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Shopping for a Home Loan

Shopping Around Can Pay Off

Smart shoppers know when to buy and when to keep looking for a better deal. But can we apply these principles when it comes to mortgages? Originally, when I decided to get pre-approved for a home loan, I thought I’d just head over to my local bank and see what I could get. But then I read this excellent little pamphlet from the U.S. Department of Housing and Urban Development. (HUD) called “Looking for the Best Mortgage: Shop, Compare, Negotiate.” It’s a quick, easy little read that explains all of the different factors you should take into consideration when comparing loan offers. It also has a handy-dandy worksheet that you can take with you when shopping to grill the lender, broker, or loan officer and make sure you didn’t miss any important factors that will affect what you end up paying for the loan. There are approximately 30 different factors to ask about on the worksheet. 30! That’s news to me - I was thinking in simple terms of 1) loan amount and 2) interest rate.

What surprised me most about reading “Looking for the Best Mortgage” was the fact that the offers you get are not set in stone. Of course, they are influenced by the quality of your credit, but you can negotiate and pit lenders against each other to give you a better deal. Sometimes there are different interest rates available during the same day - make sure you get the lowest one! Also, you can ask them to waive some fees. Also, brokers could be holding back because they may have a financial incentive to make you pay more. So play hardball.

Because there’s nothing worse than paying too much for something you could have easily found on sale. Especially if you’re paying for it for the next 30 years.

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Do you have any tips for women looking at buying real estate, based on your own experience?

Have you gotten a great deal on a home loan? How did you do it?