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6 Actionable Ways to Reduce Closing Costs When Buying a House

By admin / August 7, 2019
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Getting ready to buy a house?

Want to make sure you’re not paying too much on closing costs?

If there are too many closing costs to deal with when buying a home it can be very frustrating and can eat into your overall budget. If you want to reduce your home buying expenses, it’s a great idea to look for ways to reduce the money you spend during closing.

Luckily, there are ways to do it. Below we’ll tell you how to reduce closing costs using these 6 actionable tips.

1. Negotiate Lender Fees

One of the best ways to reduce closing costs is to talk to your lender and negotiate with them. 

Make sure that the lender isn’t tacking any on too many charges that are completely unnecessary. If they are, don’t be afraid to reach out to your lender and see if they can remove any of the fees for you.

Closing costs and expectations can vary from state to state, so be sure to do your research. If you live in New Jersey, for example, you’ll want to find all of the closing cost info for your state that you can find.

2. Ask the Seller to Contribute

Sometimes the best way to lower closing costs when buying a home is to simply ask the seller or realtor if they can help cover them.

In many cases, a seller or realtor will be happy to help you out in order to get the home sold more quickly. This is particularly a possibility if they have been trying to sell the home for a long time or are a very motivated seller.

3. Shop for Services

When paying for inspectors, title companies, and other services related to closing on your home you should find out where there may be some wiggle room. Look on the Loan Estimate form provided by your lender to find out which services you can shop for.

By shopping around you’ll be able to find cheaper options and may be able to use your budget a little more wisely.

4. Choose a Later Closing Date

Another thing that can help you save money on closing costs is to select a closing date that is later in the month.

When you close on a home you’ll have to pay prepaid interest for the days that are between your closing date and the beginning of the next month. By selecting ar closing date that is later in the month you’ll have to pay a smaller amount on fees overall.

5. Look for Assistance Programs

You should also find out if there are any closing cost assistance programs you can make use of. Your state’s housing authority may have programs available that are meant to help with closing costs. There may also be private grants and programs available that could help as well.

In the case that you’re eligible for one or more of these assistance programs, you may find that you’ll be able to save a lot on closing costs.

6. Check Your Bank for Rebates and Offers

When first looking for a mortgage lender, you should check with your bank. Sometimes your current bank will offer you a special offer on a mortgage that you won’t be able to get otherwise.

Wells Fargo and Bank of America, for example, both offer rebates for mortgages and refinancing. Your bank may also offer a special rebate if you take out a mortgage with them or refinance, so it’s well worth finding out.

Understanding How to Reduce Closing Costs

If you’re looking for the best ways of how to reduce closing costs then you should be using the above tips. By following the steps above and considering your options carefully you may be able to avoid paying an excessive amount of money when closing on your new home.

Looking for more real estate tips? Explore the rest of our blog to find more helpful information and advice.

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