7 Tips on Getting the Best Interest Rate for Your Mortgage
Are you getting the best interest rate for your mortgage? Many homeowners aren’t. We all want to get the best interest rates possible and keep more money in our pockets. But too many people rush through the mortgage qualification or renewal process.
Considering how much money is involved, it’s amazing how little research and effort is put into the process. You can change this with these 7 tips to get the best interest rates for your mortgage:
Shop around and compare your options
You have mortgage interest rate options. You need to shop around and compare your options to get the best rates. This means not just taking the interest rate your bank offers or renewing your mortgage without taking the time to see what the market has to offer. Failure to shop around can cost you thousands of dollars in interest fees.
Work with an experienced mortgage broker
The bank can only offer you their mortgage products. A mortgage broker can shop around and find you the best mortgage rates available based on market conditions and your personal financial situation. Brokers give you options and have access to many mortgage products. They can help you find a mortgage solution that meets your specific financial needs.
Improve your credit rating
Whether you are shopping for your first mortgage or renewing a current mortgage, a good credit score will help you get the best rates. Work on improving your credit; pay down your credit card and other loans before applying. Having a good debt to income ratio will give you more leverage when negotiating terms.
Increase your down payment
This is particularly important when purchasing a home. The more money you put down, the better. Today, this means putting down 20% or more. You are viewed by lenders as having a strong financial situation, and this will result in a lower interest rate for your mortgage loan.
Consider a variable rate mortgage
Variable rate mortgages tend to have lower rates than fixed mortgages. However, if you choose a variable mortgage, you need to understand that your rate could change up or down based on market conditions. This means your mortgage rates and costs could increase. If you do not have the budget to handle an increase in rates, this may not be the option for you.
Negotiate mortgage rates
Most people assume the posted mortgage rates are set in stone. This is not always the case, especially with the banks. Don’t just take the rate offered to you without at least inquiring about getting a better mortgage rate. You may be surprised to see how much of a better rate you can get. Your mortgage broker can help with negotiating rates.
Consider other factors
Keep in mind that mortgage rates should not be the only thing factored into your decision. The level of service and terms and conditions for your mortgage also need to be considered when choosing a mortgage rate.
Learn more about your mortgage rate options with us. Contact our expert team of mortgage brokers today to explore your mortgage rate options.