Closing Costs 101: Expert Tips for Keeping Your Costs Down When Finalizing Your Mortgage

Are you thinking about buying a new home? If you are going to make use of mortgage financing, you may be wondering about some of the costs attached. As you may have heard, all mortgages have a number of fees and other costs that are assessed at the "close," or when you finalize the loan. Let's look at a few expert tips that will help you to keep your closing costs to a minimum when you take out your next mortgage.

Aim For Zero-Closing-Cost Options If Possible 

One question that you will want to ask your potential mortgage lender is whether they offer a low-cost or zero-cost option. What this means is that rather than you pay the closing costs, the lender pays them on your behalf. While the upside is that you aren't stuck with a hefty bill when you are approved for your mortgage, the downside is that you are likely to have a higher interest rate over the life of your mortgage. 

Get The Right Mortgage Loan To Suit Your Needs 

Another way to ensure that you keep your closing costs down is to opt for the right mortgage. There are a lot of options open to you in today's mortgage marketplace and navigating them to choose the right one can be tough. There are FHA-guaranteed loans, VA loans, USDA loans, traditional bank financing and a lot more. As each type of mortgage comes with its own set of closing costs, choosing the best one to suit your needs can limit the amount you will need to pay. 

Lock In Your Mortgage Interest Rate 

Finally, don't forget that most mortgage lenders will offer a "rate lock." This means that you can have a mortgage rate frozen for a set period. This might be 15, 30 or even 60 days depending on the terms of your mortgage. Using a rate lock can ensure that you keep a lower mortgage rate, even if interest rates were to change significantly in the meantime. 

There you have it – three tips that you can use to ensure that you keep your closing costs to a minimum when taking out your next mortgage. For more information about local mortgage options and insight into today's interest rates, contact us today. Our team of mortgage professionals is happy to assist.

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Wednesday, 22 January 2020
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