It’s bad enough that home shoppers are finding prices at record highs, but there is no need to compound the problem with a $63,000 mistake.
The simple act of shopping around for a mortgage can save homebuyers that much money over the life of a 30-year fixed-rate home loan, according to a recent analysis from LendingTree.
The company scrutinized data from more than 50,000 LendingTree users who got at least three offers from mortgage lenders in May 2022. LendingTree compared the offered mortgage with the lowest APR to the offered mortgage with the highest APR.
On average, in the nation’s 50 largest metros, borrowers who chose the home loan with the lowest APR saved an average of $63,151 over the lifetime of their loans. That is a savings of about $175 a month, or $2,100 a year.
Following are the top markets where borrowers can save the most cash over the lifetime of their loans simply by taking the time to shop around.
1. San Jose, California
Average lifetime savings among this metro’s borrowers who shopped around: $125,645 (for a 30-year fixed-rate mortgage)
California homes are notoriously expensive so every dime you save here really counts. When you realize that you can save more than $125,000 simply by taking the time to shop a little, it seems downright irresponsible not to compare rates.
2. San Francisco
Average lifetime savings among this metro’s borrowers who shopped around: $106,024 (for a 30-year fixed-rate mortgage)
The City by the Bay ranks No. 2 among the “15 Cities With the Most Luxury Home Sales.” When you are paying for expensive houses like that, even the tiniest reductions in your mortgage rate can pay huge dividends.
3. Los Angeles
Average lifetime savings among this metro’s borrowers who shopped around: $95,886 (for a 30-year fixed-rate mortgage)
Los Angeles is the third California city where homeowners can save a boatload of cash over the life of their loan just by getting multiple offers and taking the mortgage with the lowest rate.
Fortunately, LA is among the “15 Cities Where Homebuyers Get the Best Interest Rates.”
Here are the rest of the cities on the list and how much you can save by shopping around for a 30-year fixed-rate mortgage:
- San Diego: $95,884
- Seattle: $92,229
- Boston: $85,405
- Washington, D.C.: $79,567
- New York: $78,492
- Denver: $77,077
- Portland, Oregon: $76,887
Has this list convinced you to shop around for a mortgage? Stop by the Solutions Center and search for a great mortgage rate.