Getting a Good Mortgage Rate

Thursday, July 26, 2012

Getting a Good Mortgage Rate

The mortgage world can become very confusing due to the many products that are available. When trying to find the best possible rate, consider following few simple steps to help you get the best mortgage rate.

Your Personal Finance

Get familiar with your whole personal financial status. You should be aware of the following information before talking with any mortgage lender.

·         What is the amount you can afford to spend monthly on house payments
·         what are your available funds for down payments and closing costs
·         what is your credit score

Consult with mortgage lenders and make your financial situation known. When a lender is familiar with your capabilities, he can offer you different products along with different rates.

Overall Costs

When looking at available mortgage products, keep in mind that the lowest rate is not immediately the best one for your financial status. Be certain to ask about the overall and total cost of each product over the life term of the loan. It can be confounding to see that even a low rate loan can cost you thousands of dollars more over a life term of the loan.

After reviewing the whole cost of a loan, ask about the overall closing cost for each loan. The closing cost is a required fee by a lender to carry out legal process of transferring the property ownership onto your name. If you are told that there aren't any closing costs, you should get alert. If not included as upfront costs, the closing cost will be included in your loan and will cost more than necessary in the long run.

No Closing Costs

If you have been told by your lender that your credit score is preventing you from getting a better interest rate on the mortgage, inquire about how you can make your credit score better. Some degree of flexibility such as - purchasing time frame and few months of you paying off debt will make positive change on your credit score.

When you have analyzed the total cost for each loan product, including your closing cost and credit rating, you are ready to complete the procedure of deciding the correct mortgage by inspecting each of the choices presented to you. Depending on the information that has been gathered, you should be able to achieve the best available loan.

Credit Scores

Keep in mind that an acceptable rate for you may not mean the same as an acceptable rate for someone else. A credit score has a compelling impact on your capability to get the lowest possible rate. A score that is above 680 will normally receive a lower rate. In the event that you have incurred errors on your credit report, you should make efforts to have them investigated and possibly removed.

Many will argue that getting the best possible rate requires little luck and a lot of preparation. Request a copy of your credit report; you are entitled to 1 free annual credit report.
·         620 or greater is good
·         675 or greater is better
·         750 or greater will permit a negotiation for lower rate

Author’s Bio:

Sam Adams has written the article. He regularly writes for

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