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Apr

2025

How Long Do College Refund Checks Take? How the Process Works

By Melissa Brock | Going to College, Student Loans, student_loan | Comments Off

For college students, few things are more welcome than extra money. And surprisingly, those additional funds might be from your school in the form of a college refund check.

Colleges sometimes issue refunds to students, and the amount can be thousands of dollars, depending on your situation.

Are you eligible for a refund from your college, and if so, how long does it take to get your money? Read on to learn more about college refund checks.

Key Points

• Financial aid that exceeds tuition and fees can result in a college refund check for students.

• College refund timelines vary by school, typically taking several days to two weeks.

• Submitting a late or incomplete Free Application for Federal Student Aid (FAFSA) can delay a college refund.

• Refunds may be issued as paper checks, direct deposits, or credits to student accounts.

• College refunds can be used to start paying off student loans or other debt, or the money can be applied to next semester’s tuition.

What Is a Refund Check From a College?

A refund check is typically issued by your college or university when your financial aid covers more than what you owe for tuition, room, board, and fees. Here’s how that can happen: When you receive financial aid, the aid amount is based on your college’s cost of attendance (COA). The COA is an estimated amount, however, and sometimes the actual price turns out to be less than the amount you may have been awarded in scholarships and borrowed through student loans. In that case, your school sends you a refund check.

For example, let’s say you received $15,000 in aid for the semester, but your school’s tuition and fees were $12,000. In this case, you’d get a $3,000 refund.

When you are owed a refund check, your college or university may send you a paper check in the mail, directly deposit the money into your bank account, or credit your school account (the credit can be applied for the next semester’s tuition or other school-related expenses).

Although it’s exciting to get money back, student loan refunds are typically not free money. Unless the refund comes from leftover funding from a grant or scholarship you received, these funds are likely to be part of the student loan you borrowed, and they will need to be repaid with interest. So it’s important to use your refund wisely.

Refund Check Process

The process for getting a refund check varies from school to school, but this is typically how it works:

1. Financial aid is disbursed at the beginning of the semester. This is when federal student loan funds, grants, scholarships, and private student loans are sent to your school and applied to your tuition, room, board, and fees. To make sure your disbursement happens promptly, register for all the classes required to get your financial aid, and sign the Master Promissory Note (MPN) for your federal Direct subsidized and unsubsidized student loans.

2. Your school should notify you when the disbursement happens. If there is money left over after that, your school will issue a refund.

3. You may receive a paper refund check or the money may be directly deposited into your bank account (you can sign up for direct deposit through the online portal for your school account). The refund might also be credited to your college account, in which case it won’t be sent to you. Instead, the credit will be applied to future school costs like tuition.

College Refund Check Dates

Schools typically disburse financial aid at the beginning of a semester. After they disburse your funds, if they determine that you are owed a refund, they will start the refund process. The time it takes to receive a college refund check varies from school to school. Some schools issue refunds within several days; others take 14 days. Contact with your college’s financial aid office to find out the timeline.

For freshmen, the college refund check process may take longer. First-year undergraduates who are taking out student loans for the first time may experience a 30-day delay after the first day of the school’s waiting period before their college disburses their loan funds. Not every school uses this 30-day rule, though, so check with your school to find out.

College Refund Check Status

To check on the status of a college refund, log into your school account through the online portal to see if the refund is noted on your account. If it is, but there’s no information listed about how long the refund might take, contact the school’s financial aid office to inquire about the status of your refund check.

Refund Check Problems

If you believe you are owed a refund but the money hasn’t landed in your account, there may have been a snafu. Some possible reasons a college refund check could be held up include:

• Late paperwork. If you filed your Free Application for Federal Student Aid (FAFSA) late or you waited to apply for student loans, you might experience a delayed refund check. The financial aid office at your college or university may be able to give you an update on the status of your refund and when you might expect it.

• Incorrect paperwork. If you forgot to complete a section of your paperwork or missed a signature on your financial aid forms, this could delay the process. Fix the mistakes and submit the correction, then double check with the school’s financial aid office to make sure everything is in order.

• Regular processing delays. It takes time for colleges and universities to implement financial aid disbursements and then to pay out any necessary refunds, especially at the busy start of the school semester. These may just be normal delays, but of course it doesn’t hurt to contact the school to find out.

When Will I Get My College Refund Check?

The dates for refund checks vary by the school and their financial aid disbursement process. The type of aid you’re being refunded for may also factor into the equation.

For example, in 2025, Jackson College in Jackson, Michigan, mailed or deposited Pell Grant check refunds on September 13. Loans, however, were disbursed by the school in two waves. For the first loan disbursement, refunds were sent on October 4, 2024. For the second disbursement, refunds go out on November 1.

As you can see, how a school handles this process affects when you’ll receive a refund. Every school’s dates and processes are different, so check with your college to find out the specifics.

Do I Get a Refund Check Every Semester?

You might get a refund check every semester you’re in college, but it depends. You must submit the FAFSA each year, which could affect the amount of aid you receive. That, in turn, can determine whether or not you receive a refund.

Recommended: Student Loan Forgiveness Guide

What Is the Average College Refund Check?

A college refund check might be hundreds or thousands of dollars. The refund amount depends on a variety of factors, including your school’s estimated COA versus the true cost. Other factors include the type of financial aid you receive and how much you get. Each student’s situation is unique.

And remember, a bigger refund is not necessarily better. If the refund is from loan funds, you’ll have to repay that money eventually, along with the rest of your student loans. A student loan payment calculator can help you figure out how much you might owe and help put things in perspective.

Things to Do With a College Refund Check

Getting a college refund check is exciting, and you may be tempted to spend the money on a vacation or some new clothes. However, since those funds are supposed to be for your education — and you may very well have to repay it — think carefully about how you spend it. Some ideas include:

• Start paying your student loans. You can begin repaying your student loans anytime — you don’t have to wait until the six-month grace period after you graduate. Making payments on your loans now could give you a head start on getting out of student loan debt.

This is especially true if you have loans that accrue interest while you’re in college, like federal Direct unsubsidized loans. Depending on the federal student loan interest rates, the amount of interest you might accrue over time may be substantial if you don’t begin paying them off. You can even just pay down the interest amount.

