Prospective homeowners need to be familiar with the terms of their mortgage rate.
Negotiating a mortgage rate is a top priority for many homeowners, but remember, any great deal is only as good as the terms and conditions that go along with it. During the closing process, make sure you understand the associated costs and circumstances that can impact the overall feasibility of your loan in the long-term. Consider the following:
- Closing Costs. Although closing costs are a one-time fee associated with finalizing your mortgage loan, they can be a sabotaging factor if they are abnormally high. Getting a decent mortgage rate might not be a great deal if it comes with a huge closing cost. Be mindful of monitoring this element throughout the negotiation process. Don’t get stuck with a nasty surprise at the end of your negotiation.
- Loan Terms. The fine print can be extremely confusing with mortgages. Asking questions might seem intimidating, but is an essential part of securing the best mortgage rate. Get a firm answer by asking specific questions. Keep in mind that some loan terms change over time and some interest rates increase after the first few months. Remember that mortgage rates are usually negotiable and you have the right to push back on the original offer.
- Shop Around. Interest rates are directly related to the lending bank’s commission, so it’s smart to shop around and get competitive offers. Especially if you are an attractive borrower with good credit and minimal debt, banks will want to entice you with better interest rate offers to land your business.
Click here to get more information about mortgage rates and negotiation from our friendly team at Midland Mortgage.