Everyone loves a bargain and getting a lower mortgage interest rate can save you a substantial amount of money over the life of your loan. There are several ways to go about ensuring that you pay the least amount of interest when you take out a home mortgage.
Be aware of your credit score.
Good credit is the key to not only getting a mortgage, but to getting the best interest rates available. Mortgage lenders like to reward borrowers that pay off their bills in a timely manner. Chances are if you have been faithful with your other payments, you will be faithful to pay them back, so they can afford to take a risk on you and offer a lower interest rate.
Close any existing credit card accounts that you no longer use.
If you have several credit card accounts, they can affect the interest rate on your mortgage, even if they have a zero balance. Lenders see open accounts as potential for debt, which adds a risk of them not getting their money back. To balance this risk, they will often charge you a slightly higher interest rate.
Lock in interest rates before you close.
Once you have agreed on a low interest rate, ask the lender to lock in that rate. Rates can fluctuate drastically in the time it takes for you to get your mortgage and that could mean paying a totally different interest rate than what was originally quoted.
Make the biggest down payment you can afford.
Putting a down payment from your savings on your house, lowers the amount you plan to finance, lowering the interest you will pay over the life of your loan.
Shop Around.
You don't have to work with the first lender that you approach. With the vast amount of online mortgage brokers, it is easy to compare offers and pick the company that offers you the lowest interest rate. Don't be afraid to tell brokers that you are shopping around, or ask them if they can match the interest rates of a competitors quote.
Related Articles
5 Things You May Be Surprised To Know That Help You Get Approved Or A Lower Rate For A Mortgage Loan
By: CL Haehl | 07/03/2007 | Finance
Buy Life Insurance - Although life insurance is not a requirement for most mortgage lenders, it is definitely something that many lenders will take into consideration when evaluating your mortgage application. By demonstrating that you have enough life insurance to cover the mortgage, there is a higher likelihood that they...
Seize the Benefits of Your Home Value
By: Melissa Kellett | 27/05/2008 | Credit
The value of your home already provided finance for its purchase; however, it can do even more for you. It can provide you with additional finance for any purpose you may think of by securing a loan for you. This will provide you with competitive interest rates and low monthly payments so you can enjoy cheap financing.
How to Get Lots of Cash by Refinancing Your Home
By: Leonard Gaither | 05/05/2008 | Mortgage
A refinance mortgage loan can help you get cash for the equity in your home. Home equity refers to the value of the house that has already been paid for. This will include your down payment and the all the monthly payments you have been making. Once you have built up a substantial investment in your home, you can use that to get a refinance mortgage loan, which will give you cash on your equity.
Lowest Interest Rate Mortgage Refinance Loans ? 3 Ways To Get A Low Rate Refinance
By: Carrie Reeder | 29/01/2006 | Finance
The lower your interest rate on your refinance mortgage, the more money you will save. But not all refinance loans are created equal. To get the lowest interest rates, follow these three tips when applying for you refinancing.
Compare Loans- Hunt for the Best Loan Deal
By: Eric | 28/02/2007 | Loans
Most of the FTBs (first time buyers) are unaware of the market interest rates and schemes running on varied loan products. So, the best way out for them is to analyse and compare loans according to their requirements.
Unsecured Loans: More Benefits Than you Think
By: Eric | 16/08/2007 | Loans
It is not only borrowing money that is important. What counts more is that whether your property is safe or not? In case of unsecured loans, your property is not involved and, therefore, these are the safest loans.
1st And 2nd Mortgage Refinance Loan - Why Refinance Both Mortgages?
By: Carrie Reeder | 02/02/2006 | Finance
The hassle of making two monthly mortgage payments has prompted many homeowners to consider refinancing their 1st and 2nd mortgages into one loan.
Buying A Home After Foreclosure - Ways To Get Approved
By: Carrie Reeder | 10/04/2006 | Finance
Before attempting to buy a home after foreclosure, it is important to educate yourself on the necessary steps, and improve your odds of getting approved. Certain situations are extremely damaging to your credit report.
Got a Question? Ask.
Ask the community a question about this article:
Q&A Powered by:
Latest Mortgage Articles
Factors Affecting First-Time Buyers
By: Maxine Clarke | 07/09/2008
The UK Treasury has taken steps to boost the stagnating housing market by rising the threshold for stamp duty to GBP175,000. But what other challenges face first-time buyers?
