Women on average tend to be less aware than men of the various mortgage options they have when it comes to applying for a home loan. As a result, they often end up paying thousands of dollars more, according to a new LendingTree study that tracked data from the Consumer Financial Protection Bureau.
The study found that female first-time buyers and repeat borrowers tend to be less familiar with the mortgage application process. There are some big disparities between men and women first time buyers when it comes to their familiarity with mortgage rates and the various loan options on offer, the study found.
“It seems women are paying a higher price to access homeownership than they should,” researchers note in the study.
But although females are less familiar with their options, the study found that in fact, men too could still benefit from improving their knowledge. For example, 45% of women said they considered more than one lender when shopping around, compared to 51% of men. Studies show that the more people shop around, the greater savings that can be had. And these savings can potentially add up to thousands of dollars over the 30-year lifetime of a typical mortgage.
Single women accounted for about 20% of the 7 million home sales in 2018, and researchers say they may have overpaid by more than $1 billion because of failure to shop around for a mortgage. Extra costs for men, according to the study, are about half of that for women, they said. “Understanding home buying and mortgages can be a little daunting, but getting educated about the process can greatly improve a borrower’s experience—and potentially save them substantial sums of money,” researchers note in the study.