Personal Finance

Do this when shopping for a mortgage and you could save $430 in the first year

Key Points
  • Half of home buyers look to only one lender when getting a mortgage for a new home, according to a recent survey from personal finance website NerdWallet.
  • Comparing interest rates between five different lenders can result in $430 in savings in the first year alone, based on NerdWallet's calculations for a 30-year fixed-rate $260,000 mortgage.
  • If all Americans did this, they could save $776 million in one year across all home sales, the website said.
A 'Home For Sale' sign is displayed outside a house in Martinez, Calif.
David Paul Morris | Bloomberg | Getty Images

If you're not comparison shopping when looking for a home loan, you're probably losing money when you take out a new mortgage.

Half of home buyers look to only one lender when buying a home, according to a survey from NerdWallet.

And that is a mistake, according to the personal finance website. If you compare rates between five different lenders, you could stand to save $430 in interest in the first year on a 30-year fixed-rate $260,000 mortgage.

"That savings would accumulate and compound for every year that they had the loan," said Holden Lewis, home expert at NerdWallet.

If all Americans did this, they could save $776 million in one year across all home sales, according to NerdWallet's calculations.

VIDEO2:3602:36
Home sales are down due to low inventory, says Douglas Elliman CEO

Comparison shopping shouldn't stop there.

Prospective home buyers should also use an online home affordability calculator to better understand how their salary and monthly debt payments will affect their bottom line, according to Lewis.

In addition, you should be sure to ask plenty of questions when looking at a new neighborhood and home, he said.

"Ask a real estate agent and fellow home owners in that area, 'How much should I expect to pay for taxes, insurance, maintenance and repairs?'" Lewis said.

More from Personal Finance:
Buying a home for the first time? Avoid these mistakes
More people put off home buying because of student debt: Survey
Buying or selling a house? Ask your agent if they working in your best interest

Doing that research ahead of time will help avoid what you don't want: a case of buyer's remorse.

NerdWallet's survey found that 25 percent of homeowners said they felt financially insecure after buying their current home. First-time home buyers were more likely to lack confidence, with 34 percent agreeing with that statement.

NerdWallet's most recent home buyer survey was conducted online in January. It included 2,029 adults ages 18 and up.