Increase Your Chances of Getting a Lower Rate

Shellabrate Summer!

Summer is just around the corner, and it’s arguably the busiest and hottest season of the year to purchase a home.  One of the top questions I get when discussing the topic of home ownership is, “Where are mortgage rates currently?”  Although quoting an exact rate on the spot is nearly impossible unless you have all of the person’s financials in front of you, the simple answer is that rates are still fairly low based on historical data.  Despite not having control over market conditions, borrowers can maximize their ability to get better rate pricing by keeping the following information in mind.

Credit Score:  Higher Number = HOT

This is a big factor when pricing rates – the higher your credit score, the better pricing will be.  It’s always a good idea to obtain a copy of your credit report every year from each of the credit bureaus – Experian, TransUnion, and Equifax.  California law requires that each of these bureaus provide a free credit report copy once a year to consumers who request it.  This allows you to review what is being reported for accuracy.  Contact me today for a free 8-page report on tips to improve your credit score.  Keep in mind, that paying off debt or bringing accounts current may take a month or two to reflect on your credit so it’s best to pay what you can as soon as you can.

Loan-to-Value ratio:  Lower Number = HOT

Another consideration is the home’s loan-to-value ratio or LTV.  This is calculated by taking the initial loan amount and dividing it by the appraised value at funding.  A simple example would be if you purchase or refinance a home that appraises for $100,000 and your loan amount at the close of escrow is $80,000 then your LTV would be 80%.   Lenders often tier rates based on a property’s LTV and offer better rate pricing for homes with a lower LTV.

If you are looking to lower your current interest rate or trying to find the best rate to purchase a home, contact me for a free consultation and evaluation.  Saving money is always hot and I can help you reach that goal!

© 2017 Marilyn Quindo

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