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The surprising way to save money on your mortgage

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The Delta variant of the coronavirus has caused an increase in COVID-19 cases, and some businesses have stepped up, encouraging Americans to get a hit by offering perks like free food and drink. Meanwhile, some states have opened lotteries to motivate people to get vaccinated. And now a mortgage lender is joining their ranks.

6 simple tips to get a 1.75% mortgage rate

Secure access to The Ascent’s free guide on how to get the lowest mortgage rate when buying your new home or refinancing. Rates are still at their lowest for decades, so act today to avoid missing out.

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Get vaccinated, save money

Neat Capital announced that it is giving a rebate of $ 500 to new mortgage applicants and refinancing applicants who provide proof of a coronavirus vaccination. That $ 500 comes from borrowers’ closing costs, which can typically be 2% to 5% of a given loan amount. The lender extends this bonus to unvaccinated borrowers who present valid proof of a medical or religious exemption to be vaccinated.

Obviously, saving $ 500 on closing costs is a great incentive for borrowers looking for a new mortgage or refinancing. But this is not the only way to save money when taking out a mortgage.

Other ways to save

A good way to reduce your mortgage costs, whether it’s interest rate or closing costs, is to shop around with lenders. Often times, one lender is more competitive than another on interest rates, closing costs, or both. The more offers you collect, the easier it is to see which loan choice makes sense.

You can also save money on the interest rate on your mortgage if you have a good credit rating. Typically, borrowers with a credit score between 700 and 700 or higher have the best rates. If your credit score might take some work, you can improve it by paying all of your bills on time, paying off certain credit card balances, and correcting errors on your credit report.

In the meantime, there is another step you can take to save money on your closing costs, which is talking and negotiating. While some closing costs are not set by lenders (for example, prepaid property taxes required at closing), other costs may come with some wiggle room. For example, lenders regularly charge origination and loan application fees, which they can often reduce the waiting time for applicants.

You may also be able to reduce your mortgage closing costs by using your own appraiser rather than your lender. But make sure your lender is ok with this before you go ahead. (If you are refinancing, you may not need an appraisal to finalize your loan, although in some cases you will.)

Be protected and rewarded

Now that the FDA has approved the Pfizer vaccine, more people can feel comfortable getting the vaccine. And getting the vaccine could do more than protect your health – it could also mean significant savings on a home loan.

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