Today the Consumer Financial Protection Bureau (CFPB) released some new online tools to help you shop for a mortgage. The home buying process can be daunting, with so many decisions to make as you move through unfamiliar and high-dollar territory. That may explain why a new CFPB investigation found that nearly half of all home buyers don’t shop for a loan.
The message for today is that shopping for the best mortgage is just as important as finding the right home.
Let’s be honest. Most of us would think nothing of traveling an extra 20 minutes or scouring multiple websites to save a few dollars on a microwave oven that may last only a few years. But what about shopping for a mortgage? Sure, it’s easier to just take the first mortgage that lands in your lap, but that could be a costly mistake. The CFPB says that 77 percent of borrowers only apply to a single lender. But in the long run, not going the extra mile to find and buy the right mortgage can cost you many thousands of dollars over the life of the loan. Long after that bargain microwave stops working, you might still be paying more than you should for your mortgage if you didn’t bother to shop around. And just think, what else could you do with the thousands of dollars you could save by shopping carefully now?
To help you navigate the mortgage buying process, the CFPB toolkit gives you handy checklists to know what to expect and to help you make a great deal. While lenders, brokers and agents can be informative, they also have a stake in the transaction. You shouldn’t rely only on the information you get from someone who has something to sell. The CFPB makes it easier for you to do your homework. Their new toolkit lets youcheck interest rates by state, helps you to understand loan options and advises you on how to win at the closing table when you are ready to finalize your purchase. Knowing your rights and avoiding common mistakes are keys to feeling confident and prepared in the home buying process. We recommend you use these tools and share them with others. At the end of the day, you want to feel the peace of mind that comes from knowing you’ve done everything possible to get the best deal you can. That’s true consumer power.
One last point. Remember, checking out multiple mortgage options won’t hurt your credit score, says the CFPB, so don’t let that stop you.