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Mortgage Rate Lowest - Tips for Making Sure That Your Mortgage Rate is the Lowest it Can Be

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With mortgage rates at their lowest they’ve been in years, many people are in search of that great deal, but if you don’t do a little work first, you might find that you’re stuck with a higher rate than you bargained for.

You see it all over the place. Advertisements for “Low mortgage rates,” “Now is the time to buy your dream home,” “Mortgage rates the lowest they’ve been in decades.” All of these statments might make you think that even a poorly prepared borrower could land a great deal on their mortgage rates, right? Wrong. The truth of the matter is that even though mortgage rates are at an all time low, so is the ability tGOget them.

Good credit might not be good enough
In the past, depending on where you lived and your lender, it might have been good enough that you have a decent credit rating to get the mortgage you sought. Not only could you get a mortgage with a mediocre credit score but you could also get that loan without having to put any money down.

These days, in order to get the mortgage rate that’s the lowest it can be you might have to do a little more work. Credit scores now have to be higher than ever before. So that score of 680 that might have gotten you a loan five years ago just won’t pass. Try to get your credit score up to about 750 for the lowest rates.

The more money you put down, the better
Not so long ago, people could get a mortgage even if they didn’t put any money down, but the rules have changed. When it comes to getting mortgage rates that are the lowest around, potential lenders feel that the more the down payment, the less likely you are to walk away from your property. Their rationale is that since you put money into your home before you even made your first payment, you will work harder to make your home payments on time.

You might be able to get a mortgage under some programs with reasonable interest rates and only have to put about 10% down, but in order to get a mortgage rate that is the lowest out there, you should plan on putting down about 20% of the total cost of the home. Yes, it’s a big chunk of change, but it could save you thousands of dollars in interest payments over the life of the loan.

Clean up your credit at least six months before you buy
Most people who have good credit don’t check their credit regularly, but it is so important that you check your credit report about six months before you’re planning to purchase your home just in case there is anything on your report that makes your score dip a little bit. This is a good time to clear out all inaccurate information and try to get that one late payment from two years ago removed.

Also, when you’re planning in advance to ensure that the mortgage rate you get is the lowest possible, consider dropping any credit card balances to 30% or less of the total available credit and paying off as much of your car loan as you can. This will help your lender to see that you are a very low risk borrower and that’s what they’re looking for right now.

Looking for a great way to boost your credit scores a little more? Conisder “piggybacking” off a friend or family member who has really great credit for a while. This is one of the best ways for you to quickly and easily add points to your credit score that you might really need. In order for this to be completely effective for you however, it’s important that your family member gives their creditor all of your information, including your social security number, full name and date of birth.

Essentially, when you piggyback off your friend or family member with excellent credit, you are using their good credit habits to boost your credit scores. Since any account you are piggybacking should have your essential information included, the payment history of the account will show up on your credit report as an authorized user.

If you are trying to make sure that your mortgage rate is the lowest that it can be, you should plan ahead and take a few important steps before you even try to get that essential financing for your new dream home. You can take advantage of rates that are at an all time low as long as you know what steps to take.

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