• Put the money toward your tuition bills. You can allocate a college refund to next semester’s tuition. You might also use it for other education-related expenses, such as books or supplies.

• Pay off other debt. Another option is to use the money to help pay off high-interest debt, such as credit card debt. With interest rates of approximately 24%, this type of debt can add up quickly if you don’t begin tackling it.

• Return the refund. You don’t have to accept a college refund check. If the money is from federal student loans, you can send it back to the Department of Education, which could help reduce your student loan debt. As long as you return it within 120 days, you won’t pay interest or fees on the sum. To return the refund, call your college’s financial aid office to see if they can help. If they are unable to, contact your loan servicer.

Recommended: Student Loan Debt by Major

The Takeaway

You may be eligible for a college refund check if your financial aid amount was more than the actual cost of your tuition, room and board, and other fees. The check may be mailed to you or deposited directly in your bank account, or the amount may be credited to your college account for future school costs. The length of time it takes to receive a college refund depends on your school, among other factors, and it generally takes between several days to two weeks.

One way to use a college refund is to start repaying your student loans, especially if interest is accruing on the loans while you’re in school. And keep this in mind: If the interest rates on your student loans are high, one option is to refinance student loans later on for a lower rate and better terms, if you qualify. Just be aware that refinancing federal loans makes them ineligible for federal benefits, such as income-driven repayment.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

About the author

Melissa Brock

Melissa Brock is a higher education and personal finance expert with more than a decade of experience writing online content. She spent 12 years in college admission prior to switching to full-time freelance writing and editing. Read full bio.

Photo credit: iStock/Drazen Zigic

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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Apr

2025

Divorced Parent’s Guide to Paying for College Tuition

By Melissa Brock | Going to College, Student Loans, student_loan | Comments Off

Divorce brings about many challenges, one of which is figuring out how to finance your child’s college education. College tuition is a significant expense — approaching $40,000 per year, on average — and the financial dynamics between divorced parents can add complexity to an already difficult decision-making process.

Understanding your options, obligations, and available resources is crucial for ensuring your child’s educational future is secure. Here, we’ll explore how divorced parents can approach paying for college tuition, including understanding legal obligations, navigating financial aid, and collaborating together to achieve the best outcome for their child.

Understanding Legal Obligations for College Payment

It’s important to understand your legal obligations when it comes to paying for college, particularly in connection with child support and divorce decrees. It’s also important to note that the FAFSA® guidelines for divorced parents have changed. Rather than using the financial information of who the child lived with the most, the FAFSA will use the information from the parent who provided the most financial support. Let’s take a look.

Child Support and College Expenses

Divorce settlement agreements often address who will pay for college, which is separate from child support.

What exactly is child support? When parents get divorced, it’s common for the parent who does not have custody to pay child support, which usually translates to financial support for minor children. Parents can stop making child support payments when a child turns 18 and the child graduates from high school (unless the child is still in high school and cannot support themselves).

In some cases, one parent may also be required to pay for college, as well. Educational expenses typically get addressed during the divorce process, so you’ll know your exact responsibilities regarding your child’s college education. However, your obligation will depend on your state’s laws.

Some states may order divorced parents to help pay for college-related expenses, while others view them as conditional expenses. The following states allow courts to order non-custodial parents to help pay for college:

• Alabama

• Arizona

• Colorado

• Connecticut

• Florida

• Georgia

• Hawaii

• Illinois

• Indiana

• Iowa

• Maryland

• Massachusetts

• Mississippi

• Missouri

• Montana

• New Jersey

• New York

• North Dakota

• Oregon

• South Carolina

• South Dakota

• Utah

• West Virginia

• Washington

• Washington, D.C.

Divorce Decrees and Education Provisions

A divorce decree refers to the legal paperwork that formalizes the end of a marriage and outlines the binding terms after a divorce. It outlines child support and other factors, including education provisions. A divorce decree should also identify who will pay for college preparation and college itself, which can include:

• Standardized tests

• Admission applications

• College visits

• Tuition

• Room and board

• Required college fees

For example, one parent may be required to pay for room and board, while the other parent may pay tuition. You may also want to consider an appropriate cap on these expenses, considering the rising costs of college and the length of time it can take students to complete their degrees.

Keep in mind, too, that parents are not required to pay for their child’s college education. College students can rely on cash savings, scholarships, and both federal and private student loans to cover the cost of college.

Strategies for Tuition Cost-Sharing Between Parents

Let’s take a look at some strategies for how to pay for college for divorced parents, from negotiating contributions to making proportional payments based on income.

Negotiating Contributions

It’s important to review your financial situation together, consider the resources each parent can draw from, and figure out which types of expenses to cover. It’s best to create a written plan using an attorney or mediator to outline how you’ll manage college costs. The financial situation of each party should dictate a customized plan.

It’s important to note that when splitting costs, you may not be able to divide costs right down the middle (though splitting it 50/50 might make sense if both parents have a similar income and educational values). For example, your ex may not agree on the necessity of studying abroad or expensive curtains for a dorm room. Since those expenses aren’t “necessary,” either the parent who wants to pay for them can, or the student can be responsible for paying for non-essential expenses on their own.

Proportional Payments Based on Income

Those undergoing divorce often agree to split college expenses based on income. If one partner has a significantly smaller income than the other, the income disparity may be taken into account. For example, if one parent makes 80% of the combined income, that parent would be responsible for 80% of college costs and expenses.

Maximizing Financial Aid Eligibility

To qualify for financial aid, students must fill out the Free Application for Federal Student Aid, or FAFSA. For divorced or separated parents, the FAFSA process may differ from that of married parents.

Reporting Divorced Parent Information

The FAFSA is a free application that students can use to apply for federal, state, and institutional aid. Every family should file the FAFSA, and how you fill it out depends on whether you and your ex live together or not.

You answer questions on the FAFSA about the parent who provided more financial support that year. If that parent has remarried, the stepparent’s financial information will also be required.

