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How to Shop for Mortgage Rates

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by: No more debt !
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Date: Sun, 10 Aug 2014 Time: 10:31 PM
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How to Shop for Mortgage Rates

 

The purchase of a home is often one of, if not THE, biggest purchases you will make in your whole life. Due to this, you want to make sure that you have the best possible deal you can have when you get your mortgage. The mortgage rate you get is a major, major factor in how much your mortgage will cost and especially the size of your monthly mortgage payments. Depending on the rate you get, you might have a manageable monthly payment or you might have a payment that is beyond your means. 

It makes a lot of sense to shop around for your rate. Why would you settle for the first thing that came to you for a decision this big? Do your homework, find who is offering the best rate for the loan you want and in your area, and use the help of a mortgage professional, like a certified mortgage broker.

So how do you go about shopping for the best mortgage rates?

  1. Find your credit score. If you do not know it already, find out. Get a copy of your score from the major bureaus and examine your report. Look for any mistakes that might be on there that should not be. Also, if your score is lower than you want it or where it needs to be, then take some steps to improve it. This is a great way to score a good mortgage rate.
  2. Look at the mortgage structures. There is more than one type of mortgage out there. Also, figure out how much you will need to borrow because this will impact the type of mortgage you get. The three most common mortgages people get these days are:
    1. Fixed-rate mortgage: With this mortgage, you have the same rate throughout the lifetime of your mortgage. This is about as straightforward as mortgages can get. However, this type of mortgage often features the higher rates since it is much more "safe".
    2. Adjustable-rate mortgage: This one features a rate that changes from time to time. Often times, you have a fixed rate for an intro period of a year or so and then the rate is allowed to change based on an index of times and ranges.
    3. FHA- This is a mortgage from the Federal Housing Administration. For first time buyers, this is what they usually get since it is easier to qualify. The borrowing requirements are less strict.
    4. Look at multiple lenders. This is the best way to shop around and see who is offering the best rates. A great way to do this is to use a broker.
    5. Negotiate. You can try to get your rate lower by doing some negotiating. If you have found better rates elsewhere, see if they will match them.

 

If you have any questions about buying a home and mortgages, then contact TrueFi.

 

About the Author

We are mortgage brokers that specialize in refinance and purchase loans. We service CA, CO, & VA. We make the process easy so refinance or buy through us today!


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