In spite of recent reports suggesting a thawing in the housing market, it’s no secret that residential real estate still has a long road to recovery ahead. Whether you’re looking to buy or to sell, whether you’re taking out minimal home loans our seeking jumbo mortgage rates, you’re likely to be faced with stagnant prices, slow sale movement, and a difficult credit situation.
Mortgage rates are a main factor behind the slow housing revival. Even if you want to buy a home and have the appropriate finances and earning potential, many once-eager lenders will now be hesitant to offer you a mortgage, especially if you are younger or have never owned a home before. And, if they do, these lenders may offer it at a rate that places an unmanageable burden upon you and your spouse. As a result many people have removed themselves from the buyer’s market altogether.
But don’t give up quite so easily if you want to buy and finance a home. Although lenders are being conservative in their dealings, this certainly doesn’t mean that they want to turn away business during a difficult time. Along these lines, even if you get a mortgage rate offer that you find too high, you can always try to bring down the rate by negotiating with the lender.
Here are a few suggestions to help you in the negotiation process:
Know the market. Don’t simply walk in to a negotiation without having some knowledge about your demographic and about your local housing market. Use sites like Zillow.com and Bankrate.com to determine local mortgage rates. Talk to friends going through the moving process to see what they pay. Call other lenders and get a rate quote. The more numbers in your head when you enter into a negotiation, the better your chances for success.
Tout your credentials. Besides ownership history, lenders look to your credit score, your employment record, and your down payment sum when they try to determine whether you are a low-risk borrower. Assuming that you have strengths in at least one of these categories, make sure to tout such strengths as signs of your dependability while at the negotiation table.
Get outside support. Finally, you can always try to secure a lower rate by getting someone with a long ownership history to vouch for your loan. This person is usually a parent or relative. Make sure that you can keep any financial commitments to this person if their involvement in the process becomes necessary.
Following these tips can help you gain added leverage in the negotiation process and hopefully secure a better mortgage rate for your home. While negotiating does not always work, it is always worth a prepared and informed try – especially when a mortgage is at stake.