Here in Essex County there are virtually hundreds of Windsor mortgage brokers that can assist you with a mortgage loan. Just open our local Yellow Pages and have a look. Some agents are offering special mortgage rate programs, others refinancing, and others home equity loans. But sometimes when you really drill down into these loan programs, you may find what I like to call “nonsense fees” popping up.
While the majority of Windsor credit unions, lenders and mortgage agents are honest and often provide a positive experience, it’s very important that you be aware of some of the dishonest tactics you may encounter when you refinance or seek a Windsor home loan program.
If you live in Windsor, it’s no doubt you’re very aware of the troubled times we’re facing. Businesses are closing, layoffs and job losses appear in the Windsor Star almost daily. At the time of this writing, Windsor’s unemployment rate is 13.6%! With all of Windsor’s economic circumstances, choosing a mortgage broker who understands how to successfully work with our city’s unique challenges, and who doesn’t charge additional / extra fees, is crucial for positive loan outcome. In fact, avoiding unnecessary fees can save you thousands of dollars over the course of your mortgage loan. To be forewarned is to be forearmed….
Many of the nonsense fees you’re about to learn, are additional fees that are simply not necessary (in most cases). They can be fees completely made up or added by a Windsor mortgage broker who is simply trying to make more money from your refinance or mortgage loan, and sadly at your expense! It’s easy to conceal many of these fees within a complicated mortgage/refinance contract. And unless you have a lawyer reviewing every dotted “I” of your loan agreement multiple times, nonsense fees can be easy to miss.
Nonsense fees are created at the mortgage broker/agent level, and are completely at the discretion of the mortgage broker you choose to work with. Some Windsor mortgage brokers can get really creative with their fees. Here are just a few creative nonsense fees I’ve seen in the past:
TOP 4 NONSENSE FEES TO AVOID:
- Lender Charges
- Document Processing Fees
- Retainer Fees
- Application Costs
The above listed fees can add up to hundreds, even thousands of extra dollars, and when you’re finished paying, you may end up paying more for a mortgage or refinance loan then you should have!
If you see any of these fees, call your Windsor mortgage broker or agent out on them. For instance, ask why you’re paying a lender fee, if your mortgage agent is already being paid by the lender for the same thing? Otherwise, your mortgage agent is basically charging double what he/she should be – in other words, double dipping.
A Few More Unfair Mortgage Loan Tactics That Could Cost You Thousands!
Mortgage Penalties: If your existing mortgage loan has a prepayment penalty, some lenders or Windsor mortgage brokers will offer to “handle” penalties when you refinance, just to keep your deal. What they often fail to mention is that you’re actually still paying them anyway. Some mortgage lenders will figure those penalty fees into the interest rate that they offer you. So not only are you actually paying them, you’ll pay interest on it as well.
Lender Tied Selling: Dishonest mortgage loan tactics are one thing; this next point pretty much crosses the line into being on the border line of illegal. If you have a Windsor mortgage loan with a particular lender, chances are you may have a credit card account or maybe even a line of credit with that same lender. Sometimes, when a lender learns that you may be refinancing your loan with a different financial institution, you may be told that your credit card account or credit lines may be closed if you refinance your Windsor mortgage loan with someone else. This is called Tied Selling and is considered illegal.
Monthly Interest Compounding – Some Windsor mortgage brokers or lenders will compound the interest on your refinance or mortgage loan monthly instead of twice a year, while offering you a slightly lower interest rate. This results in you paying much more interest in the long run.
Remember, cheap Windsor mortgage loans or refinancing options aren’t so cheap if it winds up costing you a whole lot more in the long run. Take the time to really understand the fees that any Windsor mortgage brokers put in front of you.