Many people neglect their financial conduct when making a mortgage application, and it lowers their chances of success. With the lifespan of a mortgage spanning up to 30 years, getting friendly interest rates set you off to a great start. In fact, the interest rate on your mortgage determines the success of your home owning process. As such, you should dig deeper into the factors that determine the mortgage rates in Ogden and make sure to get them right.
Improve your Credit Score
Your credit score is a summation of your financial conduct and keeping it high is great. A high score entitles you to lower interest rate, translating into considerable savings over the life of your loan. It also keeps your monthly repayments low and affordable, leaving you with sizable disposable income. For instance, getting a home loan of $300,000 with a credit score of 760 entitles you to 3.3 percent interest rate. On the other hand, the same loan carries 4.8 percent interest rates on a credit score of 620. The 1.5 percentage difference could lead you to incur an additional $100,000 bill over the life of the loan.
Pay your Bills
At the very least, your lender needs you to demonstrate the ability to keep on top of your bills, especially rent. After all, they soon join the list of your creditors. As such, you need to impress them with your ability to pay your debts. Unpaid overdue credit card bills and the resultant penalties reflect on your financial records. It is a clear indication to the lenders that you are struggling to stay ahead of your current debt burden. As a result, they are unlikely to indulge your request since you are likely to default on their payments as well. With a myriad of applications coming their way, lenders will prioritize borrowers with a clean financial record.
As much as mortgage application is a business transaction, you need to demonstrate merit when making one. A sound financial history is a great ally that makes the process cheaper and affordable.