Mortgage Relationship Discounts
Welcome to Saving Money with Andrew!
In the world of mortgages, there are the “haves” and the “have-nots”. The “haves” took out a mortgage before December 2021, when interest rates began their stratospheric rise that took the average 30-year fixed rate mortgage to 7.39% (as of 9/24/23). The “have-nots” are stuck with much higher rates which, surprisingly, haven’t done much to slow down home prices—at best, they’ve plateaued.
But in any environment, every (fraction of a) percent matters. So it’s worth researching relationship discounts, or reduced rates or closing costs lenders offer if you have other accounts with them or, especially, if you deposit new funds.
For example, Citi offers a sliding scale of discounts, and Chase offers anywhere from a 0.125% to a 1% discount on your rate. While it varies from bank to bank, it appears some (if not most) banks don’t even require you to keep your funds there and so you may be able to withdraw your deposit after a certain period of time, keeping the discount. Be sure to confirm this beforehand.
If you’re in the market for a new home, make sure to ask about any relationship discounts available from your preferred lender. You can also research by simply searching for “[your bank] mortgage relationship discount”. You may find some generous offers!
And now, Andrew’s pick(s) of the week:
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