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Top Tips to Get the Best Mortgage Rates

Buying a house is a major financial decision and one that will cost you a lot of money in the long run. If you’re about to take the plunge and buy a house, it’s a good idea to get the best mortgage rates, because saving even half a percent on the interest rate can save you thousands of dollars over the course of the loan.

Here are some of the best tips to consider to get the best mortgage rates and to find the best mortgage lender.

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Top Tips to Get the Best Mortgage Rates

Tip # 1: Make Sure You Have a Great Credit Score

The first thing mortgage lenders consider when giving you the best mortgage rates is your credit score.

The higher your credit score, the more likely you will get the best mortgage rates because it shows lenders that you’re less of a risk to default on your mortgage loan.

But according to consumer reports, a credit score higher that 760, will certainly qualify you for the best mortgage rates.

So before you’re thinking of applying for a mortgage loan, get a free credit report. A free credit report will help you know what your credit score is and also you can review your credit report for any mistakes.

If there are any mistakes on your credit report, correct them immediately.

Second, start thinking about how to raise your credit score. One way to improve your credit score and maintain it is to avoid applying for a new credit. Each time you apply for new credit, it’s another inquiry added to your credit report.

Several inquiries can decrease your credit score.

So in order to qualify for the best mortgage rates, raise your credit score to 760 or more.


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 Tip # 2: Save for a Larger Down Payment.

The typical down payment for a house is 20% of the home purchase price. But if you put down more than 20%, you’ll more likely be qualified for the best mortgage rates.

So if you’re thinking of buying a home in a year or 2, set up a high-interest savings account for you home down payment.

You can transfer money into the savings account each time you get paid. Or you can set up a direct deposit to transfer the money automatically.

Tip # 3: Shop Around for a Mortgage Lender that Offers the Best Mortgage Rates.

Mortgage lenders offer different mortgage rates. So it’s a good idea to shop around and compare offers from different lenders.

That way you can find a mortgage loan that suits you and don’t rely on just one source. Do your homework by researching and visiting different mortgage lenders to find out their mortgage rates.

Or you can use a mortgage calculator to compare lender and mortgage rate terms.

Tip # 4: Make Sure You Have a Stable Job.

You’re less of risk if you can show to lenders that you’ve been employed for at least two years at least for the same employer.

So before you apply for a mortgage loan and to get the best mortgage rates, make sure you have a steady employment for at least two years.

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Work with the Right Financial Advisor

You can talk to a financial advisor who can review your finances and help you save 100k (whether you need it to pay off debt, to invest, to buy a house, or plan for retirement, saving, etc). Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

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