It is an admitted fact, that checking the rate different banks offer is not the only thing customers consider before approaching a lender to borrow money. There are certainly other factors such as choosing the lowest available rate, an important thing to think about before having a final thought about the one to whom we are going to approach for a loan.
Comparing mortgage rates of different States?
Let me give you a quote an example of a home loan in Los Angles, California. If you are planning to take a loan, please check for the rate of interest you have to pay to get a loan. If you log onto aimloan.com, a direct internet lender, input all the required information to get a quote. Let me quote my example. I needed cash of $2,00,000 to purchase a property. I have a credit score is 740+ and it is a 30 year fixed interest rate loan. You would also have to select the option, place of residence. Now, let us see how much ROI it will show for the state of Kentucky? It will show an average of 3.4 as the rate of interest. On the other hand, for a 30-year loan with a fluctuating rate of interest is even lower. It is only 2.8 on an average.
It is worthwhile to note that the rate of interest was 4.3 % during the year 2014 and had a steep fall to 3.9% the same year. Now, it is around 3.8 at the end of 2016 for the same 30-year-old loan. If you are also planning to take a loan, this is the correct time to go ahead with your plan.
What are the ways to find out a better rate of interest?
1) Compare ROI of different banks.
2) Boost up your credit score.
3) Increase the amount you pay as initial payment.
4) Think about how long you want to live in that house.
Let us now understand it a little better.
1. Compare ROI of different banks: It is quite natural for anyone to approach a mortgage broker to finalize a deal with a bank that gives loan at the best rate of interest. He would advise you to approach a bank with whom he is associated with or the banker with whom he is able to earn the best. Take input from that. But, don't forget to compare the banks before finalizing any plan.
2. Boost up your credit score: Before searching for a bank that will provide you the best rate of interest, try to improve your credit score. It is a matter of simple understanding that the better your credit score is, the bigger your loan amount will be. The banks extend loans to those they consider is safe to deal with.
3. Increase the amount you pay as initial payment: Try to save as much as you can for making a down payment. If you pay a bigger amount as down payment, you would be able to get a loan that charges a lower rate of interest. In turn, it will fetch you a mortgage insurance policy with a low rate of interest.
4. Think about how long you will live in the house: If you are going to live in the new house for a relatively short period, consider opting for an adjustable rate loan. This is because initially, they charge only a low rate of interest. When it starts to increase, sell it.
These are the ways to find out the best mortgage rate in 2018.