TMCnet Feature
September 30, 2021

Mr. Cooper Prioritizes App Design, Function, and Customer When it Comes to Mortgages and Savings

Homeowners have the potential opportunity to take advantage of considerable savings every year through strategies such as refinancing and keeping tabs on rates, equity, and more. According to one survey, less than one-fifth of homeowners reported that they refinanced their pre-pandemic mortgages even though rates considerably fell thereafter. Furthermore, almost half of all respondents reported that they were not even considering refinancing their mortgages. This is a truly surprising fact given the record-low interest rates at present in the market.

Mortgage rates have indeed risen slightly since first reaching all-time lows last year. However, these rates are still well below the averages of years past, and refinancing rates are also unusually low, as much as below 3% and even as low as 2%.

The survey also found that almost two-in-five homeowners with a mortgage were not aware of what their current interest rate was. This indicates a failure on many levels to reach out to, educate, and assist homeowners with money-saving strategies that they can benefit from in the long run. While one may expect the average homeowner to know that they should follow interest rates and other basic metrics to know whether they can benefit from refinancing, most do not. Mortgage company Mr. Cooper is providing valuable money-saving services to such owners by giving them the information they need to make smart, data-driven financing decisions.

Over half of the millennials included in the survey did not know their mortgage rates, while about 17% of Gen Xers and baby boomers reported refinancing their pre-pandemic mortgages.

A rule of thumb is that if interest rates are half a percent or more below the rate you are paying, you may be able to profit by refinancing.

Since home prices have risen substantially over the last year or so, refinancing can generate considerable savings per month. Many homeowners choose to use their refinancing savings on home improvements, consolidating debt, paying bills and tuition, and dabbling in other investments.

Most of those surveyed stated that they expected their savings to be trivial, which is why they did not refinance. Others stated that the high closing costs and fees required for refinancing prevented them from looking at alternatives to their current mortgage.

Mr. Cooper understands the importance of reaching customers where they are, providing them with the tools they need to make smarter decisions, and proactively helping their customers every step of the way. They also understand that poor design, process functions, and customer awareness are the root cause of many of these issues. This is why they have invested in data-driven apps, a world-class finance team, and a thriving, customer-centric culture to help them deliver value to their customers and their families every step of the way, from finding a mortgage to closing on a new home and refinancing when it makes sense to do so.

Getting Your Mortgage Right

Part of the process is educating customers about what to do – and what not to do – when shopping for a mortgage. Here are a few recommendations and insider strategies from the Mr. Cooper team on getting the best mortgage possible for your home.

1. Never borrow more than you can comfortably afford.

Do not overstretch or overburden yourself with a mortgage that you cannot comfortably pay off. Doing this can increase the risks of foreclosing and it can also make it harder to purchase items you need for your home, from furniture to appliances to maintenance services. This can lead to a devaluation of your home due to wear and tear – not to mention the added stress and discomfort of living day-to-day in a home that is uncomfortable and with the worry of where your next payment will come from.

Your mortgage budget should include your monthly principal, interest on your mortgage, and taxes and insurance. Before signing any paperwork, consider going through a practice run in which you set aside the money you need for your mortgage for a few months to see how easy or difficult it is to hit those limits.

2. Increase your down payment.

If you can, make a 20% down payment. With that amount, you will more likely be able to work with a wider network of lenders. You may also be able to avoid private mortgage insurance, or PMI, which is added to your monthly bill even though you do not receive any insurance coverage from it. PMI is designed to protect the lender from losing money if you foreclose.

About Mr. Cooper Mortgages

Mr. Cooper wants you to be well-informed about your options. This is why the lender offers free, fast, no-obligation Mortgage Checkups. This service makes it easy for you to identify potential savings opportunities.

Please visit their convenient checkup tool to calculate:

  • Current interest rates, payments, and terms
  • Possible new refinancing rates or term reductions
  • Potential refinancing savings
  • Equity analysis
  • Potential cash-out options
  • FICO® credit score for primary borrowers

User education, powerful tools, and customer service are some of the key offerings of Mr. Cooper mortgages, so contact them today to learn more about how they can help you potentially save with your home financing or refinancing.

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