Best Mortgage Rate Quote Tips
One of the best things about the current
economic situation is the fact that mortgage rates have been very low for a while and the trend seems to be
continuing. This helps people want to purchase a home or apply for a mortgage
refinance. In addition, banks are in a very competitive phase which makes it easier for the average
person to get a lower interest loan.
If you are looking for the best mortgage rate quote around, the following tips
may be of some help.
If you are a borrower with a high credit
score, you will get the best mortgage rate quotes the lenders have to offer. The best scores are in the 740
and up range. To have this type of credit score, you must be making all of your payments on time and keep a
small balance on your revolving credit lines. It doesn't mean you have opened
lots of accounts, just that you take very good care of the ones you have.
If your score is between 680 and 740, you will
still get very good mortgage rate quotes, perhaps just a fraction or two of a percent higher than those with
near perfect scores. Banks will still be offering competitive quotes and you will find that most of the people
who are purchasing homes or planning mortgage refinancing have scores in this range. It is important to shop around
for the best rates as well as lender fees, closing costs and discount points.
Borrowers with credit scores from 620 - 680
may switch from conventional loans to FHA loans in order to maintain a similar rate. FHA loans have a more flexible
credit requirement, and work with people with lower scores than do conventional loans. With a score under 620, you
will want to look at bad credit mortgage loan options.
Always try to compare equal estimates on rate
quotes from different lenders.
The best way to do this is through the Annual Percentage Rate, or
rate takes into account the closing costs and points that the lender charges, so is a better judge or
instance, if one lender quotes a simple rate of 4% with an APR of 5% and another lender quotes a simple rate
of 3.75% with an APR of 5.25%, you should go with the first lender whose APR is
Understanding that your credit score is one of
the largest determining factors in getting the best mortgage rate quote is important. This way, you can work on
improving your score before you go rate shopping.