Borrower’s Remorse

Nearly two-thirds of millennials have new homebuyer regrets, survey finds

Mortgage Banker Magazine
A new homebuyer stands in their home, regretful of their purchase.
Millennials have the most regrets after buying a home.

Worries About Getting The Best Mortgage Rate

Millennials were also the most likely to say they didn’t get a good mortgage rate, or that they overpaid for property. For example, 12 percent of millennials said their rates were too high, and 13 percent said they agreed to a sale price that was more than it should have been.

Although mortgage rates are near historic lows, it remains important to shop around for the best offer. Even a few basis points difference in interest can mean a savings (or extra cost) of thousands of dollars over the life of your loan.

According to a study Freddie Mac conducted in 2018, a borrower who got one extra rate quote saved an average of $1,435 over the life of a typical $250,000 mortgage. Moreover, 80 percent of those borrowers saved between $966 and $2,086 by shopping around with one additional lender. The more you shop around, the more savings you rack up. Borrowers who got five rate quotes saved $2,914 — on average — with 80 percent of those shoppers who got five quotes saving between $2,089 and $3,904.

Remorse Over The Home Itself

While financial frustrations topped the list of regrets for new homebuyers, many survey respondents said they also came to realize their new place was literally not the right fit.

Millennials again were the most likely to be unhappy with their new home’s physical characteristics. According to the survey, 15 percent of respondents from that generation said they disliked their new property’s location. Meanwhile, around 30 percent felt the home was not the right size.

“Because the market is so competitive, you have less time to make a decision on a homebuying purchase than you do on a laptop at Best Buy,” said Olmsted. “You’ve already had, possibly, a couple of offers not accepted, you feel that pressure to make a decision and put an offer in.”

Mortgage Banker Magazine
This article was originally published in the Mortgage Banker June 2021 issue.
Published on
Jun 01, 2021
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