A recent survey by LendingTree reveals that 54% of U.S. homebuyers did not shop around for mortgage offers when purchasing their most recent home. This means a significant number of borrowers potentially missed out on better mortgage deals by not comparing options.
The survey, conducted by QuestionPro, included 2,001 U.S. adults aged 18 to 78. Findings showed that while 22% of respondents received two loan offers, only 17% received three or more. Baby boomers were the least likely to compare mortgage offers, with just 28% doing so, whereas 62% of millennials explored multiple options.
Jacob Channel, LendingTree’s senior economist and author of the survey report, emphasized the financial benefits of shopping around for mortgages. “Homebuyers are likely leaving money on the table when not shopping around. It’s not out of the realm of possibility for someone who received multiple offers and then picked the one with the lowest rate to save hundreds of dollars a month, thousands of dollars a year, and tens, if not hundreds, of thousands of dollars over the lifetime of their loan,” he said.
The survey highlighted that 45% of those who did compare mortgage offers found a better deal than what was initially offered by their first lender. Additionally, 46% of respondents ended up choosing a lender with whom they had no prior relationship.
Reasons for not shopping around included confidence in getting the best rate from their chosen lender (28%), a preexisting relationship between their lender and real estate agent (20%), and the need to expedite the financing process due to the competitive housing market (14%).
The survey also found that mortgage rates significantly influence homebuying timelines. Over one-third of respondents (35%) reported purchasing a home sooner than planned to capitalize on lower rates.
LendingTree’s findings underscore the importance of mortgage comparison shopping. By doing so, homebuyers can potentially secure lower interest rates and save substantial amounts over the life of their mortgage.