When a potential home buyer sets out to purchase a home, the primary goal is to make it as affordable as possible, so securing a mortgage with the lowest possible interest rates, fees, and closing costs will save the buyer thousands of dollars before and after they are handed the keys to the front door. It requires a bit of planning and preparation, as well as some knowledge about the application process as a whole to land the best deal. Following these smart strategies below will assist in making this a hassle-free experience.
Evaluate the Credit Scores– A good credit score can open quite a few doors toward getting the most affordable interest rates and loan choices. Check with the three credit bureaus to find out where credit ratings stand. Determine whether or not there is any incorrect or outdated information to adversely affect the score, and take measures to improve or eliminate any derogatory influences.
Find the Best Mortgage Rates– Spend as much time investigating all the available mortgage rates as is spent looking for the right home to buy. Banks and lending sources offer a wide range of rates and fees, on and off-line, and the best rates could save hundred of dollars on monthly payments, and thousands in closing costs and up-front fees.
Determine the Affordability Factor – To keep from underestimating the true costs involved with owning a home, it is wise to also factor in the costs above and beyond the monthly payment, which may or may not include the property taxes or homeowners insurance. Make good use of online mortgage calculators to determine the loan affordability based on monthly income and expenses.
Get Pre-Approved – To meet the more stringent demands of today’s credit requirements, ask any lending institution to pre-approve the qualifications for the mortgage. The lender evaluates the credit history and credit scores, income, savings, and debt obligations to provide a mortgage qualification rating and funding amount, which elevates the credibility with other lenders and financing resources.