Buying a house has always been a very complex and complicated process, which requires a lot of time. In addition to the current market trend and predictions for next year, there has been an extra level of difficulty added, finding the most favorable mortgage rates.
There are a number of factors that affect the mortgage rate, like the credit score, the type of mortgage, and the down payment. Be sure to use a trusted, reputable a real estate agent, or you may very likely be referred to a list of lenders that may not have the best rates in the market. A good rule of thumb is to do extensive research until finding the most suitable rates and trusted Red Deer mortgage broker for you.
Other tools that will help you is your credit score, polishing it up a little will do you wonders. A good credit score sends a clear message to all lenders, that you are a responsible person and in turn, you’ll be offered the best mortgage rates. Getting your score-up is a task that takes time, but the benefits are worth it.
Making a substantial down payment is another effective way to find the best mortgage rates. Experts recommend a down payment of up to 20% it may sound a bit high, but just like with the credit score, the benefits are incredible. It is one of the easiest ways to get the cheapest rates in the market.
If you are not planning on living more than a few years in your new home, then you may want to consider going for adjustable-rate mortgages (ARMs). They have a low initial interest rate which increases over time. The idea is to sell the house before the rates go up. An alternative to ARMs is a short-term fixed rate mortgage, the monthly payment may be quite higher, but the interests are much less, allowing you to build more equity at a faster rate.
Finally, the last tool is doing extensive research and finding the best mortgage lenders. There are several ways to help you find the right one, the first one is the aforementioned “research”. The second one is to seek your friends and family and ask them about their experiences, not all local lenders have a strong online presence.
These are some of the most effective ways of finding the cheapest mortgage rates in the market according to experts in the field. Once you have your mortgage rate figured out, you will also have to consider your payment frequency on your mortgage. To learn more about the different mortgage frequencies and their benefits click here.