Shopping Mortgage Rates Could Save Borrowers Over $80,000

In a housing market marked by high prices and elevated interest rates, homebuyers may feel like their options are limited. But one powerful strategy remains: shopping around for mortgage rates. A recent analysis from LendingTree reveals that doing so could save borrowers a significant chunk of money—over $80,000 on average over the life of a 30-year loan.

Rate Shopping Pays Off Big Time

According to LendingTree’s data, comparing offers on a 30-year fixed-rate mortgage can save borrowers approximately $80,024 over the full term. That breaks down to around $222 per month or $2,667 annually a meaningful amount that could be redirected toward savings, investments, or other financial goals.

LendingTree’s chief consumer finance analyst, Matt Schulz, emphasized the impact: “It’s a substantial amount of money. Those savings can go a long way, whether toward retirement, a child’s education, or just easing the strain of daily expenses.”

Interestingly, the savings potential has grown. Last year, the same analysis showed average savings of $76,410, meaning that rate shopping could now yield over $3,600 more than it did a year ago.

Where Borrowers Save the Most

Unsurprisingly, buyers in states with higher home values stand to gain the most from shopping around. The top three states with the biggest potential mortgage savings are:

• California – $118,393
• Washington – $109,012
• Hawaii – $105,473

In these states, a small drop in interest rates can translate into massive long-term savings simply because loan sizes are larger. But even in less expensive markets, rate shopping can still deliver real benefits. In Louisiana, for instance the state with the lowest potential savings borrowers can still save around $44,000 over 30 years, trimming monthly costs by $124.

Why Mortgage Rates Vary So Widely

The main reason for such significant savings lies in the broad differences in rates offered by lenders. Nationwide, the average spread between the lowest and highest available APRs is nearly 1 full percentage point (0.99%). That margin is even wider in some places. For example:

• Minnesota – 1.15% average spread
• South Dakota – 1.14% average spread

That difference adds up quickly. For every $100,000 borrowed, the savings can exceed $24,000 over 30 years, simply by opting for the lender offering the best rate.

And while borrowers with excellent credit have more negotiating power, it’s important to note that even well-qualified applicants often receive very different offers from different lenders. That’s why comparing multiple lenders is critical.

Borrowers Want Lower Rates But Often Don’t Look Far

A report from Intercontinental Exchange’s Mortgage Monitor sheds light on borrower behavior. It found that 72% of homebuyers ranked interest rate as their top priority when choosing a lender. Yet despite this, most borrowers only consider one or two lenders, and less than a quarter stay with their previous lender, even though two-thirds say they would.

This disconnect suggests a significant opportunity for both borrowers and lenders. Borrowers who take the time to compare offers can unlock huge financial benefits. Meanwhile, lenders that lead with competitive offers and act quickly may win business in a highly competitive market.

The Takeaway

With mortgage rates still relatively high and home prices offering little relief, every dollar counts in today’s housing market. Simply shopping around for a better mortgage rate could save homebuyers tens of thousands of dollars over the life of their loan.

So, whether you’re a first-time buyer or considering refinancing, don’t settle for the first quote. Comparing multiple offers isn’t just smart it could be the key to making homeownership significantly more affordable. For learn more about financing Visit Nadlan Capital Group.