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  • Writer's picturekellyzrealtor

3 Hacks to Lower Your Interest Rate

The increase in interest rates has been all over the news for months now, and it’s left many buyers feeling like they’ll be stuck paying a high interest rate for the rest of their mortgage. But just because rates are higher right now than they have been in recent years doesn’t mean that you’re doomed to pay excessive interest. Try these three interest rate hacks to get the lowest rates in our market.


Hack 1: Ask the seller to help with an interest rate buydown. While you’re negotiating the terms on a sale, ask the seller to sweeten the deal by agreeing to an interest rate buydown concession. This allows the seller to “buy down” your mortgage’s interest rate by a certain percentage. A buydown can be permanent or temporary. Your real estate agent and lender can help you strategize on the right kind of buydown to ask for.

Hack 2: Negotiate with multiple lenders. Sometimes buyers are surprised to find out that every lender will offer you a different mortgage with different rates, amounts, and terms. This makes shopping around critical to finding the best interest rate for your mortgage. Interest rates can vary as much as several percentage points between lenders, so doing your research and negotiating with lenders will be well worth your time and energy.


Hack 3: Take over the seller’s old mortgage. Chances are good that the seller has a lower interest rate than you could currently get from a lender, so why not take advantage of that and assume their mortgage? To do this, you’ll need enough cash to cover the equity the seller has in the house. This is kind of like your down payment except instead of going to a lender, it goes right to the seller. However, keep in mind that not every mortgage can be assumed. Conventional mortgages cannot be transferred between the seller and the buyer, but government-backed VA, FHA, and USDA loans can be taken over by the buyer.


There are several different strategies that you can use to lower your interest rate, but these three are my favorite!

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