If you’re planning on buying a home in the Las Vegas area, chances are good that you will need a home loan to help. However, home loans vary in several key ways, including interest rates, duration, and the lender’s fees and terms. Just as you would take the time to shop around for any other item, like a car or clothes, you’ll want to shop around for the right loan to purchase your home. 

Why Shop Around for a Home Loan?

There are many reasons to shop around for loans in Las Vegas. When you’re looking for loans, you might think it’s too much of an effort to apply for multiple loans, but the positive aspects of searching for a loan outweigh the negatives. 

Here are just a few of the benefits you’ll get by shopping for a home loan: 

  • Ever-changing rates
  • Interest rates can increase
  • No credit impact
  • Different fees

One advantage of shopping around for a home loan is that interest rates fluctuate. Additionally, you might hear different things from others about interest rate trends. Interest rates can stay the same, but they can also rise or sometimes even fall over time. What’s even more confusing is that some people will tell you interest rates are rising, while others say they’re stagnant or even at historic lows! No matter what you hear from others, the reality is that interest rates are constantly changing, and it can be very difficult to know what interest rates will be in the future. Since interest rates are subject to change, your best chance of getting a lower interest rate is to buy a home loan at a time when interest rates are low. Even if it means you’ll need to wait a bit longer to get a loan, your wait is worthwhile, as getting a lower interest rate means that you will be paying less for your loan over time. 

Another reason to shop around for loans is that Las Vegas mortgage rates can add up over time. The change in interest rates that you see might seem insignificant, as interest rates rarely change more than a fraction of a percentage point. However, even though that chance may seem insignificant at the time when you’re buying a loan, those fluctuations can add up. First-time home buyers are especially prone to fall for the fact that interest rates add up more than they appear to do. To put numbers into perspective, a half-point change, or less, on your interest rate can amount to a difference of thousands of dollars over the course of your loan’s term. 

No Credit Impact 

Unlike other financial inquiries that you make, shopping around for a mortgage rate will not impact your credit rating. Now, all three of the major credit bureaus in the US treat mortgage inquiries as just one inquiry, even if you make more than one. Historically, they treated each mortgage inquiry as separate. The catch is that all inquiries must be made within a certain period of time, which is typically 30-45 days. That number varies based on the credit bureau. 

Different Fees 

Another consideration when you’re getting a mortgage is that there are certain fees associated with it. The fees that you’ll have are usually points and origination fees. Origination fees are fees that cover the costs associated with closing your loan, which may include compensating the loan officer. As with any industry, it’s good to keep in mind that lenders vary in their fee structure. Points are optional, and you might even be able to negotiate with your lender to have some fees discounted or waived. If you shop around for a mortgage, you’ll find the fee structure that is right for you and your personal home ownership circumstances.

How To Get a Mortgage 

How To Get a Mortgage 

When you’re first shopping for a mortgage, there are some considerations you’ll need to think about. 

First, how much of a down payment can you afford? The general requirement for a down payment is 20%, but you may be able to get away with a lower down payment depending on the loan that you get. Some loans are available to people who qualify, such as veterans and those in rural areas, with a lower down payment. If you qualify for a loan with a lower down payment, be sure to speak with a loan officer first, as there might be some conditions about getting a lower down payment that you’ll want to figure out first before you decide to settle on a loan structure. 

Another thing to think about is your credit. You can get credit reports annually, and you have the opportunity to look them over and fix any errors that might be on them before you take out a home loan in Las Vegas. Additionally, if you find that you do have errors or think you have errors on your credit report, you can raise those issues with whatever credit bureau is involved. 

Get a Quote 

If you’re shopping around for mortgages, one of the best things you can do is get quotes from multiple brokers and lenders to compare their fees and rates. You’ll want to know some fees ahead of time, like the monthly payment, interest rate, and APR, which is the cost you pay annually for credit. The APR includes various expenses such as mortgage insurance and other credit costs. The APR is one of the most important factors to consider with a mortgage, and knowing the APR makes it easier to compare different aspects of a loan as you compare offers.

What About Negotiations?

When you’re thinking about mortgages, you may be able to make some negotiations. You might be able to negotiate some terms of your mortgage, but you’ll need to ask your lender if that’s something that you want to do. There are some things you can ask a lender about, including waiving one or more of their fees, or agreeing to a lower mortgage rate or one with fewer points. Additionally, you’ll want to make sure that a broker or lender is not agreeing to a certain lower rate while increasing the cost of another fee, which also adds points.

How to Figure Out the Best Offer

You may have to do some investigating to figure out which loan offer is the best. In order to do so, you’ll need to first figure out your total payment. The interest rate determines how much you need to pay each month in interest, but you will also need to figure out your monthly mortgage payment.

If you have questions or need help getting a home loan, contact us today.