All costs involved in a mortgage are absolutely negotiable. No advertised rates and quoted fees are written in stone, and you, as a borrower, have a say in how the deal will turn out.
But not all homebuyers are born negotiators; some are just going to take whatever the other party wants. You don’t bargain for mortgage rates on a regular basis, so your lack of experience or knowledge about home loans naturally puts you at a disadvantage. You’re lucky if you find honest brokers that put your best interests above anything else, but what if not?
It’s a serious problem for anyone who applies for mortgage in Utah, Alaska, Michigan, and other parts of the country. But if you’re aware of the typical tricks experienced lenders use against average borrowers, you might tilt the balance in your favor.
The “Best There Is” Claim
First and foremost, lenders who like to get as many businesses as they could, will convince anybody their offer is unbeatable. It’s the lowest interest rate in the state, the smallest closing costs no lending company could match; it’s like you’re watching the shopping network.
Point is, there’s no such thing as the best deal. City Creek Mortgage says every deal is different, and each one is relatively perfect for an individual’s situation. One offer might be good enough for somebody else, but it may hardly meet your specific needs.
The “Break Even” Defense
No lender wants to close a deal just to break even. They only give these kinds of justifications so you wouldn’t ask for less, and passively accept whatever price they have in mind.
Don’t be afraid to say no when they refuse to meet you halfway, if you think the original deal is unfavorable. They need you just as much as you need them. And even if they actually wouldn’t earn serious coin on your loan, they’d be happier to have your business than not.
The Classic “Bait and Switch”
This is the oldest trick in the book. It’s when lenders tease you with a desirable offer, then suddenly pitch a higher rate when they feel you’re already too hooked to back out. It may be a waste of time and effort, but you might feel more regret signing a deal different than what was promised, instead of just starting from scratch again.
Getting a long list of quotes from a variety of sources can give you the leverage on the negotiation table. The mortgage industry is quite competitive, so use it to your advantage.