Ever wondered just how to obtain the lowest mortgage interest rate? If so, you are in luck. Today I am going to share with you some simple steps that will allow you to do just that.
Never in all my years have I had a client come to me and tell me “Jimmy, please give me the highest mortgage interest rate that you have.”
I have however, (multiple times a day) had clients tell me “I want the best interest rate possible” …and you know something, there is absolutely nothing wrong with that.
The truth is that we should all want the lowest mortgage interest rate because it can literally save us tens of thousands of dollars in interest over the life of the loan.
First off, let’s touch on credit scores. The single greatest factor to obtaining the lowest mortgage interest rate has to be credit score. Simply stated, the higher the credit score, the more competitive the interest rate.
The good news is that if your credit is less than perfect or could use improvement there are multiple ways to increase your score. Contact us at the contact info below for more details.
Now let’s move into down payments. Down payments can help you obtain more competitive interest rates when purchasing a home because the lender may view their investment to you (the money for your home) as less risky. So, it pays (if you can do it) to put money down – ideally 20% if possible.
Now, if you are nowhere close to having a 20% down payment, not to worry as there are multiple loan programs available on the market that will allow you to put as little as 5, 3.5, or even 0% down.
Lastly, another way to obtain the lowest interest rate when purchasing a home is paying points.
If you have never heard of the term “paying points” it’s simply this: paying money to the lender at closing to obtain a lower mortgage interest rate over the life of the mortgage loan. This will allow you to have a lower rate of interest over the life of the loan thus allowing you to save money long term.