When it comes time for you to think about getting a mortgage, you should know that there are some things that you can do to help yourself get a better deal. In most cases, they can be performed over a few months, but will prove their worth in savings over the term of your new mortgage. Here are some of those things.
1. Look Over Your Credit Scores
You need to get a copy of your credit report from the big three (Equifax, Experian, and TransUnion) and look them over for wrong entries. It is not uncommon for items to be mistakenly reported on a credit report. It will only take, however, one item to adversely effect your credit score. Bring it up to where it should be by trying to correct anything that is not where it needs to be.
2. Raise Your Credit Levels
If you find that your credit really is not at the level where you feel it could be, take some time (if you can wait) and raise it. This can be done through credit cards that report to the credit bureaus, taking out short-term loans and paying them off on time and quickly.
This could be a key factor in getting a mortgage worth having. The interest rate that you will be able to get is largely based on your credit scores. Generally all three scores (or more) will be averaged and that is the figure that the lender will base the calculations on.
3. Reduce Your Total Indebtedness
It is always a good idea to reduce your indebtedness before applying for a mortgage. While you can have indebtedness, and even bad credit, you get the best rates when your indebtedness is about 28% of your income or lower. Having more than this will limit the size of your mortgage possibly more than you want. While it may be possible to get a different kind of mortgage, such as an ARM, it may not be the best in the long run - depending on what kind.
Reducing your debt will prove your ability to pay. You can pay off some credit cards and other small debts by consolidating them with 0% APR interest credit cards for their introductory offer, but you really don't want to close all of those credit cards. Leaving one or two open, perhaps even with small balances, could be more helpful to your credit rating than closing them all down.
4. Get A Larger Down Payment Ready
This will help you tremendously by reducing the overall amount that you need to borrow. The more that you can put down means that you are less of a risk to the lender. They will trust you more and give you a lower interest rate. Your goal should be somewhere in the vicinity of about 20%, if possible.
Another way to save when you actually start shopping around for your mortgage is to compare a number of mortgage quotes. Look for the best deal after you understand the terms and your various options. Even if you do all of the above to help get the best rate, you could lose it simply by signing on to the wrong deal - so be careful.
Got a Question? Ask.
Ask the community a question about this article:
Frequently Asked Questions
What happens with the stocks now in fannie may ...
By: warren scroggie | 08-09-2008
what happens with the stocks now in fannie may,freddie mack.
What Is The Difference From Yhe White Coffee ...
By: frakthepug | 08-09-2008
What Is The Difference From Yhe White Coffee Filters From The Non White Coffiee Filters?
I wont to buy land and put a house on it but ...
By: RaeKing85 | 08-09-2008
I wont to buy land and put a house on it but wonted to wait and see what the bail out does to the market is that smart?
Closing costs
By: Gary | 08-09-2008
We make a good living with excellent credit scores but little in savings for closing costs. I know they just stopped the closing cost assistance program but is there any other way besides seller assist to pay for the closing costs?
Credit Card Company Unfairly Raised Rates
By: bluyu | 08-09-2008
I have a perfect credit history and no credit card debt... yet my credit card company just raised my rate to 29%!!! What can I do?
Property when not married
By: kelsey | 07-09-2008
my fiancee' and I have been together for 10 yrs, though MD does not recognize Common law marriage. House is in his name, though since it's purchse, we split all expenses 50/50. His will indicates I would get the home if he died first. I fear his ex wife would attempt to take it for the children. Anything we can do to to assure this doesn't happen, short of getting married?
Q&A Powered by:
Latest Non-Fiction Articles
Book Marketing: the Day That is Different for Your Career Strategy
By: Rosey Dow | 06/10/2008
Make an informed decision about the direction of your writing career--print or online, or both.
In the Lap of the Gods 22
By: Steve Morgan | 05/10/2008
For those who have read the other 21 chapters
A Week in the Life of the Single Working Mother
By: Karen Dosw | 03/10/2008
A humorous article about a week in the life of one South African, single mom with two adult children and two little ones.
