Better SAFE than Sorry

Earlier this month, the Community Home Lenders Association posted on their website a side-by-side comparison of consumer regulation required of non-bank mortgage lenders (like Priority Lending) versus banks. The details are chilling.

Every individual Loan Originator at a non-bank lender must:

•Be licensed
•Complete SAFE Act Mortgage Competency Test
•Complete 20 hours SAFE Act pre-licensing courses
•Pass an independent criminal background check
•Do 8 hours/year of SAFE Act continuing education

Banks are completely EXEMPT from ALL of the above. Further, all non-bank mortgage lenders are subject to CFPB exams covering:

•Compliance with RESPA
•Other statutory requirements

All banks with under $10 Billion in assets are exempt – that’s 99% of all banks. These facts do not imply that all banks play fast and loose with borrowers and their dreams of buying a home. However, they do lay out a solid and persuasive argument to encourage buyers to go with a non-bank mortgage lender, without a doubt!

Shiny Objects Can Be Pretty . . . Expensive

Back in May, Trulia determined that new homes cost roughly 20% more than similar existing homes. Here are some other things to share with buyers:

Disadvantages to Buying a New Home
•More expensive than buying used
•Location probably isn’t ideal
•Despite being new, workmanship might be questionable
•Could be subject to costly HOAs, even if it’s a house
•Neighborhood dynamic is unknown
•Property values might be more volatile
•Construction nearby (eyesore and noisy)
•More cookie-cutter, less unique

Advantages to Buying an Existing Home
•Possibly cheaper
•Better, more central location
•Can buy in an established school district
•Can own in a more reputable and recognized neighborhood
•Old house might have new upgrades
•You can always renovate if need be
•Older houses tend to have more character, custom design
•Could actually be built better than a new home