If you’re an American with a 30-year mortgage, your average monthly payment could be $1,494.
Finding nearly $1,500 a month isn’t a simple task for people. But luckily, if you want to save on mortgage, there are some things you can do.
When you’re looking for a mortgage, you have a lot more sway than you’d think. Most people think that the banks and lenders have all the power, but in some cases, the buyer can have just as much power as the lender.
Do you want to know 3 essential tips for negotiating your mortgage? If you follow this advice, you’ll have a rate your friends will envy!
1. Know The Competition
You wouldn’t go to a car dealership and buy the first sedan you see, so why would you get a mortgage from the first lender you visit?
People can forget that the lender they’re dealing with has a boss to please and a quota to make. They want you to walk out with a mortgage, and if they think you’re willing to go with someone else they’d be more than willing to lower rates.
If you want to truly save on mortgage costs, you need to shop around. See what other popular lenders are offering. Also be sure to use a mortgage calculator to better estimate rates.
Ask other lenders about refinancing options, home equity, and any other feature you think is important. Once you know these things you’ll be in a better position to negotiate.
2. Know Your Worth
Do you know your true credit score? We aren’t talking about an estimate from a free app, we’re talking about your true FICO credit score.
So many first time home buyers will agree to higher rates because they don’t know their credit score. They assume that they’re lucky to find a lender and will agree to anything because they don’t know how good of an investment they are.
Before you start truly shopping around, request a credit report from FICO. It doesn’t cost much, and you’ll have an extremely accurate picture of your credit
Anything above a 700 is considered a good score to have, but if you don’t have a 700 you shouldn’t panic. You can still negotiate and save on mortgage rates with a fair score.
3. Don’t Forget Extras
If you want to save on mortgage rates, you’re going to be focused on the overall mortgage amount and monthly payments. But those aren’t the only things you should be concerned about.
If you can’t get a lower monthly payment, focus on lowering the interest. Negotiating the interest rate can save you a significant amount of money and help cut down on the time you’re paying it back.
Settlement fees can also be negotiated. It can help cut down on the amount of money you’re spending out of pocket.
Save On Mortgage: Wrap Up
This post gives you the basics you need to know to negotiate, but there are other facets of the mortgage process you could have questions about.
Do you want to learn more about the home buying process or mortgages? Contact us so we can help you answer your important questions.