Why You Should Write for Free
By: Deborah Owen | 01/10/2008
Write for free? I can hear you saying, “Are you nuts?” Write for free, so you can get paid. Read more inside.
Why You Should Write for Free
By: Deborah Owen | 01/10/2008
You asked if they had a job opening. They said no. They told me “no”, too, but I got the job anyway. Read more inside.
Becoming a Reporter is Easy
By: Deborah Owen | 01/10/2008
Do you want to be a reporter? It’s a great way to break into print, and the jobs aren’t that hard to get. Read this article to learn more.
Writing it Down
By: Galina Nemirovsky | 29/09/2008
Lately I’ve developed a compulsion to write everything down. Stringing words together and composing sentences in the shower, I want to write it all down – remember it – capture it. I stare at people in the subway and craft their character descriptions in my head...
The Modern Lily Tomlin
By: Galina Nemirovsky | 29/09/2008
I’m waiting in a conference room that smells like the corner of career aspiration and stale office carpet. The overly heavy and overly bitter receptionist has a voice that is piercing through the makeshift conference room with walls that only go up about 7 feet. Like an annoying hiccup, she keeps repeating “Good morning, Hudson. Your name? Hold please.” Over and over again. She is an extra large version of what the rest of the world has automated already.
More from Joseph Kenny
Debt Consolidation - Getting A Loan To Solve A Problem
By: Joseph Kenny | 22/05/2007 | Non-Fiction
When you find yourself with your finances just about out of control, then it is time for you to consider debt consolidation. One workable solution to the problem of just too much debt is to take out a personal loan.
Do You Need A Personal Loan And Have Less Than Perfect Credit?
By: Joseph Kenny | 22/05/2007 | Non-Fiction
Many lenders are in serious competition with each other to be able to give you a loan. This means that it may be easier than it has been in the past to get a personal loan. Competitive pricing and interest rates may make it nearly an ideal time.
How To Get An Instant Approval Credit Card - Fast
By: Joseph Kenny | 22/05/2007 | Non-Fiction
Many things in our lives these days are fast, and that makes for great convenience. We like our food to be fast, our lines to be short, our cash to be instantly accessible at an ATM, and service to be quick. Our TV programs need to be solved in an hour, or two for a movie.
How Can You Assume A Mortgage?
By: Joseph Kenny | 22/05/2007 | Non-Fiction
Finding a house with an assumable mortgage these days could prove to be a real find - but it is not very common. Typically only the FHA and the VA uses assumable mortgages, which basically means that another person can simply take over the house and payments.
A Home Equity Loan Or A Home Equity Line Of Credit?
By: Joseph Kenny | 22/05/2007 | Non-Fiction
When you need the cash out of the equity in your home, you may find that there are a few choices that are before you. Should you go with a home equity loan, or would a home equity line of credit (HELOC) be better?
Have An Adjustable Rate Mortgage - Need To Remortgage In A Hurry?
By: Joseph Kenny | 15/05/2007 | Non-Fiction
Most people are probably aware that interest rates have been on an upward trend. For those who have fixed rate mortgages it does not really matter. But if you have an adjustable rate mortgage, then you may already have seen an increase in your payments.
Unsecured Personal Loans - A Loan For Everyone
By: Joseph Kenny | 15/05/2007 | Non-Fiction
Unsecured personal loans may be the way for you to get the money you need - especially if you do not have a good credit rating. Lenders are available who will be glad to give you the money you need - and it is possible to get a sizable loan, too.
What Information Is Needed To Apply For A Payday Loan?
By: Joseph Kenny | 13/05/2007 | Non-Fiction
Payday loans are very convenient. You can easily apply for one online in just a few minutes or at your local payday loan store - which may go by one of many names. While still easy to get, you will want to have the necessary information handy to make the process go much smoother.
Writing 
