Header Image

How To Get The Best Mortgage Rate

Buying a new home is one of the most important and expensive purchases a person will ever make, and for most buyers, getting a mortgage is absolutely essential to being able to afford their new home. However, many home buyers find themselves overwhelmed by the variety of options available to them when it comes to choosing a lender. Mortgage rates can vary significantly from one lender to the next and for home buyers, finding the best mortgage rate can be a frustrating process. However, there are certain things you can do to improve your chances of getting the most advantageous rate possible. Credit Rating: Your credit rating is one of the primary factors that lenders take into account when reviewing your loan application. A poor credit score often results in higher interest rates on your mortgage and can even cause some lenders to decline your application. Before applying for a mortgage loan, it is crucial to check your credit score and rectify any negative points on your report. In many instances, people find that their score is low due to misreported information and other mistakes which are relatively easy to correct by contacting the companies involved. However, if your score is low because of unpaid debts, creating a payment plan and paying down some of those debts can help improve your chances of getting a better mortgage rate. Save Up: Having a sizable down payment ready before you go mortgage shopping can significantly increase your chances of getting the best mortgage rate. Most mortgage professionals recommend that home buyers put down 20% of the estimated purchase price of their home as a down payment although some lenders allow for a lower down payment. Having a higher down payment lowers your principal loan amount and therefore your interest rates as well. Many states allow people to use gifts of money from family or friends as part of their down payment amount as long as they have documentation stating that those gifted sums of money do not need to be repaid. Crunch the Numbers: Before you look for a mortgage lender take some time to go through your budget to determine exactly how much you have available to spend on monthly mortgage payments. Your projected monthly mortgage payments should leave you enough financial leeway to pay for your other monthly expenses such as utility bills and groceries, as well as home maintenance costs throughout the year. Keep in mind that your mortgage payments will also have to cover monthly payments for home insurance as well as Escrow payments for property taxes. Shop Around: When looking for the best mortgage rate, it is important to consider all of your options carefully before making a decision. Different lenders will offer different rates and while some will work with borrowers who have a dented credit score, others might not. Also consider alternative options such as arranging your mortgage through a credit union or through a federal plan such as FHA or HUD. A seasoned realtor can help you find the best lenders for your needs and most lenders will give prospective borrowers a good faith estimate, enabling you to compare different lenders’ rates more accurately.
Resources
 
Home Savings and Loans
homesavingsand-loan.com
Home
Mortgages And Loans
For Information on our mortgages and insurance, please call us at: 916-663-7195
Home
Copyright homesavingsand-loan.com 2011 About   Contact   Terms   Privacy

How To Get The Best

Mortgage Rate

Buying a new home is one of the most important and expensive purchases a person will ever make, and for most buyers, getting a mortgage is absolutely essential to being able to afford their new home. However, many home buyers find themselves overwhelmed by the variety of options available to them when it comes to choosing a lender. Mortgage rates can vary significantly from one lender to the next and for home buyers, finding the best mortgage rate can be a frustrating process. However, there are certain things you can do to improve your chances of getting the most advantageous rate possible. Credit Rating: Your credit rating is one of the primary factors that lenders take into account when reviewing your loan application. A poor credit score often results in higher interest rates on your mortgage and can even cause some lenders to decline your application. Before applying for a mortgage loan, it is crucial to check your credit score and rectify any negative points on your report. In many instances, people find that their score is low due to misreported information and other mistakes which are relatively easy to correct by contacting the companies involved. However, if your score is low because of unpaid debts, creating a payment plan and paying down some of those debts can help improve your chances of getting a better mortgage rate. Save Up: Having a sizable down payment ready before you go mortgage shopping can significantly increase your chances of getting the best mortgage rate. Most mortgage professionals recommend that home buyers put down 20% of the estimated purchase price of their home as a down payment although some lenders allow for a lower down payment. Having a higher down payment lowers your principal loan amount and therefore your interest rates as well. Many states allow people to use gifts of money from family or friends as part of their down payment amount as long as they have documentation stating that those gifted sums of money do not need to be repaid. Crunch the Numbers: Before you look for a mortgage lender take some time to go through your budget to determine exactly how much you have available to spend on monthly mortgage payments. Your projected monthly mortgage payments should leave you enough financial leeway to pay for your other monthly expenses such as utility bills and groceries, as well as home maintenance costs throughout the year. Keep in mind that your mortgage payments will also have to cover monthly payments for home insurance as well as Escrow payments for property taxes. Shop Around: When looking for the best mortgage rate, it is important to consider all of your options carefully before making a decision. Different lenders will offer different rates and while some will work with borrowers who have a dented credit score, others might not. Also consider alternative options such as arranging your mortgage through a credit union or through a federal plan such as FHA or HUD. A seasoned realtor can help you find the best lenders for your needs and most lenders will give prospective borrowers a good faith estimate, enabling you to compare different lenders’ rates more accurately.
Resources
Home Savings and Loans
Copyright homesavingsand-loan.com 2011 About   Contact   Terms   Privacy