Sunday, April 26, 2009

Finding the Best Mortgage Deal Takes Work

Home buyers who investigate mortgage options themselves as opposed to using a broker are likelier to get a better deal, according to a study for the Department of Housing and Urban Development published last year.

The study found that borrowers paid about $300 to $425 more in fees when they worked with a broker as opposed to working directly with a lender.

But comparison shopping can be tricky. Home buyers should try to devote a whole day to comparison shopping and include at least one credit union, a community bank, multiple national banks and an investment firms.

They should compare one type of loan at a time--for instance, a 30-year, fixed rate with no points. Their research should include a request for a guarantee that both the rate and the good-faith estimate will be exactly as initially presented. This standard could be difficult for a buyer to find, but it’s worth trying to find it, experts say.

Source: The New York Times, Ron Lieber (04/04/2009)

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