When buying a new home or refinancing your current home, small expenses can add up. However, a mortgage payment is one of the largest expenses a homeowner will pay for each month. Who wouldn’t want to save a little extra money here and there? Whether you’re looking to buy a new home, refinance your current loan or just save a few extra bucks, these tips will help you cut down your mortgage costs.
Get More Than One Quote
Sure, settling for the first option might be really convenient, but don’t take the easy way out. If you shop around for more than one quote, you can compare then and will have a greater chance of saving money.
According to a recent study by Susan Woodward and Robert Hall, the average consumer could save $981 in origination fees by getting three mortgage quotes for a mortgage with a $100,000 principal.
While taking the easy way out may seem tempting, shopping around will put you at an advantage in the long run.
The most common way to save money on your mortgage is by refinancing your loan to a lower interest rate – you can even score a historically low interest rate!
Remember to read the fine print, so to speak. There are costs associated with refinancing. Make sure to add up all of the fees prior to refinancing to ensure that they won’t cancel out the benefits of a new loan.
Avoid Unnecessary Fees
Application fees can appear to be a necessity when applying for a loan, however, you should avoid them whenever possible.
According to a mortgage refinancing guide published by the Federal Reserve System, application fees can range from $75 – $300 and cover small, routine actions.
These fees can be unnecessary because if a bank chooses to not process your loan, they won’t refund the application fee. There are plenty of dependable banks that won’t charge homeowners for an application fee.
Although mortgages aren’t exactly a fun thing, they don’t have to be stressful. Remember to shop around, read the fine print and avoid unnecessary fees.
For more great ways to cut mortgage costs, check out this great article.