Buying a home is an exciting and frustrating experience in equal measure. The idea of staying in your own space without having to pay monthly rent is surely exciting. However, there are many hidden costs when taking a mortgage that can make your experience sour.
One of the biggest hurdles that homeowners face is meeting closing costs. City Creek Mortgage notes that, on average, home buyers in Draper part with about 2–5% of the home’s purchase price in mortgage closing costs.
However, you don’t have to pay through your nose in order to get your dream home. Here are three tips to lower your closing costs.
Ask for a ‘no-closing costs’ mortgage
This may sound too good to be true, but it is actually possible. A no-closing costs mortgage is ideal if you are short on cash since the closing costs will be folded into the loan.
While you won’t save much on these costs during the entire repayment period, you will have avoided paying a lump sum immediately after closing the real estate transaction.
Ask for a loan estimate
Don’t let closing costs hit you by surprise. Ask for a loan estimate form from your lender even before you apply for the loan.
Although this isn’t required, some lenders will be willing to give you a loan estimate form even before you apply for the loan. You can use it to compare mortgage rates among different lenders.
Don’t hesitate to negotiate
Many buyers believe that closing costs are fixed, but it is not always the case. While some fees depend on several factors, closing fees vary from one lender to the next and are negotiable. Ask for a waiver for any of these fees and compare it to what other lenders are offering before you decide.
A home is one of the major investments you will ever make in your lifetime. Don’t let it be a hassle that will stress you for years to come. The tips above will help you reduce the overall cost of owning a home by lowering closing costs.