A majority of homebuyers aren’t shopping around for a mortgage, according to new data from LendingTree. Specifically, 54% of buyers who took out a mortgage for their most recent home purchase received just one offer from one lender, 22% got two offers and 17% got three.
“There’s no magic number for how many offers homebuyers should compare before they pick a lender, but looking at at least two can help people save serious cash,” said LendingTree Senior Economist Jacob Channel in a statement. “The reason for this is because different lenders can offer different rates to the exact same borrower. With that in mind, the first rate you’re offered may not be the lowest one you can get. The more offers you can look at, the better. But, even if you only get a couple, you could still find a lower rate than if you just went with the first lender you talked to.”
Diving deeper into the data, women are 62% more likely than men (46%) to accept their first mortgage offer without searching elsewhere. Older generations are also more likely to follow suit. Almost three-quarters (72%) of baby boomers report that they don’t shop around for mortgages compared to 59% of Gen Xers and 38% of millennials. In other words, baby boomers are the generation least likely to shop at 28%, and millennials are the most likely at 62%.
Buyers who sought just one mortgage offer claimed their main reason for doing so was their belief that they got the best rate (28%).
And while most buyers aren’t rate shopping, those who did (45%) claimed that their patience and persistence paid off, as the lowest offer they received did not come from the first lender.
“Because savings can be so large and you can compare lenders for no charge, pretty much everyone should at least try to shop around before they get a mortgage,” Channel explained.
To read the full report, click here: https://www.lendingtree.com/home/mortgage/shopping-around-survey/
