The processing fees of a home loans in Texas are part of an important cost list when you need a loan to buy a house or apartment. This is one of the elements to be studied in a comparative study of different financing offers, even if this is not the most important point. Discover all you need to know about the cost of a real estate loan: how much does it cost in general? When to pay and to whom? How to negotiate a reduction or even a cancellation of these fees? And the home loans in Texas helped? What if I go through a real estate broker? All answers to these questions are provided below.
Fees to pay for your mortgage loan
When you make a mortgage, you will have to pay a few things. Not only will you have to pay interest each month that will be calculated based on your outstanding principal and interest rate. But in addition, you will have to pay for the following:
- A death disability insurance for this loan.
- A credit guarantee.
- Interim interest in financing for new housing.
This is the last point we will discuss in this article. The processing fees of a real estate financing can represent several hundred euros. They are usually calculated based on the amount of your loan with a minimum amount and a maximum amount. We often talk about an order of magnitude of 1% of the borrowed amount (more often of a range between 0.5 and 1.5%). For example, € 1,500 for a real estate loan of € 150,000.
But that remains only a sequence of ideas of the amount of this cost. Each bank has its own functioning in terms of file fees for a loan. Just as each bank has its own interest rate policy.
These fees are used to finance all the administrative treatment of your mortgage: the search for the best financing to offer you, the study of your income, your expenses and calculation of the risk of non-repayment, the loan setup, its day-to-day management during the repayment phase, etc.
When do you have to pay these fees?
For your real estate loan need, you will probably make several loan offer requests by going to different banks. You can then compare different proposals and choose the one that suits you best.
Do not worry, you can solicit as many banks or credit agencies as you want. You will only pay a processing fee to the bank with which you will sign your contract. There is no demand for money to pay for the time spent doing a loan simulation and educating yourself about your project.
The payment of this charge cannot be incorporated into the loan amount. This means that you will have to pay it right from the start of your mortgage. It is therefore necessary to provide this sum in your personal contribution. This is one of the many costs of a property purchase, some of which are to be paid from the beginning (bank fees, notary and agency fees mainly), others will be paid throughout the conservation of your FIFA 2018 Goal video Highlights Download
In addition, you also have the option of using a real estate broker. We will return below to this case and the treatment of these fees in this case.
Ability to negotiate deletion or reduction
Everything is negotiable. If you have a good financing record, you will have more leeway to negotiate the different elements of your real estate financing. Whether it’s the interest rate, the borrower insurance rate, the modularity of the repayments, the prepayment fees or the fees, you can negotiate different things.
It’s up to you to determine what you think is most important to negotiate with the banks. While the rate of your loan is one of the things that matter a lot, but it’s far from the only one. Personally, before negotiating a reduction of your file fees, I prefer to work on other elements. Now, when your funding does not present any particular constraints, you have a good chance of getting a discount simply by asking for it. Highlight the qualities of your file (see our 15 tips to improve your mortgage loan).
After between two very similar loan offers, this may make the difference between 2 banks, especially if you’re personal contribution is limited.
It is even possible sometimes to have these fees removed entirely. Either because you have a very good profile, or because the bank finds its interest elsewhere. Some banks have periods of promotion where they offer the file fees (or does not practice fees as is the case of La Banquo Postal, subsidiary of La Poste).
Nevertheless, some funding agencies are very attached to these fees because it allows them to get money back quickly. In particular to finance the salaries of the administrative, legal, etc. staff. who worked on your file. It may be easier to negotiate on other points of your financing. It’s up to you to test this during your interview for a loan simulation and to see on which points the bank is ready to make efforts and on those for which it will be difficult to obtain a commercial gesture.
Be that as it may, be aware that these fees are incorporated into the calculation of the TEG of your loan . To effectively compare two proposals from two different banks taking into account all the fees, it is preferable to study the TEG rates (for the overall effective rate, ie a rate that includes all costs related to this credit) and unencrypted conditions (modularity of repayments, fees negotiated on early repayments, etc.).
Help without charge
To finance your FIFA 2018 Today match Live Streaming or apartment purchase, you may not be able to make a mortgage. You may have a zero interest loan. You may also have a social housing loan under certain conditions.
Please note that there are no fees to pay for this type of financing assistance. This means that the amount that will be financed by a loan at zero rate, for example, will not be counted in the calculation of your fees by your bank. Good news when you know that a zero rate loan can go up to 40% of the cost of your purchase.
What if I go through a broker?
More and more borrowers are entrusting the research and negotiation of their home loans in Texas to a financing broker. There are several and you can quickly get results like with our mortgage simulation online.
There are two main categories of brokers:
Those who claim to be free for you and who are charged a commission of business introducer by the bank with which you will sign.
Those who charge you directly the fees for their work.
Overall the two solutions come back to the same. This does not exist a broker who works for free. Either you pay it directly or the bank pays it. Generally, she gives him the amount of the expenses of file since it is him who will manage all the initial relation with you.
So for you as a borrower, it does not change much. You will pay a fee. Either at the bank or the broker. The advantage of going through brokerage is that fees can be more capped than with a live bank.