Fresh research shows that more than eight out of ten homeowners are paying more than they need to on their monthly mortgage. As the below linked article shows, a credible source has found that amounts between $200 and $300 per month too much are being spent by unsuspecting homeowners. It is difficult to put a percentage or number of those that are not interested in selling or moving because of mortgage rates and/or other financial concerns. Being able to reduce thousands of mortgage payments by $250 per month. (which is below the average!) would result in those consumers having $3,000 per year more to pay down credit cards or spend on home improvements to name just two examples. Better credit favors an easier track to their next property or investment, which helps real estate brokers as well.
The issue here is part of real estate marketing. It is clear that too many home buyers and homeowners simply take the easy road of going with the recommended lender instead of thoroughly shopping the deal. Until or unless that changes, there is plenty of opportunity for lenders and brokers to pursue. As a consumer, being told that not shopping for my loan could cost me $3,000 more per year, my habits would change on the spot.
It is bad enough that many residential real estate agents do not fully educate their buyer and seller clients on the many aspects of an upcoming transactions. They should want their client to seek out the best deal, potentially at a cost of not working with “the preferred lender”. Helping the client is supposed to be the priority. Chances are the potential sellers that choose the first (and often only) agent they interview to handle the transaction have also not bothered to shop the loan.
Before you think it has to do with loans for problem credit situations, look again. The study shows that the HIGHEST group which overpays is those with the strongest credit. As one that has written and improved business plans and sales and operations manuals frequently over the past 35 years, I can tell you how much having the right research and information can influence a decision and outcome. It’s the difference of taking advantage of someone or being “first in” with the best possible scenario for helping your current or potential client!
(Here is the research:)
