When a mortgage loan applicant wishes to obtain financing from a bank, he will have to assume various costs, among which are the guarantee costs.
The costs in a mortgage loan
When a mortgage loan applicant files a financing request, the latter will have to face several costs. Obviously, these fees will be included in the total cost of the credit, but it is important to be aware of them and above all to be informed of the procedures for setting up fees. Some can be negotiated, others will be compulsory and imposed by a scale. We will first identify the application fees, this is an amount billed by the bank for processing the request, handling the documents and more generally for the time spent by the financial advisor. Brokerage fees may be added when the borrower requests a broker.
On the financing side, notary fees will be automatically included, there will be the fees of the notary as well as the costs of registration and drafting of the deed, the only official document making it possible to recognize ownership of the property for the purchaser. Other costs will also be involved in setting up the guarantee, whether in the form of a mortgage or in the form of a deposit.
Guarantee costs for the mortgage
Banks that offer mortgage financing will require a guarantee on the repayment of the debt, this guarantee can be put in place with a surety company, that is to say that a company offers to act as guarantor of the reimbursement of amounts due if the borrower does not honor its commitments. She will take care of repaying the bank immediately and then turn to the borrower to recover the amounts due. The establishment of the deposit will incur costs, which may also be partially recovered when the loan is fully repaid. It is important to request it to recover the sums.
If the surety is not possible (refusal of surety, or not offered by the bank), the borrower will then have to turn to the mortgage, it is a guarantee consisting in mortgaging the property by designating the bank as beneficiary, the latter can therefore order the sale of the property in the event of non-repayment of the debt, taking care to follow the procedure indicated. The setting up of a mortgage is done with a notary, there are costs related to the registration of the deed but also fees of the notary to be paid.
Negotiate the costs of your mortgage
The guarantee costs are not negotiable, it is often a national scale, it is however possible to review the fees of the notary or even to negotiate the administrative costs. It is strongly advised to call on a broker who, thanks to his relationships, will be able to negotiate with credit institutions and various interlocutors such as the notary or the surety company. The idea is to reduce as much as possible the various costs that may be involved in the implementation of the mortgage.