If someone walked up to you and told you that you could save hundreds, thousands, or tens of thousands of dollars without paying a dime you would automatically think it’s too good to be true or that there has to be a catch. Well, it’s true and there isn’t a catch.
A no-closing cost or lender paid closing cost mortgage is about the closest thing to free money that you can get. You benefit by lowering your interest rate, lowering your loan term, lowering your loan term and interest rate, or pulling cash out of your home without paying any closing costs which can literally save you thousands of dollars.
Here’s how it works.
Closing costs exist on all mortgages. That’s a given. But if we negotiate to have the lender pay for them while still improving your interest rate, that’s a win-win! And the savings are immediate. You don’t need to live in the in the house for a certain period of time to recoup those costs. Don’t need the cash from a refinance? It may be smart to do it anyway. If you apply all of the monthly savings to your principal balance each month, you’ll build equity faster and can possibly pay your loan off years ahead of schedule.
A lender-paid closing cost mortgage can also be a great option for borrowers purchasing a home, especially when there are no seller-paid closing costs negotiated into the purchase agreement. While a no-closing cost mortgage might only have a slight impact on the overall payment, it can save thousands of out-of-pocket dollars that can be used for furnishing the new home or making improvements.
Make sure to ask your mortgage broker if a no-closing cost or lender-paid closing cost mortgage is right for you. And always be sure to work with a mortgage broker who will do the analysis to make sure you’re getting the best mortgage for your needs.
Information provided on this website is for informational purposes only, and in no way is any of the content contained herein to be construed as financial, investment, or legal advice or instruction. Granite Mortgage Company does not guarantee the quality, accuracy, completeness or timelines of the information. While efforts are made to verify it, the information should not be assumed to be error free. Some information on the website may have been provided by outside sources and has not necessarily been verified by Granite Mortgage Company. Granite Mortgage Company does not assume any liability for the information contained herein.