How to Save Money Buying a House: Seven Real Levers
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The biggest ways to save money buying a house are a commission rebate, shopping your mortgage, negotiating seller credits, cutting the taxes you can, and using first-time buyer programs. On a $1 million home, the rebate alone can be $10,000 to $20,000. Most other guides only tell you how to save for the down payment.
We represent buyers and rebate part of our commission, so we have a stake in one of these. We’ll be clear about which. The rest are levers anyone can pull.
The short version: most guides tell you how to save for the house; this one is about spending less on it.
| Lever | Rough value on a $1M purchase |
|---|---|
| Commission rebate | $10,000 to $20,000 |
| Shopping the mortgage | $1,500 to $3,000 over the loan |
| Seller credit toward costs | Up to 3% to 9% of the price, if negotiated |
| First-time buyer assistance | $15,000 to $100,000, program-dependent |
| Dropping PMI on time | 0.5% to 1% of the loan per year |
The commission rebate: the lever nobody lists
It’s the biggest check on the list, and it’s the one nobody mentions. Chase, HomeLight, and the rest skip it entirely.
Here’s how it works. On a resale, the seller pays a commission that covers both agents. In New York and about 40 states, your agent can return part of the buy-side share to you.
It’s legal under Section 442 of the Real Property Law. The Department of Justice has called rebate bans a policy that “artificially inflates the cost of real estate services,” and the IRS treats a rebate as a price cut, not income.
The amount is real money. The buy-side commission averages about 2.5% of the price. A rebate of half that on a $1 million home is roughly $12,500. See what NestApple returns to buyers and how a real estate agent rebate reaches you at closing.
Shop the mortgage, not just the house
One extra phone call is worth about $1,500. Freddie Mac’s research found that getting one additional rate quote saves a typical borrower around $1,500 over the life of the loan. Five quotes bring the average savings to nearly $2,900.
Two things make this work. Your Loan Estimate is a standardized form, so you can compare lenders line by line. And you’re allowed to shop separately for title, survey, and settlement services, which the lender has to list for you.
Seller concessions and credits
The seller would rather credit you than drop the price on the listing. A price cut is public and sets a comp. A closing credit is a contract term nobody else sees.
You can ask the seller to credit money toward your closing costs as part of the offer. Fannie Mae caps these interested-party contributions at 3% to 9% of the price, depending on your down payment. About a quarter of sellers offered a concession in 2024, so it’s a normal ask.
Our page on buyer broker compensation covers how a credit toward your agent’s fee works alongside this.
Cut the taxes you can
You can’t dodge the mansion tax, but you can stop agreeing to the seller’s. In NYC, the buyer pays the mansion tax on homes priced at $1 million or more, starting at 1% and increasing with price. The seller pays the city and state transfer taxes.
The place to push back is new development. Sponsors routinely ask the buyer to pay the sponsor’s transfer taxes, which amount to roughly 1.4% to 1.8% of the price. That’s negotiable, and an attorney who reviews offering plans will flag it.
In New Jersey, the mansion tax shifted to the seller in July 2025, and there’s no exemption below $1 million. Run your deal in our closing-cost calculators.
First-time buyer programs
The city and state are handing out down payments, and the forms are the only catch. NYC first-time homebuyer assistance comes from three places.
- SONYMA (New York State). A below-market mortgage plus a Down Payment Assistance Loan: 0% interest, no monthly payment, forgiven after 10 years, up to $15,000, or up to $30,000 under DPAL Plus.
- NYC HomeFirst. Up to $100,000 toward down payment or closing costs for eligible first-time buyers.
- NJHMFA. Up to $15,000 forgivable after five years, plus $7,000 for first-generation buyers.
All have income and purchase-price limits and require a homebuyer course. They can stack with a commission rebate.
Drop PMI as soon as you can
The insurance that protects your lender, billed to you, has an off switch. If you put down less than 20%, you pay private mortgage insurance, roughly 0.5% to 1% of the loan a year.
Federal law requires the lender to cancel it automatically once you reach 78% loan-to-value. You can request cancellation at 80%. Track your balance and ask; it won’t happen on its own the day you qualify.
What we tell our buyers
Run the whole thing through a calculator before you fall in love with a kitchen. Price the rebate, the mortgage options, the taxes, and any program you qualify for, then look at homes.
The rebate is the one we’re paid to mention, so weigh it accordingly. But the mortgage shopping and the PMI timing cost you nothing and add up. This page is part of our guide to NYC commissions and rebates.
Common questions
What’s the single biggest way to save money buying a house? For most buyers, it’s the mortgage rate, followed by a commission rebate where it’s allowed. On a $1 million home, each can be worth $10,000 or more.
How much can shopping for a mortgage save me? Freddie Mac found that one extra rate quote saves about $1,500 over the loan, and five quotes save close to $2,900 on average.
How do I ask for seller concessions? Include a credit toward closing costs as a term of your offer. Fannie Mae caps it at 3% to 9% of the price depending on your down payment, and about a quarter of sellers offered one in 2024.
Who pays the transfer tax in NYC? The seller pays the city and state transfer taxes. The buyer pays the mansion tax on homes of $1 million or more, and often the sponsor’s transfer taxes on new construction, which are negotiable.
Nicole Fishman Benoliel co-founded NestApple in 2017. She's a lawyer admitted to the New York bar - her law degree is from La Escuela Libre de Derecho in Costa Rica, with further study at IE Business School in Madrid and an LLM from Fordham in New York. She does not act in a legal capacity at NestApple; every client is referred to an attorney who handles real estate deals full time.