The parent’s income and assets are used to calculate the Student Aid Index (formerly the Expected Family Contribution), which determines the student’s eligibility for federal financial aid. The parent who provided the least financial support is not required to put their financial information on the FAFSA, but it may be needed for other financial aid applications, such as the CSS Profile, which some private colleges require.

If you’re divorced and live together, you’ll add “unmarried and both legal parents living together” and answer questions about both of them on the FAFSA. Note that if you are separated from your spouse but still live together, you’ll indicate your marital status as “married or remarried,” not “divorced or separated.”

Special Circumstances Considerations

If you get divorced during the middle of a school year, you may want to submit a special circumstances form through the financial aid office of the school your child attends. The financial aid office may take a divorce into consideration and readjust your child’s aid award due to your financial situation. Anytime you experience a change in income or assets, notify the admissions office immediately.

Loans and Financing Options for Divorced Parents

Even with financial aid, scholarships, and savings, many families find they still need additional funds to cover college costs. Several financing options are available to help bridge the gap, including:

• Federal Parent PLUS Loans: Parent PLUS Loans are available to parents of dependent undergraduate students. They offer a fixed interest rate and flexible repayment options. However, they require a credit check, and parents are responsible for repayment.

• Private Student Loans: These loans are offered by private lenders and can be used to pay for college costs not covered by financial aid. Interest rates and terms vary, and a cosigner may be required.

• Home Equity Loans or Lines of Credit: If you own a home, you may be able to tap into your home’s equity to help pay for college. These loans often have lower interest rates than other types of loans, but they put your home at risk if you can’t repay.

• Payment Plans: Many colleges offer payment plans that allow you to spread tuition payments over the course of the year. This can make payments more manageable without accruing interest.

Tax Implications and Benefits

Fortunately, there are tax benefits to paying for college, beginning with claiming your student as a dependent.

Claiming the Student as a Dependent

Claiming a student as a dependent can save you thousands on your taxes. You can claim a college student as a dependent on your tax return as long as the student is younger than you, under age 24, and a full-time student for at least five months of the year.

Education Tax Credits and Deductions

Worried you can’t afford a child’s college bills? Don’t forget that tax credits and other tax benefits can offset the qualified costs of college or career school (tuition, fees, books, supplies, equipment). These benefits include:

• American Opportunity Credit: The American Opportunity Credit allows you to claim up to $2,500 per student per year for the first four years of school your child is in school.

• Lifetime Learning Credit: The Lifetime Learning Credit allows you to claim up to $2,000 per student per year for tuition and fees, books, supplies, and equipment.

• QTP/529 Plan: If you contribute to a QTP/529 plan to prepay or save for education expenses, you can withdraw the money you put in, tax-free.

• IRA Withdrawals: If you take money from an individual retirement account (IRA), you owe federal income tax on the amount you withdraw, but not the withdrawal penalty.

Communicating and Collaborating with Your Ex

Effective communication with your ex-spouse is key to successfully navigating college financing. Even if your divorce was contentious, it’s important to set aside differences and focus on what’s best for your child. This includes discussing financial responsibilities, coordinating on financial aid applications, and agreeing on a plan for covering any remaining costs.

It’s also important to involve your child in discussions about financing their education. Be open about the costs, what you and your ex-spouse can contribute, and what they may need to cover through scholarships, work-study programs, or student loans. This helps set realistic expectations and encourages your child to take an active role in their financial future.

The Takeaway

Paying for college can be a daunting task for divorced parents, but with careful planning, communication, and collaboration, it’s possible to navigate the challenges successfully.

You should start by understanding the legal obligations and exploring all available financial aid options. Work together with your ex-spouse to create a plan that works for both of you, and involve your child in discussions about financing their education.

Options for paying for college as a divorced parent include splitting the cost with your ex based on each of your incomes, having your student apply for scholarships, and relying on both federal and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

How is the expected family contribution calculated for divorced parents?

The expected family contribution (EFC) has been revamped to become the Student Aid Index (SAI) through the FAFSA Simplification Act. The SAI evaluates the financial resources that a student may contribute toward educational expenses. Because of the FAFSA Simplification Act, the parent who provided the most financial support during the year is the income that will be used to determine the SAI.

What if one parent refuses to pay for college?

Parents — married or divorced — are not obligated to pay for college. Child support might terminate when the child reaches the age of majority (such as 18 or 21), and students enrolled in a postsecondary educational institution might have to access financial support through college. Check with a family law attorney licensed in your state to give you guidance about who may be obligated to pay for college.

Can stepparents be required to pay for college tuition?

Stepparents are usually not required to financially support stepchildren, but in a few instances, family court may require a stepparent to pay financial support for a stepchild. Various factors may come into play, including the length of the marriage, relationship between stepparent and stepchild, existing financial support, and more.

About the author

Melissa Brock

Photo credit: iStock/FG Trade

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

SOISL-Q324-031

Apr

2025

Reasons for a Denied Personal Loan

By Melissa Brock | Family Finances, personal_loan | Comments Off

There are several reasons why you might be denied a personal loan, ranging from a lower credit score or income than required to incorrect information on your application. No doubt about it, though: Being denied for a denied personal loan can add stress to your life when you expect money to come through.

Follow this guide to understand why personal loans are rejected and how to help improve your approval odds in the future.

Why Was My Personal Loan Rejected?

Here are some common reasons financial institutions reject personal loan applications. Any one of these, or a combination of factors, could lead to a personal loan application being denied.

• Low income: Lenders may worry about your ability to repay a loan if your income is too low. However, most lenders don’t publish their requirements, nor do they always set specific cutoffs. In other words, it can be hard to know what earnings you need to show to secure a personal loan.

• Variable income: If you don’t always have a predictable income (as may be the case with entrepreneurs, freelancers, and seasonal workers), a lender might also have concerns about your ability to repay your loan.

• Unsteady work history: Another reason that lenders may feel you are not a good candidate for a personal loan is if you are in and out of the job market. For instance, a person who has been steadily employed at $60,000 per year could be perceived as more credit-worthy than someone who earned $100,000 for one year, was unemployed for six months, and then employed at $65,000 for nine months.

