How to Get the Best Interest Rates for Your Mortgage

Purchasing a home is likely going to be one of the largest investments that you make in your lifetime. While the costs are always going to be high, you could end up paying significantly more than you want to by selecting a mortgage loan with high interest rates. Lower interest rates equate to lower monthly payments on the mortgage. If you want to obtain the lowest rates possible, there are several steps that you should take throughout the process.

interest rates mortgage

Mortgage Interest Rates Hacks

Focus on Improving Your Credit Score

The best way to get lower interest rates on the mortgage loan that you select is by taking the necessary steps to improve your credit score. The difference between a score of 650 and a score of 750 can be substantial in the rates you’re able to get. A higher score shows the lender that you’re more likely to pay back the loan over time. To start improving your score, make sure that you pay all of your bills on time and that you don’t use more than 30 percent of your credit limit. If there are any errors on your current credit report, try to get them removed before you apply for a mortgage loan. (Read more on how  to get funding to remodel a home.)

Save More for a Down Payment

Another great method for getting lower interest rates is by making a higher down payment on the home. While any down payment above 10 percent is fantastic and will help you get a lower rate, the ideal percentage is 20 percent of the mortgage loan, which should greatly reduce your monthly bill. If you don’t quite have enough liquid cash to make such a large down payment, consider saving up for another six months or year.

Consider Different Types of Mortgages

While the most common mortgage type is a 30-year fixed-rate mortgage, you might want to consider an adjustable-rate mortgage instead. While it’s possible for the interest rate to eventually increase, there’s also a good chance that it will lower over time, which may be a risk worth taking. If you want to find the ideal mortgage loan for your home, it’s recommended that you hire mortgage brokers in Las Vegas to assist you with your search.