The Real Estate Encyclopedia
How Can I Make Sure That I Am Getting The Best Interest Rate?
Category - Home Buying Questions - General Home Buying FAQ's

To get the best rate on a mortgage loan, you need to 1) be sure you have an excellent credit history or improve your credit rating (see how do I repair my credit) and 2) shop around by contacting several mortgage brokers or lenders. As you shop, keep in mind that the mortgage with the lowest interest rate may not be the most convenient mortgage for you. As an example, you can lower your interest rate by paying higher points if you have the upfront cash. But, if available cash is an issue, a higher interest rate with lower points may be preferable for your particular financial situation.  Do keep in mind that a higher interest rate will cost you thousands of dollars over the life of the loan. 


You may also get a lower interest rate by taking a "30-due-in-seven" mortgage.  In this case, the mortgage payments are equal to a regular 30-year mortgage, but the loan has to be paid off in seven years, either by selling the house or refinancing). This mortgage may carry a lower interest rate, but it may not be for you if you plan to stay in the house for more than seven years.

Mortgage Questions - Mortgage Loans FAQ's
Home Buying Questions - General Home Buying FAQ's
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