What’s behind this gender rate gap?
Trina Patel, a financial advice manager at finance app Albert, told Insider that the gender pay gap could contribute to higher interest rates.
“Women are typically in fields that earn less than men, or they earn less than men. The amount of wealth that they can build is going to be slightly at a disadvantage. If you’re earning less, by default, you might not be able to save as much for a future down payment,” she said. A lower income could also mean a higher debt-to-income ratio, another major factor in what a buyer pays for a mortgage.
How to get a lower mortgage rate
“One thing we do know, that is universally a problem for women and men, is the fact that the majority of people in the United States do not shop for their mortgage,” said Patrick Boyaggi, CEO of Own Up.
The experts agree that the best way to avoid overpaying is simple: shop around for a mortgage. “Don’t accept the first offer presented to you by the first lender you’re introduced to,” Boyaggi said. Compare all parts of the offer, from the interest rate to the closing costs and fees. Once you have a feel for what lenders have to offer, don’t be afraid to negotiate.
Once you’ve signed for your home, there could still be ways to lower your interest rate. Opendoor consumer trends expert Beatrice de Jong says that refinancing could help. “Record-low mortgage rates can translate into lower costs for borrowers looking to refinance,” she told Insider by email. “With current rates as low as they are, it’s likely that your new rate would be low enough to make refinancing worth your while.”