2FD 054: Saving Money Buying, Selling and Refinancing a Home

Dan Green from Growella has 15 years of mortgage lending experience and joins us today to try and help you save money on buying, selling and refinancing homes. Dan breaks down the complex transactions and points out the places to maximize your value. If you’d like help with reducing your mortgage rate, Dan has offered to help here. CHA-CHING!

Discussion Points

  • The process of buying or selling a home.
  • How to find a good realtor and a good lender.
  • What goes into closing costs.
  • Where to shop around for lenders and when to do it.
  • The myth about when to refinance a home.
  • Why you should refinance your mortgage more often than you think.
  • Frugal Tip of The Week: How to build credit without a credit card that has an available credit outside of your means.

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The Cheat Sheet!

  • The home buying and selling usually starts 18 months in advance.
  • House listings on the market spike starting on Christmas afternoon.
  • Getting a pre-approval letter from a lender is crucial before starting your home buying search to understand what’s really possible before you start looking for houses without knowing what you can really afford. Being prepared can help you make a great offer as soon as the house you want becomes available.
  • You have to find a really good agent that is focused on getting you the most value for your money in both selling or buying a home. Everyone knows a realtor but you have to find the good ones.
  • As a buyer, make sure that you are not using the same real estate agent as the seller because they are not required to maximize your savings.
  • Look for a committed, full time realtor who is dedicated to serving you best vs. someone who does it part time.
  • Start your realtor search with referrals first and let realtors know up front what is important to you in your home search.
  • Lender mortgage closing costs (A.K.A. origination fees) consist of appraisal, credit report fees, lender fees and discount points.
  • Overall costs on top of the mortgage costs are for the home inspection, title search, real estate taxes.
  • A discount point is an optional fee where you pay an upfront amount of money for a discount on your mortgage rate.
  • A title search shows the seller has the rights to sell the home.
  • Set aside non-lender related costs in your comparison for lender shopping.
  • If you have fewer lender fees, you probably have a higher rate or the opposite.
  • When you compare lenders, pick what is most important to you, either lower closing costs or a lower rate and compare lenders with that variable consistent because there are a lot of variables lenders can play with when price shopping that could confuse you in the comparison.
  • The mortgage application and approval process can feel complex so try to find a good mortgage lender that will remove this stress for you and make you feel comfortable in your decision.
  • Always get more than one quote for your mortgage. Your best lender today might not be your best lender tomorrow because the rates each lender can provide change every day.
  • A broker lends somebody else’s money but that doesn’t mean they can’t get you a great rate. Don’t exclude brokers, banks or online portals in your search. Shop all of your options for who has the best deal on the day you need it.
  • Corespondent lenders use their own money, differently from a traditional bank.
  • A good mortgage lender will call you when rates drop to let you know it’s a good time to refinance.
  • There are plenty of great times to refinance your home outside of the myth you’ve probably heard where it only makes sense if you can get at least 1 point lower.
  • If you can save money and pay no closing costs, it makes sense to refinance. It’s all about the bottom line. You can take your new savings and add it to your new mortgage payment and pay your house off even sooner.
  • You don’t have to wait for a large drop in interest rates, take small decreases along the way down since you can’t time the market and want to save along the way, it only takes one hour to apply.
  • Always educate yourself and then seek professional help where years of experience can maximize your value.
  • Frugal Tip of The Week: Secured credit cards can help you build credit while removing the opportunity to spend money you don’t have. There may be times where you still need a credit card and they can come in handy. (Sean said FDA loan and meant FHA).
  • Growella has some great personal finance content available straight from the people with first hand experience and years of professional service.
  • If you’d like help with reducing your mortgage rate, Dan has offered to help here.

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