Everybody loves to get a bargain and getting the lowest mortgage interest rate can save you a considerable amount of money over the life of your loan. There are several ways to go about ensuring that you pay a minimum amount of interest when you take a home mortgage.
Be aware of your credit score.
Good credit is key not only to get a mortgage, but getting the lowest interest rates. Mortgage Providers like to reward borrowers who pay their bills on time. Chances are if you’ve been faithful with your other payments, loyalty reward you to pay them back, so they can afford to take a risk on you and offer you the lowest mortgage interest rates available.
Close all existing credit card accounts that you no longer use.
If you have several credit card accounts, they can affect the interest rates on mortgages, even if they have a zero balance. Lenders see open accounts as potential for debt, which adds a risk of them not getting their money back. To offset this risk, the more often you will get a slightly higher interest rate.
Lock in interest rate before closing.
Once you have agreed on a low interest rate, ask the lender to lock in that rate. Rates can vary drastically over the time it takes for you to get your mortgage, which can mean paying a different rate than originally stipulated.
Make the biggest deposit you can afford.
Putting a deposit from your savings to your home, reduce the amount you intend to finance, reducing the interest you pay over the term of your loan.
You do not have to work with the first lender that you approach. With the large amount of online mortgage brokers, it is easy to compare offers and choose the company that offers you the lowest interest rate. Do not be afraid of brokers who can shop around, or ask if they can match the interest of a tender competition to tell.