• Low credit score: Your credit score can be one of the most important factors on a personal loan application. A poor credit score (below 580) can mean you’ve had difficulty repaying your loans on time (or at all) in the past, so a lender may deny your personal loan application. (Or, if approved, you may wind up with a higher interest rate on your loan than someone with a stellar score.) You can see if a prospective lender shares what credit score you need for a personal loan before applying to save time and energy.

• High debt-to-income ratio: Your debt-to-income (DTI) ratio is the amount of debt you carry relative to your income. You can determine yours by adding up all your monthly debt payments and dividing that by your monthly income. Multiply that number by 100 to see if it comes in at no more than 43%, which many lenders use as a qualification. The lower your number, the better.

• Incorrect application information: Your application may include erroneous information, such as accidentally mixing up digits on an account number. This might be an easy fix when you reapply for your personal loan.

• Not meeting lender requirements: It’s a good idea to ensure you meet all lender requirements before you apply for a personal loan, which at the basic level include having U.S. citizenship or permanent residency, government-issued ID, a Social Security number or individual taxpayer identification number, proof of income, and being at least 18 years of age.

• Requested too much money: You may have requested more than the maximum amount your lender was willing to lend to you. They take into consideration the amount you can comfortably afford to repay based on your income and DTI.

• Incomplete application: You may get denied simply because you didn’t complete your paperwork when applying for a personal loan. If so, next time around, consider going over your application extra carefully.

• Loan purpose didn’t match lender criteria: Lenders often impose restrictions on how you use your loan. If you intend to use a personal loan as a student loan, for example, the lender may have restrictions against that and deny your loan application.

By the way, it’s worth noting that even if you were preapproved for a personal loan, you might still ultimately be denied. Here’s why: The preapproval process may not give your lender the full information they need to definitively approve the loan.

Recommended: Personal Loan Guide for Beginners

What to Do After You’ve Been Rejected for a Loan

If your personal loan application has been rejected, the lender must share what’s known as an adverse action notice, which reveals which information was used to make this decision. This can point you in the right direction about what may have triggered the denial and help guide you toward getting a personal loan in the future.

You might also check with your lender directly to find out why. If the rejection was due to an error on your application, you could potentially apply again and correct that mistake. (Check with your lender about any waiting period before reapplying.)

Can You Improve Your Loan Approval Chances?

If you were rejected for a personal loan, here are some ways you can improve the odds of being approved in the future.

Finding a Cosigner

Your lender may suggest you reapply within a short period of time with a cosigner. This would be someone with good credit who agrees to take ownership of the loan if you can’t repay it in full yourself. Keep in mind just what a big commitment this is for a cosigner: They must agree to be responsible for the debt if you default.

Checking Your Credit Report

Your credit report is a statement that contains information about your credit activity and reflects how well you’ve handled debt in the past. However, your credit report may contain erroneous information about your identity, account errors, debt duplication, and more.

You can get a free annual copy of your credit report from each of the three credit bureaus at AnnualCreditReport.com, by calling 877-322-8228, or via mail at Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. If you do find any mistakes, you can dispute them and potentially build your credit score.

Building Your Credit

If your credit score wasn’t high enough to qualify for a personal loan, you may want to check your lender’s requirements and reapply when you have a better credit score. There are several ways to build your credit:

• Be meticulous about paying your bills on time.

• Don’t apply for too many loans or credit lines in a short period of time.

• Keep your DTI at no more than 43%, preferably lower.

• Maintain credit accounts in good standing; length of credit history counts toward building your score.

• Aim for a good credit mix. Having installment loans, say, as well as credit cards can help build your score.

When to Reapply for a Personal Loan

How soon you can reapply for a personal loan may vary depending on your lender and the reason why you were rejected. Some lenders may allow you to quickly reapply if you bring a cosigner on board, as noted above. Others may require you to wait up to 90 days before you apply again for a personal loan. Also, you may need to wait a period of time to, say, build your credit score to bring it in line with what a lender requires. That could take months.

Your lender can likely give you some suggestions about whether it makes sense to reapply quickly or wait a while.

Alternatives to Personal Loans

If you can’t get approved for a personal loan, here are some other funding sources to consider.

• Credit cards: Credit cards are a definite alternative to personal loans, but if you don’t pay off your monthly balance, the interest rates are higher for these than personal loans. That could lead to you having significant credit card debt. Credit cards also work differently than personal loans; what you owe is based on the amount of credit you use and the interest charged, versus how a lump-sum personal loan is paid back.

• Home equity loan: A home equity loan differs from a personal loan because you use your home equity (the difference between the home’s value and what’s owed on the mortgage) to secure the loan. This is critical to note: If you stop making payments, the lender can seize your home. In terms of how it works, you’ll receive the money in one lump sum and pay back principal plus interest monthly over the term of the loan.

• Home equity line of credit (HELOC): A HELOC, just like a home equity loan, is secured by your home. However, it works like a credit card, allowing you to draw on your loan as much as you want through a withdrawal period. After that period, a HELOC enters the repayment phase.

• Cash-out refinance: A cash-out refinance is a type of mortgage refinance that allows you to borrow more than you currently owe. You can take that difference in cash. Again, as with a home equity loan or HELOC, your property will serve as collateral. If you can’t make the payments, you could lose your home.

• Peer-to-peer loan: These loans, which bypass traditional lenders, are also called “crowdfunding loans” or “social lending loans.” They differ from loans from financial institutions because multiple investors fund them. Peer-to-peer loans may offer an alternative to individuals who can’t get loans from traditional lenders. Some peer-to-peer lenders include Prosper and Upstart.

As you consider these options, it’s important to shop around and compare interest rates and repayment terms before you make a decision.

The Takeaway

If you’re denied for personal loans, it could be due to low or variable income, your credit score, or other factors. It’s important to consider your options, whether reapplying or finding an alternate source of funding, so you can find the best fit for your finances.

Shopping for a personal loan? See what SoFi offers.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.

SoFi’s Personal Loan was named a NerdWallet 2026 winner for Best Personal Loan for Large Loan Amounts.

FAQ

Why do I keep getting denied for a small loan?

