The Surprising Way You Might Save Money on Your Mortgage
by Maurie Backman | Published on Sept. 22, 2021
One lender is offering a discount for applicants who make this move.
The Delta variant of the coronavirus has caused a surge in COVID-19 cases, and some companies have stepped up, encouraging Americans to get a jab by offering perks like free food and beverages. Meanwhile, some states have opened lotteries to motivate people to get vaccinated. And now, a mortgage lender is joining their ranks.
Get vaccinated, save money
Neat Capital has announced it's giving a $500 discount to new purchase mortgage applicants and refinance applicants who provide proof of a coronavirus vaccination. That $500 comes off of borrowers' closing costs, which can commonly equal 2% to 5% of a given loan amount. The lender is extending that bonus to unvaccinated borrowers who present valid proof of a medical or religious exemption to getting a vaccine.
Clearly, saving $500 on closing costs is a nice incentive for borrowers looking for a new mortgage or a refinance. But that's not the only way to save money when taking out a home loan.
Other ways to save
A good way to lower your mortgage costs, whether it's the interest rate or the closing costs, is to shop around with lenders. It's often the case that one lender is more competitive than another on interest rates, closing costs, or both. The more offers you gather, the easier it is to see which loan choice makes sense.
You can also save money on your mortgage interest rate if you have a strong credit score. Generally, borrowers with a credit score in the mid- to upper-700s or higher receive the best rates. If your credit score could use some work, you can boost it by paying all of your bills on time, paying off some credit card balances, and correcting any errors on your credit report.
Meanwhile, there is another step you can take to save money on your closing costs -- namely, speaking up and negotiating. Though some closing costs aren't set by lenders (for example, prepaid property taxes required at closing), other fees may come with wiggle room. For example, lenders routinely charge loan origination and application fees that they often can cut applicants a break on.
You may also be able to lower the closing costs on your mortgage by hiring your own home appraiser rather than going with your lender's. But make sure your lender is on board with that before going forward. (If you're refinancing, you may not need an appraisal to finalize your loan, though in some cases, you do.)
Get protected and rewarded
Now that the FDA has approved the Pfizer vaccine, more people may feel comfortable getting their shot. And getting vaccinated could do more than protect your health -- it could also result in major savings on a home loan.
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