Mortgages are a type of loan used to purchase a property such as a house or apartment. They are likely to be the biggest financing contracts that you will ever personally sign for. As such, you will want to find ways to save dollars anywhere you can.
This article will outline five top ways in which you can save money upfront and during your mortgage
- Avoid Non-refundable Application Fees
Some mortgage lenders will charge upfront application fees, even if you do not end up using them for the mortgage. So it is always important to read the terms and conditions of any contract you agree to.
These application fees are typically non-refundable, however, they are avoidable. If a mortgage lender is asking for an upfront application fee, then seek out other lenders which may not require you to do so.
If you decide to go with a lender who does not charge an upfront application fee, then you will not lose anything if your loan application is declined or you choose to go with a different lender.
- Shop Around for Multiple Mortgage Quotes
It is important to seek out at least two or three mortgage quotes that have similar fees, instead of considering just one lender. Comparing different offers can help you to find the best deal available.
Even a 0.5% difference in interest rates between two different offers could translate into tens of thousands in savings over the life of a mortgage loan. So it is definitely best to shop around rather than going with the first option that you find.
- Do Not Order An Appraisal Immediately
An appraisal is when an unbiased professional, i.e. a real estate appraiser, assesses a home in order to determine its fair market value. This is required whenever a mortgage is needed to purchase, sell or refinance a property.
Appraisals are one of the most expensive steps in the mortgage transaction, and may sometimes be paid before finding out if the loan has even been approved yet. As such, you should request a full mortgage pre-approval prior to ordering an appraisal.
Pre-approvals should actually be done before the property is for sale or before you wish to start looking to buy, as it means you will not be rushed in a pressured situation. Some lenders will allow for appraisals to be transferred but it is important to note that you may have to pay for the appraisal fee twice if you decide to switch.
- Use An Online Mortgage Rate Comparison Site
It can be incredibly tiresome and time-consuming to request quotes from a number of different mortgage lenders. Instead, you can use online comparison sites to access mortgage rate comparison tables and instant quotes by providing just a few details. This will allow you to easily compare the different deals available so that you can choose the most competitive rate.
- Ensure All Paperwork Is In Check
There is certain information you will need to provide to get a loan. Prior to submitting through a mortgage application, it is important to ensure that all of your paperwork is in check to help to avoid any late payment or administration fees.
This includes proof of identity, bank statements, proof of income, savings statements and recent utility bill statements.
