Strategies To Lower Your Current Mortgage Rates

Whether you’re a first-time homebuyer looking for the best deal on your first mortgage or a seasoned homeowner who’s about to refinance their current residence, it’s important to understand current mortgage rates and how they work. With some simple math and elbow grease, you can figure out how much money you’ll save by applying for lower mortgage rates today.

If you’re looking to lower your current mortgage rates, a few strategies can help.

Shop Around

Shopping around can mean a lot of things. It doesn’t only mean shopping for the best rates but also the best loan features, terms, and services.

The best way to get a mortgage is by getting quotes from multiple lenders and comparing them side-by-side.

There are many different types of loans available, so you’ll want to make sure that you’re comparing apples to apples when shopping around for mortgages: same term, same rate, fees, etc. otherwise, you won’t know if one lender is offering something much better than another.

Improve Your Credit Score

You’ll need a good credit score to qualify for the lowest mortgage rates. Check with your lender about what kind of score they require for you to get the best deal. If there are any errors on your credit report, dispute them immediately so they can be fixed and removed from your record.

To improve your credit score:

· Pay all bills on time every time! Even if it means paying late fees, it’s worth it in the long run because those late payments will stay on your report and lower it significantly.

· Avoid opening new credit accounts or applying for new loans; this includes student loans and car payments. The more lines of credit you have open at once, the less likely lenders will see you as able to repay them responsibly—meaning they’ll raise interest rates accordingly!

Choose Your Loan Term Carefully

The term of your loan is another factor that will determine the interest rate you pay. Generally, the longer the term of a loan, the lower its interest rate. Conversely, shorter-term loans with higher rates are usually adjustable-rate mortgages (ARMs). These loans have low introductory teaser rates that can go up significantly after several years, making it difficult for borrowers to refinance or sell their homes when needed.

When choosing between fixed or adjustable-rate mortgages (often referred to as FRM’s), consider how long you plan to stay in your home and whether you’re willing to deal with fluctuating monthly payments.

Buy Mortgage Points

A point is a one-time fee that varies by lender but averages around 1 percent of the loan amount. Points are also known as loan origination fees or simply “loan costs”—they’re just another way of saying “interest rate discount.”

If you pay points up front, it will lower your monthly payment by reducing the interest rate for the life of your loan. For example: if you’ve been looking at two different 30-year fixed mortgages with different interest rates and wanted to pick the lower one without changing any other factors like down payment size or credit score, purchasing points could help do so without actually increasing how much money you end up paying overall over time!

Rate Locks

A rate lock, or mortgage insurance, is one of the most important things you can do to protect yourself from rising interest rates. This type of insurance protects you from defaulting on your loan if interest rates increase, and it significantly lowers the risk associated with taking out a mortgage.

Mortgage lenders typically require their customers to put down 20 percent or more when they buy homes. If you have only 10 percent down and find yourself in a position where rising interest rates make paying off your loan difficult, you could lose your property. A rate lock will help ensure that this doesn’t happen by protecting against rising interest rates while locking in an agreed-upon fixed or variable rate for up to one year (depending on the loan product you choose).

We hope this article has given you some helpful tips on how to lower your current mortgage rates. If you want to get in touch with us or learn more about our services, please don’t hesitate to contact us today!