The reasons for a personal loan denial can vary. Low income, a poor credit score, and other factors may be to blame. Often, however, you can gain insight about why your application was not approved and then work to secure funding in the future. If you are applying often for various forms of credit, that could be one reason why lenders are wary.

How can I get a loan when I can’t get approved?

If you’ve been turned down for a personal loan, you might be able to bring on a cosigner and get approved. Or you could consider waiting and applying for a personal loan with a stronger application package. You can also seek a different form of funding, such as a home equity loan or a peer-to-peer loan.

How hard is it to get a $30,000 personal loan?

You may qualify for a $30,000 personal loan if you meet the requirements, which often include having a credit score of at least 580 to qualify and above 700 for more favorable terms.

About the author

Melissa Brock

Photo credit: iStock/Milan Markovic

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Apr

2025

Chimney Repair Costs 2025

By Melissa Brock | personal_loan | Comments Off

Fewer things are more comforting than a crackling fire on a chilly day, but what happens when your chimney needs a little TLC? Repairs generally cost between $160 to $750, with an average repair running around $455, according to HomeAdvisor. But the amount you end up paying will depend on several factors such as the type of repair needed, your chimney’s materials, and labor costs.

Even if you only light your fireplace for part of the year, you’ll want to fix any chimney problems as soon as you can. A damaged chimney could increase the risk of a fire or prevent toxic gasses from passing safely into the air outside.

Here’s a closer look at common chimney repair costs so you can plan accordingly.

Key Points

• Chimney repairs typically cost $160–$750, with an average of about $455, though major repairs like liner replacements can reach $7,000 or more.

• Repair costs vary by type of damage: caps ($150–$300), masonry/tuckpointing ($300–$1,500), liners ($625–$7,000), and stucco chimneys ($570–$1,920+).

• Labor averages $50–$200 per hour, with higher bills for complex or hard-to-reach repairs.

• Additional expenses include inspections ($100–$5,000), cleaning ($120–$390, but up to $5,000 if neglected), and permit fees ($50–$300).

• Signs you may need repair include cracks, leaks, smoke blowback, leaning structures, or spalling bricks — all of which can pose serious safety risks if ignored.

Factors That Impact Chimney Repair Cost

If a chimney is well maintained, you can expect it to last for 50 to 100 years. Still, it’s a good idea to carve out space in your household budget for occasional maintenance and repairs. When you’re planning how to pay for the fixes, keep in mind that several different factors can impact your chimney repair costs.

Type of Repair

The type of repair can impact the overall cost of a project. For example, capping repair usually involves replacing the very top cap on your chimney. This type of project typically costs between $150 to $300, according to HomeAdvisor.

Another common repair is fixing the mortar and bricks in a chimney. The job might entail tuckpointing, which incorporates two different mortar colors to make the chimney look newer. Masonry chimney repair costs usually cost between $300 and $1,500, while prefab chimneys cost less because they have fewer components. The job typically costs between $250 and $1,200.

Lining repair involves fixing the chimney liner, which, when cracked, can pose a fire risk. Chimney liners cost between $625 to $7,000, with a national average of $2,500.

Type of Chimney

Chimney types vary by material, and this can impact how much a repair costs. Four common types of chimneys include brick, stucco, metal, and prefabricated.

Depending on how much damage there is, brick chimneys cost $175 to $1,000 on average to repair, though you can expect to pay more for more significant work. If you’re fixing a metal and prefabricated chimney, plan on paying in the neighborhood of $200 to $1,200, depending on how extensive the damage is.

Have a stucco chimney? You’ll likely need to pay more to have it repaired. Projects typically run between $570 to $1,920, though bigger jobs can run as high as $4,200.

Labor

Professional chimney repairs usually cost between $50 and $200 per hour. That said, the more damage there is, the harder the damaged area is to reach, and the more time a project requires, the more you may end up paying in labor costs.

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Additional Costs

A repair may not be the only cost you encounter. Chances are, you might also pay for routine chimney inspections, chimney cleaning, ongoing maintenance, and permits.

Chimney Inspection

Whether you’re buying a fixer upper or renovating your current home, you should plan on having your chimney inspected by a professional once a year. The condition a chimney is in determines the type of inspection it needs. There are three levels of inspection:

• Level one inspection: A level one inspection is an annual routine inspection and typically costs between $100 and $950.

• Level two inspection: A level two inspection goes a step further to include a more extensive investigation into potential structural issues caused by recent damage. It costs between $200 and $1,000.

• Level three inspection: A level three inspection looks at every part of a chimney, inside and outside, which may require taking out walls or portions of the chimney. It costs between $500 and $5,000.

Chimney Cleaning

Cleaning a chimney typically runs between $120 and $390, or an average of $250. If your chimney has not been maintained well, there may be heavy creosote buildup or other damage. This could lead to a higher clean-up bill of up to $5,000.

Ongoing Chimney Maintenance

All chimneys need regular maintenance. Depending on the type of upkeep required, you may pay for a simple cleaning (an average cost of $250). But if a chimney repair contractor finds that your chimney restoration needs more attention, you could pay more.

Permits and Related Fees

Once you find a contractor and finalize your plans, work can begin. Keep in mind that before constructing or changing the outside dimensions of a structure, your contractor will need to secure a building permit. A building permit generally costs $50 to $300 for small jobs.

Types of Chimney Repairs

From the crown to the flashing, we’ll look at the various parts of the chimney and what it might cost to fix each one.

Stack Repair

The chimney stack is the part of the chimney that appears above the roof. Chunks of missing masonry, crumbling brickwork, and visible cracks can signal that your chimney stack needs to be repaired.

Mortar Repair

Mortar acts as a buffer between the bricks in a chimney. But that buffer can crack and deteriorate from movement and pressure, so pay attention to how your mortar looks from year to year.

Repair could involve repointing and/or tuckpointing. Repointing means removing and replacing damaged mortar joints, while tuckpointing uses two different colors of mortar to make the mortar joints look different.

Crown Repair

The crown is the top part of the chimney and prevents rainwater from getting into your chimney. Typically made of concrete, the crown should be checked for visible cracks, deterioration, wall damage, and pooling water.

