According to the 2009 National Housing Pulse Survey, an annual survey released by the National Association of Realtors, most Americans consider that closing costs are one of the biggest obstacles in purchasing a home.
Here are some possible ways to save some money on closing costs:
- Have your real estate agent negotiate with the seller to pay all or part of the closing costs. The lender must agree to this as well as the seller.
- Weigh the options of a no-point loan with your loan officer. The trade-off is a higher interest rate on the loan and many of these loans have prepayment penalties. But buyers who are short on cash and can qualify for a higher interest rate may find a no-point loan will significantly cut their closing costs.
- Ask your lender or mortgage broker about a no-fee loan. Usually these fees are wrapped into a higher interest rate, though it will save you on the amount of cash you need upfront.
- Explore the options of seller financing. This kind of arrangement usually does not entail traditional loan fees or charges.
- Rent the home in which you are interested with an option to buy. That will give you more time to save for the upfront cash needed for the actual purchase.
- Shop around for the best loan deal. Each direct lender and each mortgage brokerage has their own fee structure. Call around and do some due diligence before submitting your final loan application.
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