Best Mortgage Rate Quote Tips
Interest rates for mortgages,
even bad credit mortgage loans, are very low which has been incentive for more people to buy houses or apply for
a mortgage refinance. Obtaining a low-interest
mortgage is also easier for a borrower because banks are competing for their business. Here are a few tips for
singling out the best mortgage rate quotes.
The best mortgage
rate quotes are given to the borrowers with highest credit scores. These scores fall into the 740 – 800+ range. To get the best mortgage rate, your credit needs to be
stellar. Anything less than a credit score of 740
means you will take a hit in interest rates. You
don’t have to have a lot of credit to get a high credit score. If you have revolving credit or credit cards,
keep as much available balance open as possible, pay your bills on time, and over time your credit score can
rise to these levels.
Interest rates for
scores less than a 740 are still only a fraction or two higher than the best rates. Borrowers with a credit score in the range of 680 to 739 are
still going to benefit from banks competing for their business. The majority of people mortgage refinancing and buying houses
have credit scores in this range. Mortgage rate quotes will be competitive, so shopping not only rates but
lender fees, discount points and closing costs is advantageous to the borrower.
Loan programs for
people with credit scores in the range of 620 – 679 are going to take the biggest hits in rates. Borrowers in this range may opt for an FHA loan because loan
programs and rates are comparable to conventional loans, with more relaxed credit requirements. For people with scores under 620, loan programs are almost
interest rates quoted by different lenders, be sure you are comparing apples to apples by comparing the lenders’
Annual Percentage Rates (APR). This is how to tell if a rate quote includes discount points, origination fee and
other lender fees. The APR rate also factors in
closing costs. Comparing the APR rates rather than just a simple interest rate allows people to compare lenders’
rates in an educated way and confirms which quote is actually the lowest. The lowest-quoted APR has the best mortgage rate over the life
of the loan.
To get the best rate
quotes, it’s good to know that your credit score is a big determining factor. Maintaining a high credit score is important for anyone
wanting a mortgage and makes mortgage interest rate the lowest they can be. With the variety of loan programs available and low interest
rates, borrowers can choose which bank they want to do business with.