Cap Repair

Chimney caps, usually made of steel or copper mesh, sit on the crown at the very top of the chimney. The cap covers the flue, or the duct that allows smoke to leave the chimney. Caps also keep rainwater, animals, and debris from entering the chimney. Missing tops, rusted screens, creosote accumulation, and screen holes can all indicate that your chimney cap needs attention.

Foundation Repair

Chimneys often have their own foundations, but they sometimes settle. This could allow moisture, critters, and other items to enter your home. Look for a crumbling foundation, which might also present fire hazards and falling bricks and mortar.

Liner Repair

A chimney liner, or flue liner, is the vertical passage located inside your chimney that carries fumes to the outdoors. Similar to an exhaust pipe, the flue keeps wasteful gasses from spreading into your chimney cavity.

There are some signs that yours may need a replacement, including finding broken shards and flakes of parts of your chimney and smoke in your home. It’s a good idea to consider replacing your chimney liner if it’s older. Less-expensive models should last up to five years, while a well-constructed liner can usually be counted on for up to 20 years.

Wood Rot Repair

Wood rot can compromise your home’s structural integrity and affect any part of the chimney that has wood in it: the crown, cap, or flue liner. Indications of wood rot might include discoloration or staining, a musty smell, cracks in the wood, and evidence of pests.

Smoke Chamber Repair

The smoke chamber refers to the part of the chimney located just above the damper and connects the firebox to the flue. It guides smoke from a fire up into the flue and out of your home. Since many smoke chambers contain steps, gaps, and holes, they can contain flammable creosote and soot buildup.

Flashing Repair

The flashing of a chimney joins the roof to the chimney and is made of aluminum, steel, copper, vinyl, or PVC. The flashing should last 30 years. But if there’s damage, you could end up with leaks in the roof due to rusting and corrosion, animals, loose caulk and gaps, and wear and tear.

Flue Repair

A flue is any open, vertical part of the chimney that lets smoke escape. (Don’t confuse this with the chimney liner, which lines the flue.) Signs the flue needs attention may include broken shards and flaking and smoke in your home.

Cricket Repair

A chimney cricket, also called a roof cricket, sits behind your chimney and looks like a tiny peaked roof. It juts off the main roof and sits directly against the backside of the chimney to divert water from the masonry. Water stains on the ceilings or walls, rafters near a chimney or damaged mortar and bricks or rotten wood can identify whether the chimney cricket is working or not — or if you need a chimney cricket and don’t have one. (Tip: Chimneys that are 30 inches or larger need a cricket.)

Brick Replacement

Brick replacement may involve replacing just a few bricks — or redoing the entire chimney. Note that if the bricks are in areas that are hard to reach, a professional may charge more for the job.

Siding Repair

If you have a chimney made of siding, it can be at risk for rotting, swelling, and deterioration. Even if it looks good from the ground, a “diseased” chimney could be rotten and cause water to enter your home through the roof or ceiling.

Repairing vs Replacing a Chimney

The extent of your chimney’s damage determines whether you should have it replaced or simply repaired. However, there are some clear signs that indicate you may need to completely replace your chimney:

• Large cracks in the bricks

• White streaks on the bricks

• Spalling bricks (bricks falling down)

• Tilting

Even if some of those indications are present, it’s a good idea to consult with a professional to know exactly what to do next about your fireplace chimney repair.

Signs You Need a Chimney Repair

Indications you need a chimney repair include cracks that appear, smoke blowback, leaks, leaning, or spalling bricks. Let’s walk through what these might mean.

Cracks

Cracks in the chimney’s masonry can signal that it needs attention. Cracks can lead to gas seeping into your home, which can increase the risk of carbon monoxide poisoning. Excess moisture, earthquakes, or other weather events; hail; acidic decay; wind; and hot or cold temperatures usually cause cracks to appear.

Smoke Blowback

Smoke blowback creates a safety and health hazard. Not only could your house sustain a fire, but you could also face carbon monoxide, volatile organic compounds, polycyclic aromatic hydrocarbons, and other pollutants in your home. There are several causes for smoke blowback, including a blockage in the chimney or even a home that’s too well insulated.

Leaks

Chimney leaks are a common problem. When your chimney drips water or you see moisture in the fireplace or surrounding walls, you may also see attic and wall damage. The chimney itself may have a leak, or the roof may leak. For example, the chimney cap or crown may be damaged, bricks or mortar may have issues, the flashing may not be working properly, or condensation may have built up in the chimney.

Leaning

Exposure to all sorts of weather can cause the mortar joints in a chimney to decay. This causes bricks to loosen and the chimney to lean. Other reasons for leaning include a lack of footings and shifting soil. A leaning chimney doesn’t just look bad — it can also pose a safety risk and may even collapse.

Spalling Bricks

Spalling brick refers to bricks that flake, pit, or crumble and fall away from the masonry. Small cracks usually start and grow larger until the brick completely deteriorates. Improper mortar, weather, improper insulation, non-breathable masonry sealants, cleaning with a pressure washer, and impact to the bricks can all cause spall. Spalling poses a safety risk — there’s a possibility the structure collapses and damages the rest of the roof.

Shaling Tiles

Have you noticed pieces of flue tiles accumulating at the bottom of your chimney? This may be the result of shaling, which is a sign that your flue tiling is damaged. A professional can use special equipment to confirm whether there’s an issue, identify the problem spot,and offer potential solutions.

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Can I Repair My Chimney Myself?

Depending on the issue, fixing a chimney can take a big bite out of a homeowner’s budget, but there are several ways to finance the cost of chimney repair. For instance, you may decide to dip into emergency savings, use a credit card, take out a personal loan, or turn to your homeowners insurance.

Or, depending on your situation, it might make sense to explore a cash-out refinance, a home equity line of credit (HELOC), or consider emergency home repair financing options. As you make your decision, it’s a good idea to compare the interest rates and the pros and cons of each type of financing.

