Borrowers in California are most likely to save the most by shopping for mortgage rates according to a recent study by LendingTree that assessed how much consumers can save by comparing mortgage rates in their city. Fifty cities featured in this analysis, which found that borrowers in Tampa Florida; Kansas City, Montana; Portland, Oregon; and New York, New York got the biggest rate savings by comparing competing offers.
For borrowers in San Francisco, comparing rates meant that they could potentially save $254 per month on a home with a median price of $900,000. In less expensive cities like Detroit too, consumers could save as much as $9,952 in lifetime interest savings on a home with a median price of $150,000, the study revealed. Tulsa, Oklahoma was another city that joined Detroit in cities where borrowers saved below $10,000 over the life cycle of a loan if they compared rates at the beginning.
The study also found that cities with fewer bank branches per capita had wider refinance indexes. For this study, LendingTree used median values so half of the borrowers would see smaller savings and the other half would see more. "There is no way for a borrower to know where they fall in this spectrum without shopping around, so it is imperative to compare lenders and assess their offers," LendingTree said.
Among metros where purchase loan borrowers faced the largest differences in purchase mortgage rates, the study revealed that consumers in Tampa, Florida could save $67 in monthly payments adding up to $809 per year on homes with a median price of $225,000. The study calculated their lifetime savings at $17,291. Similarly, in Kansas City, borrowers could save $59 per month or $705 per year on a median-priced home of $197,800, while those in Portland saved $983 per year on a median-priced home of $276,000.
Apart from San Francisco, borrowers in Los Angeles, San Diego, Seattle, Boston, Denver, New York, Washington, D.C., Sacramento, and Miami stood to save the most money in lifetime interest expenses.
When it came to refinancing loans borrowers in New Orleans, Salt Lake City, and Indianapolis faced the largest difference in refinance mortgage rates.