Mortgage rates are still fluctuating and have dropped to new highs this week. According to Freddie Mac’s Primary Mortgage Market Survey, long-term US mortgage rates hit 3.92% recently.
If you’re a homeowner or are thinking of buying a home, now may be the time to lock in a low rate. Mortgage rates have been on the rise lately, but don’t worry – we’re here to help! Our mortgage lenders can walk you through the process of securing a mortgage, whether you’re looking for a long-term loan or a short-term fix. We’ll work with you to find the best rate and terms that fit your needs.
Here are a few smart tips on how you can get the best deal on your home loan:
Enhance your credit score
Mortgage lenders are more likely to offer you a low-interest rate on a home loan if your credit score is good. It’s a good idea to aim for a credit score in the mid-700s or above. Start by paying all incoming invoices on time if you haven’t already, as this will improve your payment history. Also, if it’s possible, try to pay off some existing credit card debt. This will lower your credit utilization ratio, which is another important aspect of your credit score.
Finally, check for any mistakes in your credit report. Debts in your name that you never actually built up could be pulling down your score, and rectifying them could swiftly raise it.
Apply for a 15-year loan
The lower the interest rate, the shorter the term of your mortgage. Many people are hesitant to take 15-year loans because they have larger monthly payments. However, if you can fit a bigger payment into your budget, you’ll save money on interest not just on a monthly basis, but over the life of your loan.
It’s best if your debt-to-income ratio is as low as possible
Mortgage lenders Los Angeles look at your “debt-to-income (DTI) ratio” when analyzing mortgage applications. DTI compares how much money you make to all of your monthly obligations. Lenders look at your debt-to-income ratio to evaluate if you’ll be able to afford your monthly mortgage payment.
If your debt-to-income ratio is high, you’re more likely to have trouble making your mortgage payments. A risky loan is one with a debt-to-income ratio of 43 percent or greater (including your projected mortgage payment), and many types of mortgages, including those from Fannie Mae, have a maximum debt-to-income ratio of 50 percent.
Paying off debt can increase your chances of qualifying for a mortgage and getting a better rate. Before qualifying for a mortgage, spend some time reducing your credit card balances or paying off loans.
Do some research
The more lenders you contact during the mortgage application process, the better your chances of securing a low-interest rate on your loan. You’ll be able to compare the rates you’re eligible for and find the best bargain once you’ve received many offers.
You can also be able to use the offers of other lenders as a negotiating weapon. For example, suppose one lender provides a lower interest rate than others but charges greater closing expenses or the fees you’ll pay to complete your loan. You might wish to choose a lender that charges lesser closing expenses.
In that instance, you should take your better interest rate offer to a lender with lower closing fees and urge them to lower their rate. If that lender is interested in your business, it may be willing to work with you.
If the circumstances are right, consider an ARM
You lock in your interest rate for a fixed amount of time with an adjustable-rate mortgage, or ARM, and then it might rise. Clearly, there are drawbacks to this approach, one of which is that your rate will climb.
The advantage of acquiring an ARM is that you’ll almost always be able to acquire a lower interest rate at first. If you’re buying a starting house or a home you won’t be staying in for a long time, an adjustable-rate mortgage may make sense and save you money on interest.
A low-interest rate on your home loan might save you a lot of money. To make your mortgage as reasonable as possible, use these tips.
Contact PierPoint Mortgage and Save Thousands on Your Mortgage!
Mortgage rates have been on the rise since the beginning of the year. If you’re a homeowner or are thinking of buying a home, you’re probably wondering if now is a good time to lock in a low-interest rate. Don’t worry when it comes to mortgages, PierPoint Mortgage is the top choice in the area.
We have knowledgeable and experienced staff who are dedicated to finding the best mortgage products for our clients. We work with the best mortgage lenders to ensure that each and every client is satisfied with their experience working with us. Come and see for yourself why PierPoint Mortgage is the best mortgage company around!