How to get the best mortgage rate

If your time has come to buy a home, make absolute sure you are prepared to handle all the responsibilities owning a home requires.

This includes repairing any damages, keeping your home well maintained and handling a wide variety of expenses such as closing costs, insurance and policy fees, maintenance repairs and much more.

Because there are countless expenses a home acquires, many people take out a mortgage loan to help finance their property.

Odds are, majority of people do not have $300,000 or so dollars lying around to spend all at once.

Which is why people team up with mortgage lenders for financial mortgage assistance.

Before your lender helps fund your mortgage, they need to appropriately evaluate you before they agree to lend a couple thousand dollars.

How does my lender evaluate me?


When you apply for a mortgage loan, you are evaluated by your lender of your eligibility for a particular loan and interest rate.

Your lender will analyze your credit score, employment history, debts and other factors to accurately determine what they can offer you.

Once your lender has reached a decision, they will inform you of what type of loan and interest rate you qualify for.

Everyone’s financial situation is different, so that means not all interest rates are the same. So, do not compare rates with family or friends because that will not accurately reflect what rates you are qualified for.

Because you are borrowing money from a lender, they require you to pay it back on a schedule (for example, a 15 or 30-year term) that you are comfortable with, plus interest.

Interest rates have the ability to rack up thousands of dollars, depending on what term you choose and your credit risk (AKA, the likelihood you are going to pay the loan back).

The bottom line: your mortgage interest rate is a big deal.

So, how do you get the best rate?

Here is how:

Improve your credit score


Simply, the higher your credit score is, the lower the interest rate will be.

Having a strong credit score proves to lenders and banks that you are a low credit risk, which means, you are less likely to miss or not make payments.

In result, lenders will offer applicants a lower interest rate.

Opposed to people with low credit scores, lender will issue higher interest rates because of their unpredictability.

Did you know high interest rates have the ability to accumulate thousands of dollars of the course of your loan’s term?

Avoid paying more than you have to by strengthening your credit score to a more desirable number.

Unfortunately, what qualifies as “good” caries from lender to lender.

For a general rule of thumb, here is a chart of what is considered poor through exceptional:

  • Poor: below 580
  • Fair: 580 – 669
  • Good: 670 – 739
  • Very good: 740 – 799
  • Exceptional: above 800

If you are looking for ways to improve your credit score, here are a few simple ways:

  • Never miss a payment
  • Pay in full and on time
  • Pay off any debts (credit card, outstanding bills, etc.)

By incorporating these practices into your financial situation, you can gradually improve your credit score.

Sadly, your credit score does not improve over night. So, be patient and continue to keep yourself accountable of your finances.

If you are wondering what your credit score currently is, you can request a free credit report from the Annual Credit Report, or Experian, which allows people to obtain their report with no credit card information required.

Have a history of employment


Typically, lenders like to see applicants who have at least two years of employment from the same company.

This shows stability and a consistency of earnings.

Having this record under your belt will prove to your lender that you have a stable income and can financially handle a mortgage.

Some lenders require contacts for recommendation, and many of the times, applicants list their employer as a referral.

Utilizing your employer as a referral is encouraged because they can speak on behalf of your behavioral habits and ability to handle this type of responsibility from a professional standpoint.

This tactic can sway your lender to believe you are a qualified and reliable applicant.

In other cases, some lenders deny applicants they have under two years of employment. If applicants are unable to prove their employment history, how will lenders be able to safely assume they have a sufficient income?

If applicants can’t financially prove themselves, lenders will most likely not take the chance to lend money to a client that has no history.

Your down payment matters


Generally, you will be offered a lower interest rate when you put more money down for your down payment.

More commonly, lenders and financial advisors will encourage clients to put down 20 percent of the home’s market value.

The primary reason experts suggest clients to put down more is so that their monthly mortgage payments will be lower, and so will their mortgage rate and principle.

