If you're searching for a new home in Idaho, you'll receive what's known as a good faith estimate after you apply for a home loan. In Idaho, and in other states, your lender is required to hand over the good faith estimate within three days of your loan application. This document outlines all the costs associated with your mortgage, and experts suggest viewing it thoroughly before committing yourself to the mortgage. Before you commit to a lender, take a close look, especially at the following points.
This long list will include the appraisal fee, credit report fee, application fee, and mortgage broker's fee. One of the most helpful elements to the good faith estimate is that it allows you to compare different Idaho lenders. Watch out for big differences between lenders, as fees shouldn't vary too much. Look out for extra fees or missing fees. If you spot something that seems out of line, be sure and ask the lender about it.
Interest Rate and Points
The good faith estimate will show your interest rate and any discount points you're able to pay at closing. Paying discount points does buy you a lower interest rate and monthly payments, but it does take awhile before the savings make up for the up front fee.
There's a charge for the interest on the loan during the month before the first payment day. The closer you move the closing date to the end of the month, the lower the charge.
Title & Transfer Charges
This covers the standard charges of the escrow fee, title search and title insurance fees, and government taxes.
The good faith estimate may include a figure for homeowner's insurance. Though it can be less expensive to arrange your own.
Fees May Rise
Remember that a good faith estimate is just an estimate. The quoted figures could rise by closing day. However, lenders do try to honor the good faith estimate as closely as possible in order to avoid gaining a bad reputation.
The good faith estimate is there to give you a good idea of how much owning your new home will cost. It's important to familiarize yourself with this document before you sign any contracts, as the act is legally binding.
To get started with your new home search in Idaho, contact a Hughes Group team member today. (208) 571-7145