You may also be tempted to attempt to tackle the work yourself and save some money in the process. Though many home improvement projects may be appropriate for the DIY-er, chimney work is not one of them. You assume serious risks when completing a chimney repair yourself — the same kinds of risks you’d face repairing a roof. Even if you can overcome those risks, you’ll still have to know how to repair the chimney. And certain tasks, such as a complete chimney replacement, require advanced knowledge of the mechanics of a chimney.

The Takeaway

A well-maintained chimney is designed to last for decades, but that doesn’t mean it won’t require the occasional repair or maintenance. Repairs typically cost between $160 to $750, though that price depends on a range of factors, including the type of chimney you have, the work being done, and labor costs. But chimney upkeep is an important line item to include in the budget because there are potential safety risks involved when repairs aren’t made.

When it comes to financing chimney repairs, homeowners have several options, including homeowners insurance, dipping into an emergency fund, and taking out a personal loan.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.

SoFi’s Personal Loan was named a NerdWallet 2026 winner for Best Personal Loan for Large Loan Amounts.

FAQ

When should I replace my chimney?

You may never need to replace your chimney as long as you live in your home, since chimneys can “live” up to 100 years. However, if you live in an old home or can see issues with your chimney, consult a chimney repair contractor, who can determine whether it needs to be replaced.

How often should I clean my chimney?

The National Fire Protection Association (NFPA) suggests having your chimney cleaned and inspected once per year by a chimney sweep. You should also have your chimney swept at least once per year. A professional can ensure that everything is in working order.

What qualifications should I look for in a chimney repair contractor?

Hiring a professional with the right credentials is important, so look for certifications by the National Fireplace Institute (NFI), Chimney Safety Institute of America (CSIA), and Certified Chimney Professionals (CCP). Check a chimney repair contractor’s Better Business Bureau (BBB) rating. Ask for a portfolio and recommendations, and confirm that the company is insured.

How do I compare quotes from different chimney repair contractors?

Get several quotes from various contractors in your area and compare them apples to apples. The cheapest one may not be the best fit for the job. For example, one contractor may offer a more thorough repair than another for, say, brick chimney repair costs. Ask for a list of services and a detailed list of the costs involved before you decide on the contractor. It also doesn’t hurt to ask friends and neighbors for recommendations.

Are there any permits or inspections required for chimney repairs, and how much do they cost?

A building permit typically costs $50 to $300 for small jobs, though it may depend on where you live. Once you find a contractor, they should be able to answer your questions about the costs of a building permit.

Will my homeowner’s insurance cover the cost of chimney repairs?

If your home is damaged by a covered loss, your insurance will cover the cost of chimney repairs. For example, your insurance will likely provide coverage if lightning strikes your chimney and ruins the brick and mortar. However, if your chimney has been neglected and causes a fire in your living room, your homeowner’s insurance may not cover the damage. Ask your insurance carrier for more information about your specific situation.

How can I finance the cost of chimney repairs?

Consider a variety of different types of financing, from using your credit card to taking out a personal loan from a lender (such as your mortgage lender). Also consider emergency home repair financing options, a cash-out refinance or a home equity line of credit (HELOC). Compare the interest rates, pros and cons of each type of financing, to determine which type of financing works best for you. For example, if you know you will have a repointing chimney cost on your hands, consult with at least five contractors and get prices, then ask your bank or credit union for more information about financing options.

Are there any tax breaks available for chimney repairs?

Generally, home repairs, such as fixing a broken chimney, are not tax deductible. However, a home improvement, such as adding a chimney to your house, may be tax deductible. Check with an accountant for more information.

How can I ensure my chimney repair project stays within budget?

Put together a budget so you know exactly how much you can afford to spend on your chimney repair. Keep in mind that the chimney repairs cost could run you between $160 to $750, with an average repair cost of $450, to fix your chimney. Chimney rebuild costs will likely cost the most. Check with an experienced contractor in your area to learn about your project’s costs, and be sure to get a list of costs ahead of time.

What are the risks of not repairing my chimney?

Leaving chimney issues unchecked can result in a number of safety hazards, including fatal fires, carbon monoxide poisoning, and other toxic chemicals. To help you spot and address problems early on, consider getting an annual inspection recommended by the NFPA. A professional chimney inspection could uncover a chimney repair problem you can’t see from your living room or from the ground.

About the author

Melissa Brock

Photo credit: iStock/arak7

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Apr

2025

How to Negotiate House Price as a Buyer

By Ashley Kilroy | Home Ownership, mortgage | Comments Off

Buyers who learn how to negotiate house prices lay the foundation for a mutually acceptable deal. Whether you’re a first-time homebuyer or not, these strategies to negotiate home prices may help you score a property at the price that works best for you.

Table of Contents

Why You Should Negotiate House Prices
Things to Know Before Negotiating Home Prices
How Much Can You Negotiate on Average?
How to Negotiate a House Price as a Buyer
Tips on Negotiating House Prices
Knowing When to Walk Away From an Offer

Key Points

• Research the market to understand home values and trends in the desired area.

• Determine a fair offer by comparing similar properties and recent sales.

• Consider the home’s condition and necessary repairs when making an offer.

• Negotiate with the seller, starting with a lower offer and being prepared to compromise.

• Get preapproved for a mortgage to strengthen the offer and show financial readiness.

Why You Should Negotiate House Prices

While negotiating the price of a home as a buyer can seem intimidating, the benefits may make it worth overcoming the reluctance. For starters, negotiating lets the seller know you’re serious about the home. And if the asking price is higher than you feel comfortable with, negotiating can help you see if there is any wiggle room.

A successful negotiation gives you the opportunity to create a concise offer that you’re happy with and that helps you stay within your budget. It can feel great to get the house you want without putting yourself in a stressful financial situation.

Things to Know Before Negotiating Home Prices

Know Your Market

The market will dictate how much leverage you have to negotiate a home price. So start by determining whether it’s a hot seller’s market or a buyer’s market.

The power is typically in your hands if the number of homes for sale exceeds the number of willing buyers. Markets can vary from city to city and neighborhood to neighborhood. So check with your real estate professional to be certain what type of market you’re working with.

Know the Value of an Agent

Can you buy a house without a real estate agent? Sure, but it’s not a decision to make lightly.