ID you decide you cannot afford to put down 20 percent of the home’s market value, that’s O.K. You can still purchase a home. However, be aware of the consequences.

One major setback when people put down less than 20 percent is that they are required to purchase private mortgage insurance (PMI), which is an additional insurance expense that only protects the lender if the borrower fails to keep up with payments.

However, depending on what loan you choose, will determine the minimum amount needed for a down payment. But, there are certain guidelines to be met in order to qualify.

For example, an adjusted-rate mortgage (ARM) loan requires a specific credit score to qualify, with the minimum being 620. This gives people the ability to put down as little as 10 percent.

As you can see, your down payment plays a vital role in the mortgage process, which is why you should understand its significance.

Because financing a home is the number one obstacle potential homebuyers face, the government and other organizations have created programs and grants to help buyers purchase their home.

Just like down payment guidelines, there are restrictions and specific rules to be met in order to qualify for these programs.

For example, there are first-time homebuyer grants and programs for people looking to finance their first home.

However, this ultimately depends on what state and what town you live in. Typically, cities and towns have housing aid information on their website, so check out if your targeted town offers this type of program.

What are some rate options?


Traditionally, people are drawn toward a fixed-rate mortgage because it offers affordability, flexibility and consistency.

Fixed-rate mortgages are the most common type of home loan because monthly payments are the exact same over the course of the loan. This also goes for the interest rate and principle.

People are attracted to fixed-rate mortgages because they will be able to accurately budget their expenses monthly without worrying about the payments changing.

Most lenders offer borrowers a 15 or 30-year term, which both offer a different set of pros and cons.

A 15-year loan term is appealing to borrowers who are looking to pay off their loan faster. Although borrowers have a shorter loan term, their monthly mortgage payments are higher. But, they pay a significant less amount of interest.

A 30-year loan term is appealing to borrowers who want an affordable and steady payment schedule. This option takes longer for borrowers to pay back, but, monthly mortgage payments are lower. However, borrower will pay a larger amount of interest compared to a 15-year term.

Deciding between these two rate options can be difficult, which is why your lender is here to help you.

They can help analyze your financial situation, credit history, debts and other factors to determine which loan term would suit you best.

On the other hand, borrowers also look at adjustable-rate mortgages (ARMs) as an option.

ARM’s offer the same loan terms as fixed-rate mortgages, however, it differs in one big way:

Interest rates can increase or decrease without warning during the life of the loan. This option is riskier because borrowers will never really know how much money will be required monthly for mortgage payments or interest.

An ARM’s interest rate is reflected off an index that measures the economy’s market and a margin that your lender sets depending on your down payment amount and credit score.

As you can see, there are big differences between a fixed-rate and an adjustable-rate mortgage. It is highly recommended to ask your lender for professional advice on which rate option would work best for you.

Lock in your

low mortgage rate today!

Get My Low Rate

mortgage loan process

47 responses to “How to Get the Best Mortgage Rate”

  1. There is noticeably a bundle to know about this. I assume you made sure good factors in features also.

  2. jordan shoes says:

    A formidable share, I simply given this onto a colleague who was doing a bit of analysis on this. And he in fact purchased me breakfast as a result of I discovered it for him.. smile. So let me reword that: Thnx for the deal with! However yeah Thnkx for spending the time to discuss this, I feel strongly about it and love reading more on this topic. If potential, as you become experience, would you mind updating your blog with extra details? It is extremely helpful for me. Massive thumb up for this blog put up!

  3. This actually answered my downside, thanks!

  4. golden goose says:

    you may have a terrific weblog here! would you prefer to make some invite posts on my blog?

  5. I抎 have to verify with you here. Which isn’t one thing I often do! I take pleasure in studying a submit that may make folks think. Additionally, thanks for allowing me to comment!

  6. Your place is valueble for me. Thanks!?

  7. nike shox says:

    This website online is really a stroll-through for all of the data you needed about this and didn抰 know who to ask. Glimpse right here, and you抣l positively uncover it.

