What is the secret to getting the best rate on your mortgage? What can you do to save yourself the stress and possibly thousands of dollars?
Simple math.
The fact is, when it comes to refinancing of your mortgage, there is only one sure way to have the lowest possible rate, and that is through keeping a good credit score. Those who would like to refinance their homes should also focus more on their credit score. It’s the most effective indicator or qualifier for a low rate, whether or not you plan to get a 15-year or 30-year mortgage. Remember, your credit score is more than just a number. It can be very helpful in attracting lenders, letting them give you the rate that you deserve.
According to the Fair Isaac Corporation, or FICO, credit scores are usually the basis for measuring a client’s risk and his ability to complete the loan. The score ranges from 300- 850, and in order to get the lowest rates, a score of 720 is needed. A score like this does not only mean a qualification for a loan, but also factors in interest rates. Of course, the higher the credit score is, the better rate you get for your loan.
In order to get a good credit score, you want to check your credit regularly. It’s also recommended that you pay your bills on time and avoid drowning in debt as much as possible. Lenders tend to not look kindly on those who owe a big amount of money, whom are aka “credit dependent.”
Credit score not so great?
We all make mistakes and have our financial turmoil. But even if your score isn’t so great, you can still do refinancing in the future, as long as you start protecting your score. Though it may be hard at times, in the long run, it will be worth the wait.
And don’t settle! Today, there exist a number of mortgage lenders in the market. Just like shopping for anything, it is best to look into the available lenders out there. Do not just focus on one lender and settle for what they have to offer. Get the best price on the table. Though interest rates are almost the same from one company to another, look for even the smallest difference as it can make an impact on the amount of money that you have to pay.
In today’s climate, it’s all about being wise. Don’t be in such a rush when it comes to refinancing your home. There are good options for mortgage lenders out there, if you just keep an open mind. The goal of every homeowner is to get the lowest possible interest rate, so better be sure that you have the best deal in hand!
