Purchasing a home is probably the biggest purchase that Americans will even make. Arranging the whole finance themselves is not always possible for homebuyers. Home loans are the ultimate savior in such a situation. But home loans come with an interest rate, and higher interest rate means, you have to pay more over the life of the loan.
Want to get the lowest mortgage rates in Houston? Worried what to do for that? Here are a few tricks that can help you achieve your wish –
Keep a good credit score
The foundation of getting a low mortgage rate begins with keeping your credit score as high as possible. Mortgage lenders look at your credit score as a roadmap to your creditworthiness. A high score could remove the worries that you could repay your loan, while a low score could entice lenders to charge a higher mortgage rate, or not lent you at all. Check your credit score from three reporting credit agencies and if your score is not good, not steps to improve it, such as paying the debt on time, not applying for new credits, checking for errors, and correct of there is any.
Have a long and consistent work history
Along with a good credit score, lenders also want to see consistent and long-tenured work history. In case, you are working with the same employer for years and have consistent or growing annual income, mortgage lenders will be eager to give you a home loan with an attractive rate. On the flip, if you have changed your jobs several times recently, lenders may not be willing to offer you a big loan as your income is not reliable. Lenders will check your employment status before you make an offer on a mortgage and before the closing date of a home purchase. If you have changed your jobs or quit during the closing process, it can affect your ability to get a home loan.
Shop around for the best rate
One of the smartest moves that homebuyers can make is to shop around for the best mortgage rate possible. With the advent of technology, shopping around is now easier than it was 20 years ago. It is pretty easy to compare the rates of various lenders online to see which financial institutions offer the most attractive rates.
Put more money down
Think how much money you are ready to put down on your home purchase. A small home loan means lenders charge a higher rate to make a decent profit. In the same way, jumbo loans are perceived to carry more risk for the lender. These usually carry a higher interest rate too. You can benefit by coming with a decent down payment on a higher-priced home purchase. Putting enough money down to a lower home loan out of the jumbo loan category saves you thousands of dollars over the life of the loan.
These are some of the easiest tricks that can help you get a home loan with the lowest mortgage rate. So, follow the tricks to get the lowest rate possible for your home loan.
Author Bio: Joan Gallardo, a Senior Loan Officer, with 20+ years of experience, here writes on 2 questions to ask the best mortgage lender in Houston when you are about to choose one of the first time home buyer programs in Houston.