Home Loan Interest Rates
Get pre-approved for a mortgage to find out what your payments will be. Shop around and find out what you’re eligible for so you can determine your price range. Once you figure this out, it will be a lot easier to see what your monthly payments should be.
Thinking of buying or building that perfect home? Before you sign on the dotted line some research into home loan interest rates will be needed. This will give you a much better chance of obtaining some interest rate savings.
Check Your Credit Report Before You Apply For A Loan – It Is Free
Before you try to get a mortgage, check your credit report to make sure there are no errors or mistakes. The ringing in of 2013 meant even stricter credit standards than in the past, so improve your credit rating so that you have the best chance to get qualified for the best loan products.
To begin finding the best home loan interest rates you will want to study the current rates and rate movements or trends. Home loan interest rates generally reflect the over-all picture of interest rates. They basically will follow Wall Street Securities with their rise and fall.
If you’re working with a home that is worth less that the amount you owe and you can’t pay it, don’t give up. HARP is a program that allows you to refinance regardless of how bad your situation may be. Speak with your mortgage lender to find out if this program would be of benefit to you. If your lender says no, you should be able to find one that will.
Rates & Status
Home loan interest rates combined with your individual financial status would then determine how much you can borrow. This would have an impact on how much house you can buy. Higher interest rates would mean you may have to settle for a bit smaller home than you originally had planned.
Avoid spending lots of money before closing on your mortgage. Lenders tend to run another credit check before closing, and they could change their mind if they see a lot of activity. Wait until the loan is closed on your mortgage before running out for furniture and other large expenses.
To Pay Points Or Not
One of the things that you may consider to lower your home loan interest rates is to consider if you are willing to pay points or not. A point is 1% of the total loan amount. It is the up front fee that would reduce your monthly interest rate and the total amount of interest over the length of the loan. By paying points you are essentially buying your way to a better rate and trading between paying now vs. paying later. Paying points should only be considered if you plan on keeping the loan for at least four years. The reason this is suggested is because it gives you time to get back the upfront money with the lower monthly payments.
What To Do When You Are Denied
Your application might get denied in the final stages due to sudden changes to your finances. You should have a stable job before applying for a loan.
Another factor to consider in regards to home loan interest rates is the length of the loan. A typical 30 year mortgage will have a higher interest rate than that of a 15 year mortgage. The 30 year mortgage will have lower monthly payments but you would pay thousands of dollars more in interest rates over the life of the loan than that of a 15 year mortgage.
Create a budget so that your mortgage is not more than 30% of your total income. Paying a mortgage that is too high can cause problems in the future. Keeping your payments manageable helps you to have a good, orderly budget.
Also, a higher down payment will have a positive effect on your home loan interest rate. This down payment would typically need to be 20 percent or more. This would furnish you with more equity in your home, giving you a much better interest rate.
You might want to hire a consultant to help guide you through this process. A home loan consultant can help make sure you navigate the process. They can also make sure you get the best possible deal.
Most lenders offer a variety of options to help assist you with home loan interest rates. When shopping around, make sure you are looking at comparable points and rates among the different lenders.
Make extra monthly payments whenever possible. Additional payments are applied directly to the principal balance.
One Last Consideration About Interest Rates & Mortgage Facts
One of the final things to consider with a home loan interest rate is whether you want a fixed rate mortgage or an adjustable rate mortgage. A fixed rate is fixed throughout the life of the loan. With this kind of loan the interest rate stays the same. The other, a variable rate, has the possibility of going up or down. By paying points you are essentially buying your way to a better rate depending on the current market.
If you are having troubles with your mortgage, then find assistance. Counseling might help if you are having difficultly affording the minimum amount.There are various agencies that offer counseling under HUD offices around the United States. A HUD counselor will give you foreclosure prevention counseling for free. Call or look online for a location near you.
Interest Rates & Mortgage Facts Homework
Do your homework on home loan interest rates, choose between one of the many programs offered and then decide on how much of a down payment you can afford. In the long run this research will pay off handsomely for you.