Tips to Getting the Best Mortgage Rate Possible
You may have heard that interest rates are on the rise again, and it’s the truth. But we’re still experiencing some of the lowest interest rates of all time. So don’t worry, rising rates won’t affect your ability to get a great mortgage rate. If you know you’re going to buy a home soon, here are some things you can do to prepare for financing a home, and get yourself the best mortgage rate you possibly can despite rising interest rates.
3 Tips to Get the Best Mortgage Rate
Increase Your Down Payment
It’s always a good rule of thumb to put 20% down when purchasing a home. However, saving up enough for a down payment is one of the hardest parts of buying a home. With that being said, if you can be diligent in saving for your down payment, you can secure yourself a lower interest rate. If you were able to put more than 20% to down on your home, a lender could reward you by giving you a lower interest rate. The more money you’re able to put up for the down payment, the lower your interest rate will be. Keep that in mind when you’re figuring out what your budget is.
Improve Your Credit Score
When you’re in the process of buying a home, having a solid credit score really helps. It could even save you thousands of dollars over the life of your loan. When you purchase a home, you’re going to have to submit a copy of a recent credit report during the pre-approval process. If your credit is above a 740, you have nothing to worry about. But if you have a credit score that is below a 740, this could potentially cost you some points on the interest rate. If you know that you’re going to be purchasing a home in the coming months or years, getting your credit score to above a 740 will save you in the long run. Don’t give lenders an opportunity to give you a higher interest rate. Improving your credit score is one of the easiest ways to get the best mortgage rates available.
Shorten the Term of the Loan
A 30-year fixed mortgage is one the most common kinds of loans that potential homeowners get. But there are so many options available to you if you can think outside the box. When it comes to financing, there are all kinds of trick things you can to do save yourself money in the long run. If you have the ability to increase your monthly payment while still living the life you want to live, it could be a great idea to consider shortening the length of the loan. Going with a 15 or 20-year loan will lower your interest rate considerably, and will help you build equity in your home faster.
Purchasing a Home in Orange County
When you’re purchasing a home, you want to have a strong team around you. The home buying process always has a few bumps along the way, but the goal is to make it as seamless possible. I have been serving Orange County for more than 15 years and helping all kinds of different people purchase homes in this wonderful area. If you want to purchase a home in Orange County, I can help you. Contact me today to start the home buying process.
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