Homebuyers, you could have saved $47,271 by shopping around for a mortgage last week

Mortgage borrowers who shopped around last week could’ve saved $47,271 on the life of a $300,000 loan, according to LendingTree‘s Mortgage Rate Competition Index.

The index measures the spread in the APR of the best offers available on its website. LendingTree derives that savings claim by comparing the amount a borrower would pay out of over the life of a loan at the lowest available interest rate on its site versus the highest available interest rate.

According to the company’s data, the share of borrowers who received rates under 4.25% fell to 24.2%, with the index growing to one for the week ending June 16, 2019. 

Although this percentage is significantly down from last week’s 53.5%, it still surpasses 2018’s rate when just 0.02% of purchase offers were under 4.25%.

The report also highlights that across all 30-year, fixed-rate purchase mortgage applications made on LendingTree’s website, 10.5% of borrowers were offered an interest rate of 4.875%, making it the most common interest rate.

When it came to 30-year fixed-rate refinance borrowers, 16.1% received offers under 4.25%, plummeting from 65.2% one week prior. Despite the decline, this rate is still up from 2018’s rate when 0% of refinance offers were under 4.25%.

This means with a wider refinance market index of 1.33, the typical refinance borrower could have saved $64,188 by shopping around for the lowest rate.

According to the report, across all 30-year, fixed-rate refinance applications, the most common interest rate was 4.45%. This rate was offered to 14.3% of borrowers.

This image highlights the distribution of last week’s interest rates:

 (Click to enlarge; Source: LendingTree)

NOTE:  The LendingTree Mortgage Rate Competition Index measures the spread in the APR of the best offers available on its website.

Article source: https://www.housingwire.com/articles/49374-homebuyers-you-could-have-saved-47271-by-shopping-around-for-a-mortgage-last-week

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