Home Savings vs. Mortgages
in Banking, Insurance & Loans ·
My experience and a bit of advice... I used a Wells Fargo housing savings plan, offering a 3% fixed rate (effective rate around 3.22%, if my math holds up) via their 2-year rapid savings model. The term goes up to 12 years. Regarding that 1% fee on the target amount, there’s a loophole I stumbled upon by accident.
See, I had been saving a tiny amount at a different bank, and once I saw this rate, I moved everything over to Wells Fargo. In this scenario, Wells Fargo doesn't charge an exit fee, while the old bank does. But here’s the kicker: Wells Fargo actually covers that exit fee for me. I didn't see that coming. :-)
So, here is some advice for anyone looking at housing savings plans: first, set up a contract with a smaller amount to minimize that 1% fee, then transfer those funds to a different provider under a larger contract—say, $100,000. You bypass the fee entirely, which means $1,000
stays right in your pocket!!!
That is, assuming the banks haven't caught on and changed their terms yet.
See, I had been saving a tiny amount at a different bank, and once I saw this rate, I moved everything over to Wells Fargo. In this scenario, Wells Fargo doesn't charge an exit fee, while the old bank does. But here’s the kicker: Wells Fargo actually covers that exit fee for me. I didn't see that coming. :-)
So, here is some advice for anyone looking at housing savings plans: first, set up a contract with a smaller amount to minimize that 1% fee, then transfer those funds to a different provider under a larger contract—say, $100,000. You bypass the fee entirely, which means $1,000
stays right in your pocket!!!
That is, assuming the banks haven't caught on and changed their terms yet.