Foreclosure Process - Understanding The Options You Have To Avoid Foreclosure
By: Peter Johnson | 07/09/2008
The word 'foreclosure' makes many panic - and with good reason. It is important to understand the foreclosure process in that (1) the process takes a year or longer, (2) the bank or lender should be your first port of call, (3) be honest with your bank or lender, and (4) a short sale or deed in lieu can solve the problem. Let me help you better understand foreclosure.
How to Stop Foreclosure on Your Home
By: Jill Borash | 06/09/2008
If you want to know how to stop foreclosure on your home, you have to know what your options are. Here are six ways to save your home from foreclosure today.
Little Known Ways To Stop Foreclosure
By: Ranju Kumar | 06/09/2008
If you are in the same predicament as many people are today, you may be waiting for the banker to show up and tell you he is foreclosing on your property. It does not literally happen that way but the results are the same.
Why New Houses UK Schemes Can Help First Time Buyers
By: Anna Stenning | 06/09/2008
Looking at how newly built houses are a good investment for people buying a property for the first time.
Mortgage Industry
By: MTnews | 05/09/2008
Daily Market Commentary for September 5, 2008 Written for day traders, active traders and investors. A review of the market activity for the day, economic data plus, world news from Millennium-Traders.Com
Impact of Bad Credit on Commercial Loans
By: jeff rauth | 05/09/2008
The impact of bad credit scores on commercial loans has never been so severe. And we’re not just saying that so you read this article. As the commercial secondary market continues to take a beating and local banks that still lend off of their balance sheet cherry pick deals, borrowers credit score are an all too easy lending criteria to “pick on”.
Commercial Mortgage Lenders – Hard Money
By: jeff rauth | 05/09/2008
Commercial hard money lenders fill a giant void in the commercial lending industry. Most commercial lenders are in one way or another tied to banks and their traditional underwriting standards. Commercial hard money lenders are not dependant on banks and fill the void between what banks will not fund and deals that just make no sense at all.
More from Carrie Reeder
Bad Credit Auto Loan Refinance - Reasons To Refinance Using The Web
By: Carrie Reeder | 28/07/2006 | Advice
If applying for an auto loan refinance, there are numerous lending options. Auto loan refinancing is beneficial for many reasons. Yet, several people have never considered this option.
Bad Credit Home Loan Mortgage Services - What To Consider When Applying For A Mortgage
By: Carrie Reeder | 28/07/2006 | Mortgage
Most new homebuyers are unfamiliar with how mortgage loans work. Because of this, several people accept bad loans. This results in homebuyers paying more than necessary. If you have bad credit, accepting a mortgage with good terms is a must.
Low Interest Rate Auto Loan - Increase Chances Of Getting Approved For A Low Rate
By: Carrie Reeder | 28/07/2006 | Advice
Getting approved for an auto loan is easy. However, obtaining a low rate auto loan may be a bit more challenging. When financing any sort of merchandise, the interest rate received makes a huge difference.
Credit After Bankruptcy - Getting A Mortgage With Seller Financing
By: Carrie Reeder | 28/07/2006 | Mortgage
After a bankruptcy, getting approved for a mortgage loan is possible. However, those who apply for a mortgage should anticipate higher rates. To avoid this common pitfall, many choose to delay buying a home until their credit score increases.
Mortgage Companies - Different Types Of Mortgage Lenders
By: Carrie Reeder | 28/07/2006 | Mortgage
If applying for a new home loan, there are numerous mortgage lending options. New homebuyers may not know where to start. Different mortgage lenders fit different circumstances. In fact, choosing the wrong lender may result in paying more interest.
Raise Credit Score - Avoiding Common Credit Mistakes
By: Carrie Reeder | 28/07/2006 | Advice
The majority of people with a low credit score have likely misused credit. Understandably, some people develop bad credit because of situations beyond their control. These may include sickness, loss of employment, etc.
Poor Credit Debt Consolidation
By: Carrie Reeder | 27/07/2006 | Advice
Too much debt is a common problem that affects millions of consumers across the country. Eliminating debt is not an easy task. Yet, there are many strategies in place to help consumers reduce unnecessary debts and save money.
Bill Consolidation Company - The Best Time To Consolidate Debts
By: Carrie Reeder | 27/07/2006 | Advice
Choosing the best time to consolidate debts depends on many factors. Although debt consolidation companies are very effective, many consumers are hesitant to receive help for managing their debts.
Finance 