Besides the fact that real estate agents know what’s reasonable for the current market conditions, they have valuable experience that can help you navigate offers and counteroffers. And because they aren’t emotionally attached to the outcome, they are better set up to get the best deal without making excessive concessions.

But you don’t want to work with just any agent. You want to work with someone who is a buying and selling expert, has connections with other agents in the area, and is knowledgeable about the community you’re interested in.

Got your eye on a house for sale by owner? You can find a real estate agent or go it alone.

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prequalify for a SoFi mortgage loan,
with as little as 3% down.

Questions? Call (888)-541-0398.

How Much Can You Negotiate on Average?

One of the best ways to get an idea of how much you can negotiate is to research the prices of “comps,” recently sold homes in your target area that are similar to the property you’re trying to buy.

A real estate agent will have access to market trends. But you can obtain the information yourself on sites like Zillow, Realtor.com, Redfin, and Trulia. If you’re moving from out of state, this guide to the cost of living by state can give you a sense of what housing expenses to expect. In a large state such as California, it’s helpful to consider the cost-of-living breakdown for individual cities.

Zillow also lists how long for-sale properties have been on the market, which can give you some insight into how negotiable a list price may be.

Unless you’re in a hot seller’s market, you may be able to offer 10% under the asking price and even ask the seller to pay closing costs or certain other concessions.

How to Negotiate a House Price as a Buyer

Once you have a sense of the market and an agent to help you negotiate, the next step is to get your finances in order so you’ll be in a strong position to negotiate. Sellers are apt to be most enthusiastic about buyers who have been preapproved, as opposed to prequalified, for a mortgage.

While both involve a lender taking a peek at your financial information, such as income, credit history, debts, and assets, preapproval involves an in-depth application and verification process. It signals sellers that you’re seriously pursuing mortgage loans, so it’s a great way to send your offer to the top of the pile.

If you already own a home, selling it ahead of time could also put you in a better position to negotiate: It means you won’t have to wait until your home is sold to go forward with the buying process.

This “chain-free” approach requires careful timing and possibly setting up a temporary living space. While it’s not feasible for everyone, it is an option to keep in mind if you’re hoping to increase your odds of success in a competitive market.

Tips on Negotiating House Prices

Keep Your Cool

From the first time you walk through the home, it’s a good idea not to show all your cards by appearing overeager, even if you’re totally in love with the place. If you come across as desperate for the house, sellers may feel they can expect a higher offer from you.

Don’t be afraid to point out any drawbacks that give you pause, and give yourself time to shop around before you get serious about putting money on the table.

Get an Inspection

Found a property you love? While your mortgage lender might not require a home inspection — and while forgoing one may make your offer more appealing to the seller — it’s probably in your best interests to have one.

Without a home inspection, the only information you have about the house comes from what the seller is able (or willing) to disclose and what you observe during your tour. Home inspections can reveal hidden issues like cracks in the foundation or plumbing problems.

Along with helping you plan for unforeseen repair costs ahead of time, the inspection can also give you leverage to ask the sellers to knock down their price a bit, offer you a credit for closing costs, or fix the problem themselves. Your real estate agent can help you decide how to negotiate the house price after the inspection.

Put Your Offer in Writing

Many experts recommend putting your offer in writing and adding as much detail as possible. That way you avoid any disagreements on what was said and can negotiate on factors beyond price.

When competing against multiple offers on a house, buyers may waive one or all contingencies to sweeten their offer. Contingencies are simply conditions that must be met in order to close the deal.

An appraisal contingency can be an opportunity to negotiate the home price or back out if the property does not appraise at the price in the purchase contract.

A clear title contingency also gives the buyer a way out if liens or disputes are associated with the property.

And it can’t hurt to ask for help with closing costs.

Plead Your Case

In a competitive market, you might also consider adding a personalized letter to your offer. It might sound cheesy, but selling a home can be just as emotionally fraught as buying one. Describing why you love the house or how you imagine your family growing with the property can help your offer stand out from others, even if you aren’t the highest bidder.

Avoid offending a seller with a lowball offer, particularly if you’re negotiating in a seller’s market or purchasing a beloved property that’s been in the family for years. If you do decide to bid around 20 percent under the asking price, make sure you’re willing to walk away.

When it comes time to make an offer, consider not only the list price but closing costs and any repair or renovation expenses.

Knowing When to Walk Away From an Offer

Although you’ll generally hear back on (realistic) offers within a few business days, sellers aren’t legally obligated to respond to your offer at all. Including an expiration date in your offer will give you a firm calendar date on which you’ll know for a fact you didn’t get the home, which means you’ll be able to redirect your efforts.

Purchasing a home can take a long time. There’s no reason to waste your energy when it’s a lost cause.

A seller who responds to your offer but who isn’t inclined to move on the price of the house might be willing to instead make repairs that are needed and that are identified during the inspection of the property. And consider asking the seller to throw in items like furniture or play equipment that they might be planning to take with them. If they decline and you still don’t feel good about the price, it’s time to walk away.

The Takeaway

Negotiation is crucial in love and war, in a salary decision, between parents and toddlers, and in real estate. If you’re a buyer, the more you know about negotiating home prices, the better.

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FAQ

How do you politely ask for a lower price?

Rely on your real estate agent to help you determine a good offer price. Then consider writing a personal letter to accompany the offer, addressing the seller by name if possible and conveying, in a friendly tone, a sincere message about what you like about the house or how you can imagine your family living there.

How much can you negotiate when buying a house?

How much you can negotiate depends on how “hot” the market is. In a competitive seller’s market you may not be able to negotiate at all. Rely on your real estate agent to guide you. A property that has been on the market for a long time may provide more opportunity for negotiation.

What is not a smart way to negotiate when buying a home?

Avoid making a very low initial offer — you risk offending the seller. And don’t criticize the seller’s taste by, say, pointing out that the kitchen decor isn’t to your liking. Finally, if you are preapproved for a mortgage that is greater than your offer price, don’t tip your hand; instead, ask your lender to tailor the preapproval letter to the amount you are offering.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

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Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

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