How important is it to comparison shop for loans?
Whether you do the footwork on your own or hire someone competent to help you doesn’t matter. But you must make sure that this comparison shopping gets done. Suppose that you’re in the market for a 30-year, $100,000 mortgage. If through persistent and wise shopping you’re able to obtain a mortgage that is, for example, 0.5 percent per year lower in interest charges than you otherwise would have gotten, you’ll save about $14,000 over the life of the loan (given approximate current interest rates). Double those savings for a $200,000 mortgage. Although we encourage you to find the lowest-cost lenders, we must first issue a caution: Should someone offer you a deal that is much better than any other lender’s, be skeptical and suspicious. Such a lender may be baiting you with a loan that doesn’t exist or one for which you can’t qualify.
