Posted on: 24th Aug, 2012 08:09 pm
What are the hidden costs of new mortgage deals and how to stay alert of them? I am planning to take out a mortgage by this year and lot of my acquaintances told me about hidden costs of new mortgage deals. Can someone please explain?
hi daisy,
any mortgage deal, whether new or a refinance, will include loan fees and closing costs. all the effort is made so that the costs and fees are disclosed to the mortgage applicant. but there are certain costs and fees which remain hidden and can surprise the borrower. if you're concerned about the hidden costs, then you should take a look at the taxes and insurance, the lender will ask you to go for a escrow account. the actual amount collected from you, however, will vary based on the time of year it is and the lender's requirements. so, you should keep a tab on the amount charged to you in the name of taxes and insurance.
thanks
any mortgage deal, whether new or a refinance, will include loan fees and closing costs. all the effort is made so that the costs and fees are disclosed to the mortgage applicant. but there are certain costs and fees which remain hidden and can surprise the borrower. if you're concerned about the hidden costs, then you should take a look at the taxes and insurance, the lender will ask you to go for a escrow account. the actual amount collected from you, however, will vary based on the time of year it is and the lender's requirements. so, you should keep a tab on the amount charged to you in the name of taxes and insurance.
thanks
Though a responsible lender is supposed to disclose all the costs associated in a mortgage, but in practice the entire spectrum of costs do not get reflected in that disclosure. The hhidden costs in a mortgage are not often taken into consideration by the homebuyers, especially the first time home buyers. These hidden costs such as mortgage arrangement fees,appraisal fees, valuation and survey fees etc often make a seemingly perfect mortgage purchase to a difficult one. Before, making the kill, make sure you have taken into consideration all these costs and kept aside a certain sum of money for this purpose.
Welcome Corin,
In order to avoid the hidden costs associated with the mortgage loans, you should always ask for a disclosure of the mortgage fees associated with the deal. Apart from that, you should also ask for clarification if you find that you are being charged excessively in the name of a certain fee. The lender is bound to give you clarifications. Apart from that, in order to be on the safe side, it will be better if you could read through the mortgage documents carefully.
In order to avoid the hidden costs associated with the mortgage loans, you should always ask for a disclosure of the mortgage fees associated with the deal. Apart from that, you should also ask for clarification if you find that you are being charged excessively in the name of a certain fee. The lender is bound to give you clarifications. Apart from that, in order to be on the safe side, it will be better if you could read through the mortgage documents carefully.
Hi Corin!
Welcome to forums!
Apart from what others have said, some of the other hidden costs include stamp duty, estate agent's costs, solicitor's costs, removal costs, surveyor's costs, etc. Though these costs won't affect your monthly budget once you've bought your new home, they do need building into your overall ‘moving home budget.'
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
Apart from what others have said, some of the other hidden costs include stamp duty, estate agent's costs, solicitor's costs, removal costs, surveyor's costs, etc. Though these costs won't affect your monthly budget once you've bought your new home, they do need building into your overall ‘moving home budget.'
Feel free to ask if you've further queries.
Sussane