One of the best reasons to buy a property now is the affordable mortgage interest. It may increase moderately in 2018 after dropping to all-time lows for years, but it will still make home ownership within reach for a while. But even if interest rates these days are generally good, you can still make them better. Here are the best tricks to do it:
1.Get Your Credit Score as High as Possible
Credit scoring remains the number one indicator of creditworthiness in any lender’s book. Before you contact the best mortgage company in Utah, Texas, or any state you live in, call credit reporting companies first. If your credit score is lower than 740, make the necessary improvements to put yourself in a better position to negotiate for lower rates.
2. Keep the Term Short
Experts would attest that the interest rates of 15-year, fixed-rate loans are about 1/4 to 3/8 percent lower than those of 30-year, fixed-rate mortgages. Shorter terms are less risky to lenders because they collect higher monthly repayments, which help pay off the interest faster.
If you plan to move after a few years, though, a hybrid loan program — a mix of fixed- and adjustable-rate mortgages — might be for you.
The larger the sum you put down, the less money you have to borrow. A smaller loan size might compel your prospective lender to provide you with a better rate. Moreover, you can get rid of the private mortgage insurance if your down payment is at least 20% of the property’s cost.
4. Pick a Single-Family Home
The last real estate crisis saw the condominiums depreciate more than single-family houses. Lenders like to have low-risk assets to absorb low losses in case of another housing market crash.
The best way to negotiate with a mortgage lender is to think like one. Your ability to empathize can be your ticket to your dream home and save you thousands of dollars.