25 Apr Getting the Best Rate for Your Mortgage
Naturally, you want to get the best deal for the least amount of money. This holds true for mortgage rates as well.
A lower interest rate means a lower monthly mortgage payment, which can save you money in the long run. Also, it is easier to qualify for a lower payment than a higher one.
You basically have two routes to finding the best rate. The first is to do all the research on your own. The second is to use a mortgage broker.
Mortgage Broker (Recommended)
If you do not have the time or experience to “do it yourself,” look for a qualified mortgage broker that can assist in finding the right mortgage for you. Ask your Realtor or friends and associates who have refinanced or purchased recently if they have a broker they can recommend. You’ll want to find a broker who is energetic, flexible, and knowledgeable about finance and loans, as well as someone who has your best interests in mind. I personally like the ones who are willing to take your call on the weekends since that is most likely when you have the time to review your options and home shop! Contact me direct, I have a short list of trusted lenders who I highly recommend.
When comparing loans, make sure that you’re comparing loans of the same type. For example, you find that “Loan A” for a 30-year loan has a much lower interest rate than “Loan B” (also for 30 years).
Upon further inspection, you find that “Loan A” is technically an adjustable rate mortgage. Its payment is based on a 30-year amortization, but is due through either payment or refinancing at the end of 5 or 7 years.
These are frequently referred to as a 5-year or 7-year fixed-rate mortgage. While both said “30-year,” they are not the same type of loan.
Ask the lender for a statement detailing all fees associated with the loan. Factors such as “points” (loan fee), interest rate, and “garbage fees” (extra fees which some lenders charge) can vary greatly from one lender to another.
Do-It-Yourself
With the advent of the Internet, much of this information is readily available online. Once you have educated yourself sufficiently about real estate loans, all it takes is the time and energy to sift through online resources to find the information you need.
Rates change quickly. The great rate you find today might not be there tomorrow. Once you find the rate you are looking for, submit a loan application and lock in that rate.
Some sources for interest rates on the internet include:
When comparing loans, make sure that you’re comparing loans of the same type. For example, you find that “Loan A” for a 30-year loan has a much lower interest rate than “Loan B” (also for 30 years).
Upon further inspection, you find that “Loan A” is technically an adjustable rate mortgage. Its payment is based on a 30-year amortization, but is due through either payment or refinancing at the end of 5 or 7 years.
These are frequently referred to as a 5-year or 7-year fixed-rate mortgage. While both said “30-year,” they are not the same type of loan.
Ask the lender for a statement detailing all fees associated with the loan. Factors such as “points” (loan fee), interest rate, and “garbage fees” (extra fees which some lenders charge) can vary greatly from one lender to another.