Finding the Best Home Loan Mortgage Rates

Credit Rating

Your personal credit score has a lot to do with what rate you will be able to secure for a home mortgage.

So the first step in finding the best mortgage rate is to check your credit report. There are three agencies that track your credit and you can check all three of them from online for free once per year. If there are any errors in the report, work diligently to correct the errors before trying to apply for a mortgage. Sometimes fixing errors in your credit report can take a significant amount of time. Not in the amount of time it takes you in effort, but in lag time between when the request is made and when the credit report is fixed.

Type of Mortgage

The second most important factor in mortgage rates is the type of mortgage. This is where mortgage calculators are a valuable tool. Playing with the terms like the initial amount, length, and interest will give you an idea of what type of loan will be affordable for you. Comparing rates for ARM, 15Yr fixed, 30 year fixed etc is a lot easier when you understand how it will change your monthly payments.

Shopping online for rates is easy and quick, but do not overlook your local banks and credit unions. Shopping local is a great way to support your community and having a person to sit down and explain nuances of the mortgage process can be very valuable. A professional can help steer you in a way you might not have even known existed.

Deal or No Deal

After you've found what appears to be the best deal, use it as leverage and start shopping. Go back to your bank or mortgage brokers that you've had contact with, etc. and see if they can beat it. Even if they can't beat the rate, they might be able to compromise or lower other fees like closing costs. You want the best deal overall, not just the lowest rate so don't settle for something if you're not satisfied.

Be careful of the online lenders, sometimes they have hidden fees or are less than honorable when it comes to making good on the rock bottom rates that they advertise online. Look for consumer feedback to see if the site has good ratings from users.

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