Finding the perfect home is one thing — finding the best mortgages rates is entirely another. Indeed, the mortgage application process can take a long time, be incredibly tedious and strenuous, and quite frankly, very stressful. Home mortgage lenders will go to great lengths to make sure that you will be able to pay them back, and you want to find those low rate mortgages, which will make a huge difference over the life of the loan.
Make sure you follow these tips for finding the best mortgages rates possible:
1. Compare, compare, compare
First, you must find your dream home. Since chances are that you were aided in your search by a real estate agent, you will likely be gently (or not so gently) nudged in the direction of a particular lender — but remember, you decide from whom you take a mortgage. That’s why it’s important to compare mortgages — as many as you can — to get the best deal for your unique financial situation. There are many mortgage rate tools that should help you make easy comparisons, but don’t be too indecisive — lock in a rate as soon as you are comfortable with the numbers, because getting approved for your dream house along with your ideal mortgage can be a long and arduous process.
2. Beef up the down payment
Paying more upfront on your down payment can help you secure a lower interest rate, and save you more money in the long term. This can also be an effective way to counteract a low credit score, which can seriously hurt your chances of getting a good rate. Speaking of credit scores…
3. Clean up your credit score
When applying for a conventional mortgage, having a clean and high credit score is of the greatest importance. The higher your score, the fewer hoops you’ll have to jump through and the better your interest rate. You’ll have more loan choices in general, and adding a home loan to your cache — as long as you make your monthly payments — will only boost your score. This fact is another reason why it is crucial that you stay with your employer during the home buying process, as changes to your employment status can seriously affect your score and your ability to secure the best rates possible. (Read more: How To Check Your Credit Score)
Your dream home — and dream mortgage — are definitely out there!