Mortgage Shopping 101: Negotiating

When it comes to grocery shopping, many people will go way out of their way to save a buck or two. But when it comes to a mortgage, many people don’t shop much at all. And the wrong deal here can waste thousands.

Earlier this year, when rates were around 5 percent, I refinanced my house at 4 and 3/4’s. The total fees that I paid were around 600 bucks. Here’s exactly how I did it…

First I went to the Internet and checked out a couple of mortgage shopping sites. I picked the four lenders offering the lowest APRs, or annual percentage rates.

Then I created a spreadsheet. I called my four lenders, confirmed their rates, then asked them in detail about fees they charge. I put it all down here.

When I was done, I requested each one email me this: it’s a good faith estimate. A more official document that confirms the rates and charges they quoted on the phone.

And now for the really fun part: I simply used my spreadsheet and the information on it, called up these lenders and pit them against each other to get the best deal.

If one lender quoted 5%, I told him another lender offered 4 and 3/4’s. If one said they charged $800 for a processing fee, I told them their competitor who wasn’t charging anything.

Once I got the best terms I felt like I could possibly get, I went ahead and did the deal… but I also looked at my settlement statement to make sure I got the stuff that I was promised.

Bottom line? Shopping for a house may be more fun than shopping for a mortgage. But if you do it right, mortgage shopping isn’t hard… and is definitely time well spent.

Popular Articles

These 6 Lifestyle Changes Might Help Prevent Dementia
These 6 Lifestyle Changes Might Help Prevent Dementia

Science says these practices can lower the risk of cognitive decline as we age.

10 Food Staples That Are Easy and Cheap to Make Yourself
10 Food Staples That Are Easy and Cheap to Make Yourself

Making any of these key foods yourself will improve your meals and your budget — not to mention your health, in some cases.

12 ‘Disposable’ Items You Should Reuse Rather Than Throw Away
12 ‘Disposable’ Items You Should Reuse Rather Than Throw Away

Are you throwing away money? Before tossing these items that are considered disposable, consider how to give them new purpose.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Comments