- To know before negotiating the interest rate of a mortgage
- Play the competition to negotiate the interest rate of a home loan
- Negotiate, without just looking at the mortgage interest rate
When buying a property with a loan, any individual hopes to obtain the lowest possible interest rate, whether to reduce the overall cost of credit or its duration, or to increase its financing. However, negotiating the interest rate of a home loan is not obvious and results from some subterfuges. Here are a few tips.
To know before negotiating the interest rate of a mortgage
Before considering any negotiation, you should first inform yourself about the level of real estate interest rates. There are different websites for this purpose. the best borrowing rates that it is possible to obtain at a moment T.
Some banks also offer their credit simulator online, which allows to have, even as an indicator, an idea of their rates.
It is then essential to keep in mind that each organization defines its lending policy for a given period (depending on regulatory constraints, the market, competition, etc.). Thus, a bank can offer you a favorable interest rate at a time T that will not be a few weeks or months later.
Lastly, it is important to take stock of your borrower profile before you start. In addition to your personal contribution, any bank will look among other things your professional situation, your ability to repay but also savings, keeping your accounts... to determine your strengths and weaknesses.
Play the competition to negotiate the interest rate of a home loan
Once armed with all this information, you can then negotiate the interest rate of your future mortgage, and the best way to achieve this is to compete.
Go see your bank to get his proposal, then go to one or two colleagues to have a comparison. During interviews with them, do not hesitate to ask a more competitive rate in return for which you could domicile your income, open a savings account or take out insurance. A rate cut of 0.10 to 0.30 points can then be granted depending on the context. Also, do not deprive yourself of reviewing your bank to ask for a similar offer to competitors if it is more advantageous, with the potential risk of losing you as an argument.
Second option, that of the mortgage broker. If it costs you a commission on the loan granted, these professionals act as wholesalers so that they can negotiate for you a very interesting interest rate.
Negotiate, without just looking at the mortgage interest rate
Looking at the single loan interest rate is not enough, and it's about the overall cost of credit that you need to pay your full attention. The advantage a low rate As it can be quickly absorbed by the application fees and the loan insurance, your negotiation must also include these elements.
Concerning the insurance, this one can be subscribed with another organization but, to be accepted by the bank, the guarantees will have to be the same ones as those proposed with the loan offer. For the file fees then, these can be reduced by half by offering if necessary a small counterparty to the bank, even to be offered by this one.
Lastly, the negotiation of a mortgage can also extend to other services of the bank, such as free account fees for a fixed term for example.