A fraction of a percentage point might not sound like much, but it can make a big difference in the overall cost of your mortgage.
To make sure youre getting the right rate for your needs, compare lenders rates online and through a loan officer. Theyll be able to help you find the best loan program that meets your goals.
Online
One of the best ways to find out if you can get the mortgage of your dreams is to compare lenders’ rates. You can use an online tool to compare loan offerings or you can consult with a loan officer or both. They will be able to recommend mortgage products that best suit your needs, including the most suitable loan term and repayment amount. To ensure you are getting the lowest rate possible, it’s a good idea to discuss your financial situation with your lender, particularly before you sign any documents. They will be able to suggest ways to improve your chances of getting the best deal possible, such as making payments on time or avoiding costly fees like prepaid interest.
The most difficult part of the process will be determining which lenders to choose from and which to avoid. Once you’ve narrowed it down to a handful of finalists, you can start the application process. Most lenders offer a simple online application, where you can fill out a form and receive a free quote. The next step is a phone call or an in person appointment with your lender to discuss your financial needs and goals. The lender will present you with a detailed quote and answer any questions you may have.
Through a Loan Officer
Loan officers are employees of a bank or lending company who can help you compare lenders’ rates. They go by many names but all work to help you find a mortgage solution that fits your needs and financial situation.
They screen borrowers and make sure they qualify to receive a mortgage loan before they pass the application to an underwriter. They also evaluate applicants based on their credit history and other factors.
A good loan officer will go above and beyond the numbers to offer recommendations that can increase your chances of being approved for a mortgage. Their advice is based on their knowledge of the mortgage industry and the different types of loans available.
They also track important deadlines and help you close your loan on time. This includes ensuring you don’t end up paying expensive extension or relock fees when you lock your rate.
Through a Broker
A broker is a financial professional who helps you compare different lenders’ mortgage rates. They act as middlemen, connecting you with a lender and gathering information from you to submit to the lender for approval.
Brokers can be helpful in challenging financial situations such as those involving income or credit issues. They can help you determine the right loan amount and terms and point you in the direction of a lender that will approve loans for borrowers with less-than-perfect credit histories or inconsistent incomes.
But brokers’ fees can be costly, and their services may not always be the best option. A broker that gets paid by the lender may be more likely to push you to sign with a lender who pays them a high commission, even if it means paying more for your mortgage.
When comparing mortgage rates, get a full cost of each loan estimate including points and fees. This will give you a more accurate picture of your overall costs.
Through a Bank
Comparing different lenders’ rates can help you find the best mortgage for your situation. However, it’s important to remember that each lender’s rate is calculated differently and depends on a lot of factors like your credit score, loan terms, down payment size and home location.
Even a small change in your mortgage rate can have a large impact on how much you pay over the life of your loan. Bankrate’s mortgage amortization calculator shows that a 0.1 percent change in your rate can mean thousands of dollars extra paid out over time.
Whether you’re shopping online, with a loan officer or through a broker, comparison-shopping is the most effective way to get the mortgage that suits your needs and fits your budget. That’s why we encourage all borrowers to shop around for quotes from several lenders before applying.