I am going to make this short and sweet today, but I was in talking with a bank Vice President today, and he told me about a way to get a better rate on your house without refinancing the traditional way. Now as a seasoned investor and now real estate agent, you would think I would already know about this, but I didn’t! And since I didn’t know about this, I figured my readers may not know about it either, are you ready for this?!
Negotiate with Your Current Mortgage Home Lender!
What, you ask? I thought that I had signed a 30 year note and the interest rate was set in stone. That is exactly what I thought too. That is why I go to great lengths to ensure that I get the very best rate, sometimes buy points, etc. to obtain the very best deal on a home loan while I am in the process of closing a deal. But you can negotiate.
Think about it from the lender’s point of view. Yes I like that I have a mortgage here that is paying me above the market rate. And I am very happy that I have an owner that is paying faithfully on the loan. I do not want to lose this customer.
So when you call in to the lender, and tell them you are unhappy that you are paying more than the market rate of interest for your loan and are thinking of shopping around for a new lender, you put yourself in an excellent situation to negotiate with your current lender.
So what’s the benefit of negotiating when I can just refinance with someone else?
The benefit is, you may be able to negotiate for the market rate of interest, and if so, all that has to happen is an amendment to the deed of trust and an amendment to the mortgage documentation. So that means that you only have some very minimal document fees to incur, which will probably only amount to a couple hundred bucks, instead of possibly well over $1,000 to refinance the home. Also, it is far less hassle to do it this way, as you will not have to have another appraisal done, another survey, wait for three weeks, and then have to go to the title company and close on the new loan. You save time, money, and hassle. Very nice benefits indeed.