  8. I simply wanted to post a remark to thank you for those awesome advice you are giving out on this site. My long internet lookup has at the end of the day been compensated with high-quality insight to write about with my two friends. I ‘d assert that most of us visitors actually are truly fortunate to dwell in a superb network with very many perfect people with valuable hints. I feel pretty privileged to have encountered your entire website and look forward to plenty of more cool minutes reading here. Thanks a lot again for a lot of things.

  9. fitflop sale says:

    I am also commenting to make you understand what a outstanding experience my friend’s daughter had checking the blog. She even learned plenty of issues, which include what it’s like to possess a marvelous teaching style to make certain people without difficulty grasp certain tortuous subject matter. You undoubtedly did more than our own expectations. Many thanks for showing the precious, dependable, explanatory and also easy guidance on this topic to Emily.

  10. hogan outlet says:

    Thanks for each of your effort on this site. Gloria loves carrying out research and it’s simple to grasp why. Most people learn all of the compelling tactic you create worthwhile techniques by means of the blog and therefore inspire response from other ones on the content while our princess is learning so much. Take pleasure in the remaining portion of the new year. You are always carrying out a good job.

  11. I want to express my appreciation to the writer just for bailing me out of this particular issue. Because of checking through the the web and coming across ideas which were not beneficial, I believed my life was over. Living minus the strategies to the problems you have fixed by way of this write-up is a critical case, and those that would have in a wrong way affected my career if I hadn’t noticed the blog. Your competence and kindness in controlling all the stuff was tremendous. I’m not sure what I would have done if I had not discovered such a thing like this. I can also at this moment relish my future. Thanks for your time so much for your skilled and results-oriented help. I will not be reluctant to propose the sites to any individual who would like support about this subject matter.

  12. My spouse and i felt absolutely satisfied Louis managed to complete his studies because of the precious recommendations he received from your web pages. It’s not at all simplistic to just happen to be giving out helpful hints which the rest may have been selling. And we grasp we now have the writer to appreciate for this. The most important explanations you made, the straightforward web site navigation, the friendships you can help engender – it’s got many impressive, and it is assisting our son in addition to the family reason why the issue is brilliant, which is certainly particularly fundamental. Thank you for all the pieces!

  13. I in addition to my friends have been digesting the good points on your site and then all of the sudden developed a terrible suspicion I had not expressed respect to the site owner for them. These young men ended up for this reason warmed to see them and now have certainly been making the most of them. Appreciation for turning out to be well helpful and for choosing varieties of really good resources millions of individuals are really needing to know about. Our honest regret for not expressing appreciation to sooner.

  14. nike air max says:

    I and also my buddies were actually reading the excellent key points from the website and so all of a sudden I got a terrible feeling I had not expressed respect to the blog owner for them. Those people happened to be very interested to see them and have in actuality been having fun with those things. Appreciate your really being indeed thoughtful and also for obtaining variety of magnificent useful guides most people are really needing to learn about. My personal sincere regret for not expressing appreciation to you earlier.

  15. I needed to compose you that bit of remark so as to give thanks yet again for the splendid views you’ve discussed at this time. It is simply particularly generous of you to supply unhampered precisely what a few people could have sold as an ebook to get some dough for their own end, precisely now that you could possibly have tried it if you wanted. These suggestions in addition worked to provide a great way to fully grasp other people online have the same dream like my very own to realize a great deal more when it comes to this matter. I believe there are millions of more fun situations in the future for many who go through your blog post.

  16. I definitely wanted to make a quick comment to be able to say thanks to you for all the great guides you are posting at this site. My considerable internet look up has at the end of the day been compensated with professional know-how to talk about with my family and friends. I ‘d claim that we site visitors are quite fortunate to live in a fantastic place with many awesome individuals with very helpful pointers. I feel really grateful to have encountered your entire weblog and look forward to so many more pleasurable times reading here. Thanks a lot once more for all the details.

