Asking Mortgage Company to Lower Interest Rate
Many credit card users know that they can save money by asking for a lower interest rate, but some homeowners don't realize that the same can be said of their mortgages. By negotiating with your lender, it is possible to have your mortgage's interest rate reduced without refinancing and save thousands of dollars over the life of the mortgage. And with so many homeowners facing the possibility of foreclosure, banks are unusually open to modifying the terms of their mortgages.
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Instructions
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Review your mortgage documents to determine your current interest rate. If you can't find the interest rate or can't find your mortgage documents, call your lender, ask to speak with a loan officer and ask her to check on your mortgage interest rate for you.
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Research the mortgage interest rates currently being offered by other lenders and mortgage brokers in your area. Tell them you are thinking about refinancing your mortgage and ask, "What is the best interest rate you could give me?" Be sure to jot down their answers for use with your current lender.
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Plan what you will say when you call your mortgage holder. You might use questions such as, "___ offers ___ percent interest--can you match that rate for me?" or, "I am investigating refinancing, can you lower my interest rate?" or simply, "I have been a long-standing customer, and I would like to get my interest rate lowered."
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Ask about a "workout." This is the simplest type of mortgage adjustment that doesn't require refinancing or closing costs. While generally aimed at homeowners at risk of foreclosure, lenders have received federal incentives that lower their costs in offering workouts to homeowners. A workout can substantially lower both your interest rate and your monthly mortgage payments.
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Call your mortgage holder and ask to speak to a supervisor or loan agent. Be polite and professional, and follow the plan you have developed to ask for an interest rate reduction. Remember that mortgage lenders are businesses like any other--they don't want to lose customers if they can prevent it. Remind the officer of your good payment history and let him know that you would like to stay with the lender if he can adjust your rate accordingly.
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Write a hardship letter explaining exactly why you need to lower your monthly mortgage payment (i. e. struggling to make payments due to unemployment, lost hours at work, illness, injury, etc.) and request a lower interest rate that will lower your payment. Reserve this step for use only if your mortgage holder has refused your previous request to lower your interest rate by phone.
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