If you’re planning on buying a house, then you certainly need to learn more about the best mortgage rates currently available. That’s because most people have no idea about the wide range of mortgage rates available, but the good news is that after you’ll read the tips below, you’re going to know exactly which one fits your needs best. Let’s check them out:
If you’ve found a home that you’d like to buy, there are good chances the real estate agent who helped you find it will tell you to get a mortgage from a lender he has worked with before. However, since he’s generally only interested in making money, you should take his recommendation with a grain of salt.
Don’t rush this and start looking for a reliable lender who also has rates that you’re comfortable with. At the end of the day, by choosing the right lender you can save up to fifty thousand dollars or even more in interest rates.
Improve Your Credit Score
If you’re applying for a regular loan, then you certainly need to keep your credit in good shape. For instance, based on the rate calculator at myFICO, you could pay as little as 1305 dollars a month if have a credit score higher than 760 and take out a 300 thousand dollars loan in Ohio. As for the interest rate, it would be a bit under 3,3 percent. If you have a credit score of 680, then you’ll pay 1372 dollars a month and have an interest rate of three point six percent. Lastly, with a credit score of 620, you’ll pay 1581 dollars a month and an interest rate of four point eight percent.
Make A Large Down payment
No one says that saving up for a down payment is easy, but if you pay a lot more upfront, then you’ll get a much lower interest rate and save good money along the way. On top of that, you can also save on the cost of mortgage insurance which lenders usually charge if your down payment is lower than the minimum required.
So if you were to put the a twenty percent down payment or 40 thousand dollars on a 200 thousand dollars home in Tennessee, you’d pay only 730 dollars a month for the mortgage. This assumes a fixed thirty-year loan, a solid credit score and an APR of three point seven percent. If you’d scrape 25 thousand dollars, you’d need to pay 798 dollars a month and also seventy dollars a month in mortgage insurance, since you couldn’t put twenty percent down. In total, your monthly payments are going to be a little under 870 dollars.
Amount Of Time You Plan On Living In The House
If you plan on living for a short period of time in your house prior to selling it, go for an adjustable rate mortgage and take advantage of the low initial interest rates of ARM. However, just make sure that you’ll only be living in the house for a short period of time if you want it to work for you and help you save good money down the road.