  17. birkin bag says:

    Needed to create you a little bit of word just to give many thanks the moment again regarding the stunning tactics you’ve provided here. This is remarkably generous with people like you to give without restraint exactly what a few people would have offered as an electronic book to get some cash on their own, principally seeing that you might well have tried it if you desired. These points likewise acted like a fantastic way to be certain that the rest have the identical passion just like my own to see significantly more related to this matter. I know there are millions of more pleasant opportunities ahead for folks who looked at your blog.

  18. I simply wished to thank you so much yet again. I do not know the things that I would have worked on in the absence of these ways contributed by you over that area. It previously was an absolute intimidating difficulty in my position, nevertheless understanding a new professional strategy you dealt with that made me to jump for gladness. I am just happier for the work and hope that you realize what a great job you are carrying out teaching other individuals via your websites. More than likely you haven’t encountered all of us.

  19. nmd says:

    I not to mention my guys were found to be checking the excellent procedures on your web page then before long got a terrible feeling I had not expressed respect to the website owner for those secrets. These boys are actually consequently joyful to study all of them and have in effect undoubtedly been using those things. Thanks for simply being well considerate and for having such beneficial topics most people are really desirous to be aware of. My very own honest apologies for not expressing gratitude to sooner.

  20. coach outlet says:

    I would like to get across my appreciation for your kindness supporting those who must have help on in this topic. Your real dedication to passing the solution along appears to be definitely beneficial and has regularly made folks like me to reach their aims. Your amazing useful guidelines implies a lot a person like me and a whole lot more to my fellow workers. Thank you; from everyone of us.

  21. golden goose says:

    I actually wanted to jot down a remark so as to express gratitude to you for these remarkable strategies you are sharing on this site. My extended internet lookup has now been compensated with high-quality points to write about with my friends and classmates. I ‘d assert that many of us site visitors actually are rather lucky to live in a good network with many outstanding individuals with very beneficial methods. I feel really fortunate to have discovered the webpages and look forward to really more awesome moments reading here. Thanks a lot again for all the details.

  22. supreme says:

    I as well as my buddies appeared to be studying the great thoughts on your web blog and so all of the sudden I had a horrible suspicion I never expressed respect to the website owner for them. All the young men came so happy to see them and already have unquestionably been taking advantage of them. Many thanks for being very accommodating and for settling on varieties of notable themes most people are really needing to learn about. My personal honest apologies for not saying thanks to you sooner.

  23. coach bags says:

    I wish to show some thanks to this writer for rescuing me from this problem. Because of exploring through the world wide web and finding tips which are not beneficial, I thought my life was done. Existing minus the answers to the issues you have solved by means of your main post is a crucial case, as well as ones which may have negatively affected my career if I hadn’t discovered the blog. Your personal talents and kindness in maneuvering a lot of things was crucial. I don’t know what I would have done if I had not encountered such a subject like this. It’s possible to at this time relish my future. Thanks for your time so much for this professional and effective guide. I won’t be reluctant to suggest the sites to anyone who needs to have recommendations on this subject matter.

  24. supreme says:

    Thank you for all of your efforts on this web site. Kate really loves engaging in investigation and it’s obvious why. Many of us know all concerning the powerful means you create reliable solutions via this website and therefore foster contribution from some other people on this article and my child is actually learning a great deal. Take advantage of the remaining portion of the new year. You’re performing a powerful job.

  25. jordan shoes says:

    I as well as my guys were found to be following the excellent secrets and techniques on your site then at once developed a horrible suspicion I had not expressed respect to the web blog owner for those strategies. Those women appeared to be for that reason excited to learn all of them and now have without a doubt been using these things. Appreciate your indeed being considerably kind and then for picking out this sort of helpful subject areas most people are really desirous to learn about. Our honest regret for not expressing appreciation to sooner.

Leave a Reply

Your email address will not be published. Required fields are marked *

Pin It on Pinterest