18. Loan Estimates: Services You CAN Shop For

by Local Title

When reviewing your Loan Estimate, it’s essential to recognize the services for which you have the freedom to shop and compare providers. Unlike services you cannot shop for, which are paid to outside parties without your choice, these services offer you the opportunity to select providers that best suit your needs and preferences. Here’s a closer look at the services you can shop for:

Pest Inspection and Survey

Services such as pest inspection and property surveys are essential for assessing the condition of the property and verifying property lines. These services help identify any potential issues or boundary discrepancies, providing peace of mind to both buyers and lenders. As a borrower, you have the flexibility to shop around and compare providers to ensure you receive high-quality service at a competitive price.

Title-Related Services

Title services encompass various aspects of the property’s legal ownership and rights. These services include:

  1. Lender’s Title Policy: This policy protects the lender’s legal interest in the loan collateral, typically the property itself. It ensures that the lender’s investment is protected against any unforeseen title issues or disputes.
  2. Settlement Agent Fees: These fees are paid to the individual or company responsible for facilitating the final transaction, including the transfer of ownership and disbursement of funds.
  3. Title Search: A title search clarifies and documents the legal ownership of the property, ensuring there are no outstanding liens or encumbrances that could affect the transaction.
  4. Title Insurance Binder: This binder allows for the potential future use of current title search results, conditions, and exclusions for a short period, reducing the cost of future title insurance.

While borrowers are free to select service providers for these title-related services, it’s essential to note that the fees for selected providers must adhere to certain guidelines. If you choose service providers from the list provided by the lender, their fees cannot change by more than 10% between the Loan Estimate and the final Loan Disclosure. However, if you opt for providers outside the lender’s list, the lender is not responsible for any changes in those costs.

Navigating Service Providers

By understanding the services you can shop for on your Loan Estimate, you can take control of the selection process and ensure you receive quality services at competitive prices. Take the time to research and compare providers, and don’t hesitate to ask for recommendations from your lender or real estate agent. With careful consideration, you can select service providers that meet your needs and contribute to a smooth and successful real estate transaction.