No matter what the housing market looks like, it always helps to have the lowest interest rate you can get. But when interest rates are on the rise, it is even more important to maximize your rate and get it as low as you can. While some factors impacting interest rates are out of your control, there are a few things you can do to make sure that you get the best possible rate on your mortgage.
Put More Money Down
A low-interest rate can lower the total amount you pay on your home and help you to keep your monthly payments at a reasonable level. One way to ensure that you have the best rate is to put more money down in the first place. By paying points to your mortgage provider, you can get your rate lowered. In many cases, you can choose between a variety of interest rates, which can allow you to find a rate you are comfortable with, and a downpayment that is within your means. Finding this balance can help you to manage your costs more effectively and get more out of your home.
Negotiate
Many people think that they just have to accept whatever rate their mortgage company offers them. However, this isn’t actually the case. You have the opportunity to negotiate your mortgage rate, and this can work out great for you if you know what you are doing. Before you can negotiate effectively, you have to have an understanding of where you fit in as a buyer. You should compare rates before coming to the table to negotiate your rate. That way you can understand what you have to offer and the kinds of rates you should be able to get on your mortgage.
Get on Top of Your Credit
One of the biggest things that can cause your interest rate to rise is your credit score. If you have a low credit score, it will profoundly impact your interest rate and add a lot to your final mortgage costs. You can improve your credit score by paying your bills on time, getting poor marks off your credit report, and increasing the amount of credit you have available as compared to your debt. When you can improve your credit you can make a huge difference in your interest rate. And it’s important to note that even half a percent can be a huge difference in the overall amount you pay.
As you work on securing a great interest rate, keep your goals in mind. Whatever rate you end up with, you should also make sure you pick a home you love. That way you can have a great situation where you have a home you love with a mortgage you can easily take care of each month.
Check out this article on 5 quick ways to come up with a down payment for a home!