Did you know that you can negotiate with a bank or lending institution for the best home loan interest rates and fees? What you see advertised is not necessarily what you will pay, and while there is often very little room to move, even a few points on the interest percentage can save a lot of money over the term of the loan.
Here are some top tips to get yourself in the most favourable position to negotiate the best home loan interest rates.
- Save Up For A Bigger Deposit
You can reduce the principal loan amount by putting down a more significant lump sum upfront. Your larger deposit reduces your lending ask, putting you in a more favourable position to negotiate a better rate.
- Do Your Homework
Shop around online to see what the best home loan interest rates are being advertised. Use online repayment calculators to determine what the repayments will be at the various interest rates and loan terms to help you figure out who is offering the best deal. And remember, you can still negotiate a rate below the advertised rate.
- Improve Your Credit Rating
A good credit rating makes you less of a risk to the lending institution or bank. If you have established a good track record of paying your bills and debts, you will be better positioned to fight for the best home loan interest rates.
- Budget For Larger Repayments
Committing to making larger regular repayments than the minimum required amount can give you some leverage when negotiating the best home loan interest rates. Not only will you reduce the interest portion of your loan, but you will also be able to pay off the loan a lot faster and reduce the total amount of interest you end up paying by a significant amount.
- Hire A Mortgage Broker To Get You The Best Home Loan Interest Rates
One of the most straightforward solutions to securing the best home loan interest rates is to engage the services of a reputable mortgage broker. They will have established relationships with various lending institutions and banks and will be in an excellent position to negotiate a reasonable interest rate on your behalf.