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5 Tips to Secure the Best Mortgage Rates

Many homeowners can tell you the amount of effort they underwent in order to find the best mortgage rates. Mortgage lenders have different rates with different conditions which can make it quite difficult for you to make the best choice for your needs. In order get the best deal possible, you have to learn from the experts, especially if you are a first time home buyer.

  1. Know your credit report

How often do you check your credit score? You should be checking your report at least once a year. Lenders use your your credit score to determine how much you qualify for and what your interest rates will be. If you want the best loan possible, ensure that you check your credit score prior to applying for a mortgage.

  1. Boost your debt-to-income ratio

One of the most important pieces that lenders always consider when determining the best loan package for you is your debt-to-income ratio. To increase your ratio you should focus on paying down your debt as much as possible prior to obtaining a mortgage rate.

  1. Consider the down payment

In a perfect world you will be able to purchase the house you desire while still being able to afford comfortable monthly payments. The larger the down payment, the less the monthly payment.   A good strategy is to start saving early before you are ready to search for the best rates. You will have better mortgage deals if you can afford to raise 20%, even though lenders still accept down payment as low as 5%.

  1. Know the difference between Fixed and Adjustable rate mortgage

AS a potential buyer you will have a variety of mortgages to choose from.  The most popular mortgagees are fixed and adjustable. A fixed rate mortgage is one which you pay the same amount each month for a number of years based on the interest rate you receive at the time of purchase. Fixed rate mortgages are best if you plan on keeping the house for a long time, if you like to have the security of knowing that your monthly payment will never change and if you keep a steady monthly budget.  An adjustable rate mortgage, or ARM, is one in which the monthly payment changes based on current interest rates.  Payments are typically lower at the beginning of the loan term period.  If you know you are only keeping the property for a couple of years or so, your best bet would be the adjustable mortgage. The risk with an ARM is depending on the current interest rates, your monthly payment could spike considerably without prior consultations from the lender.

  1. Search for the best lenders with low mortgage rates

Not all mortgage companies offer the same rates and types of mortgages.  Do your research on the rates being offered by the different lending companies. With the internet at your disposal you can base your research online, consult with a specialist or even your real-estate agent. Do thorough research and you will be sure to get the best mortgage rate that you deserve.

Securing the best mortgage rate is not an easy process.  The above 5 tips should be helpful for you to find the best rates, and easily own your dream home.  Call the mortgage experts at Florida Real Estate Lending to schedule an appointment with one of our expert loan officers to help you qualify for a mortgage today.



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