To work towards your dream of buying yourself a home, you will probably want to secure the lowest interest rate possible for your home loan. In order to combat today’s higher rates and lock in the lowest one you can, here are a few factors to work on.
Your Loan Type
Lenders can decide which products to offer, and loan types have different eligibility requirements. Rates can be significantly different depending on what loan type you choose.
Your Credit Score
Credit scores can play a big role in your mortgage rate. When you build and maintain good credit, mortgage lenders have greater confidence when qualifying you for a mortgage because they see that you’ve paid back your loans as agreed and used your credit wisely. That’s why it’s important to maintain a good credit score.
Your Loan Term
Another factor to consider is the term of your loan. When choosing the right home loan for you, it’s important to consider the length of time it will take you to repay your loan before you fully own your home. Your loan term will affect your interest rate, monthly payment, and the total amount of interest you will pay throughout the loan term.
Your Down Payment
If you’re a current homeowner looking to sell and make a move, you can use the home equity you’ve built over time toward the down payment on your next home.
Generally, a larger down payment means a lower interest rate, because lenders see a lower level of risk when you have more stake in the property. So if you can comfortably put 20 percent or more down, do it—you’ll usually get a lower interest rate.
Conclusion
When buying a home, the best thing you can do at the early stage of the process is to have an experienced real estate agent by your side. Connect with our real estate professional, Rose to receive a personalized guidance and assistance designed to meet your specific goals.