get into your dream home.
Home Loan Services: Brokers and Agents
A mortgage broker provides a service to those unsure about who to choose for a home loan. The broker can match you with a lender willing to work with you and your current circumstances. You don’t need to use one.
You can search for your own lender without third-party help. But if you’ve never looked for a home, this service could help you get started.
A real estate agent is another third-party option you can use, but the agent’s focus in this case is helping you find the right house to buy.
Appraisals and Inspections
No matter how often your lender or seller refers to the appraisal process as an inspection, you’ll want to remember that the appraisal is a tool for the lender and is separately charged from a home inspection, which is a tool for the borrower.
Do NOT rely on the results of the appraisal. They are NOT as detailed or observant as the home inspector’s work and the two processes are not identical.
Expect to pay for these two costs separately and have the services given by separate providers.
Your Legal Fees and the Lender’s Legal Fees
FHA loan rules forbid the lender from passing on their legal fees (for bank-initiated services) to you.
But you WILL have to pay any legal fees for services you require as a borrower such as having a real estate lawyer review your purchase contract before you sign. Expect to pay your own lawyer fees but not those of the lender.
Pest Inspections
If an FHA appraiser notes evidence of wood-destroying pests, an inspection and/or pest control measures must be paid for. You may be able to negotiate those costs with the seller, but it’s smart to anticipate having to pay these yourself.
Flood Zone Determination
Is your home in a known flood zone? Is it in a suspected flood zone? Your lender may require a flood zone determination, and this is an expense the borrower typically pays.
------------------------------
RELATED VIDEOS:
There's a Difference Between APR and Interest Rates
Choose Your Mortgage Lender Carefully
Getting Started With Your FHA Loan Application
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