27 Aug 2021

Can You Negotiate Mortgage Rates?

Home Loan Basics for Millennials


Yes, you can negotiate your mortgage rate. In fact, most experts recommend trying to negotiate your rates. To successfully negotiate, you need to show you’re a worthy borrower and come to the table with a lower quote from a competing lender. Here are five tips to help you negotiate your mortgage rates.


Ask for the new customer rate.

It may seem scary, but contacting your lender directly asking them to give you the same rate their new customers can get the process started. Some lenders may not be willing to negotiate, but some will if they want to retain your business. Having a good credit history with no missed repayments may put you in a better negotiating position. 



In order to negotiate well with your lender, you need to know what rates other lenders are offering. You can use an online rate comparison tool to see how your current rate matches up against similar loans offered by other lenders. If you can show your lender you know there are lower rates, they may be willing to lower yours. 


Don’t Be Afraid to Refinance with a Different Lender.

Your lender may not be willing to lower your rate. If you go into the negotiation knowing you may have to walk and refinance with a different lender, you have the upper hand. 


Emphasise Your Loyalty

Show your lender that even though you’re not afraid to walk, you’ve been a good customer. For example, if you’ve made your repayments on time and have lowered your LVR over the years, you can use your loyalty as a bargaining chip. 


Be the Ideal Borrower.

If you’re a good borrower, your lender will want to negotiate with you as much as they can. Lenders want people who have:

  • An LVR lower than 80%
  • A good credit score
  • No missed repayments or past defaults
  • Steady employment and a good income


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