A Quick Guide To Securing The Best Mortgage Rates For Your Home

November 29, 2014MortgagesNo Comments »

Definitely, mortgage interest rates will always be a trending topic and you are asking yourself on just how you can get the best deals available for you. However, you have to realize that the mortgage interest rate must be a reflection of your financial needs as well as wants. These financial tools must be treated with utmost importance. Investing in a home is one of those critical decisions you will make in your life therefore, you have to exercise a lot of caution during the entire process. This article gives important and effective tips to better your chances of getting the best mortgage deal fitting your pocket.

Get your credit profile ready

Lenders appraise your credit score prior to advancing you a mortgage and determining which interests are ideal for you. This is what prompts the need to ensure that you review your credit score and ensure that it is in perfect condition. This is because any errors in your credit score report may cause you to be denied a loan. Make sure that you have any discrepancies in the credit score addressed early enough. If it is within your means try getting a credit report six months prior to the day you plan to apply for a mortgage. Additionally, you can also find better ways of enhancing your credit score such as steering away from making too large purchases that may risk your finances.

Plan for a huge down payment

Doing this increases your chances of securing bigger loans with smaller interest rates alongside more lucrative closing fees. Ideally, you should plan for a down payment of utmost twenty percent. However, if you are not in a position to afford a down payment of twenty percent for your mortgage it is advisable to take out mortgage insurance as lenders to woo lenders as they are risking their money extending you a bigger loan.

Reduce your debts

Lenders will also want to establish that you are in a perfect position to pay off the loan in good time. If you have too much debt, then your chances of getting a loan are limited. Therefore, you ought to try cutting down on some of your debts including student loans credit cards among other possible bank loans. Try also to keep the total amount of your accrued loans at least twelve percent of your total income or lower to better your chances. Also cutting down on your debts makes it easier for you to repay your loan as soon as possible.

Learn the mortgage application ropes

The process of getting a mortgage is a vast and uniquely complex one. To advance your chances of securing a loan, you should gain a broad knowledge base in the field of mortgage acquisition. Essentially attend conferences on mortgage application, read blogs, books as well as websites on mortgages and seek the services and advices of expert mortgage brokers to make the process less daunting and less stressful as well.

Submit an accurate and thorough application

It is important that you offer your lender with all the relevant documentation so that your mortgage is processed as quickly as possible. Compile vital documents such as your real estate contracts, bank statements, pay stabs as well as tax returns.

Lock in your interest rates

As soon as you have identified your ideal mortgage rate, it is advisable that you lock in your mortgage at the onset of the application. This will cost you nothing and if a fee is charged you will be refunded the money at the closure of the deal. Betting that mortgage rates will go down prior to closing is not such a good idea.

Consider the length of the mortgage

Thirty-year mortgages are popular with most homeowners. However, if you are in a position to apply for a fifteen year loan then you may do so as the mortgage rates tend to be much higher as compared to thirty year home loans but do not double in the long run. You can use a loan calculator online to make the process of choosing mortgage rates much easier.

Shop around for lenders

Finding the most suitable lender can greatly increase your chances of getting the best mortgage deals. Shop around for different lenders online and physically and find a lender with whom you feel most comfortable working. Most real estate agencies suggest popular or affiliated lending banks but you cannot base your decision entirely on their advice. Give the same credit score information to different lenders of your choice and have them send over mortgage quotes to you, compare their rates and see which the best for your unique needs is. You can make the process much easier by opting to work with an online mortgage broker instead. Ensure you work with one who is highly dependable and reputable so they can negotiate for you the lowest mortgage rates in Montreal.

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