Five ways to get the lowest interest rate on your home loan
Tue Nov 29 13:00:00 AEDT 2016
Applying for and securing a home loan can be a long, arduous process. It can be difficult to choose the right home loan for you when you don’t know what other options are out there. And while interest rates are a big factor, choosing the best mortgage for your situation involves more than just finding the package with lowest interest rate.
Here are five ways to improve your chances of securing the lowest mortgage rate:
1. Have a good credit history
Bad credit is a real deal killer when it comes to getting a low rate on your mortgage. If your credit rating is poor, you can expect to be offered a higher interest rate than someone who has better credit. In some instances, you may even be denied a loan.
Addressing your credit issues before applying for a home loan can save you the disappointment of not receiving the lowest interest rates, or missing out altogether.
2. Don’t have lots of debt
Even if you have a good credit rating, having too much debt can negatively impact your chances of securing an affordable mortgage rate. The higher your debt-to-income ratio, the more likely you are to be offered a higher interest rate or less desirable loan terms. Pay down your debt and you’ll increase your chances of getting the best home loan rates possible.
3. Save, save, save
The less money you have in savings or that you can put towards a down payment, the more you'll need to borrow, essentially making you more of a risk. Having a larger deposit is a bargaining tool and can help you offset any unexpected financial problems.
4. Compare loan rates and fees
Not every lender has the loan you need. Comparing rates and other loan conditions and features is a smart way to find the best deal available. Accepting the first rate you’re quoted or choosing a rate based solely on the information provided by one lender can be extremely detrimental and cost you money. Your Choice Home Loans mortgage broker can find you the best home loans to compare.
5. Ask questions
During the home buying process, asking questions is one of your best tools for getting the answers and information that you need. Do not be afraid or hesitant to ask any questions that you may have.
Get the right advice
Finding the right home loan for your situation doesn’t need to be difficult. A Choice Home Loans mortgage broker can help you find the lowest interest rate and the best home loan package for you.
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