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Find the best Mortgage Rate for you
by: Kent Clarke
Most people tend to take out a mortgage, then forget about it. The monthly
payments go out from their accounts every month, but they probably couldn't
tell you what the interest rate was if you asked! This is slack financial
policy - it is easy to make sure you always have the best mortgage rate,
and therefore pay the least interest. And believe me, over the years,
even a fraction of a percent reduction in interest rates means big savings!
You need to get in the habit of noticing current interest rates. This
is especially true if you are currently in the market for a new mortgage.
Generally, mortgage rates track the central banking system's 'base rate',
but there are a LARGE number of deals for new customers, including early
year discounts, fixed rates, capped rates and so on. If your mortgage
company isn't offering you a competitive rate, but other mortgage lenders
are, confront them with it! Often they rely on your disinterest to keep
overcharing you interest (excuse the pun!). When confronted, they usually
crumble and will offer you a better deal rather than lose your custom.
Always use the APR when comparing loans. The APR (Annual Percentage Rate)
allows you to compare the loans offered by different mortgage lenders
in a like for like manner, and shows you the true cost of the loan as
a yearly rate. This stops lenders hiding 'extras' (such as upfront fees)
behind a fog of low rate claims, and means you have the true rate to play
with. generally, most house hunters get an approval in principle from
their chosen mortgage company. This makes you more attractive to sellers
because it shows you are serious, and have the financial wherewithall
to proceed should you decide to try and buy their house. It will also
give you a firm indication that of what your budget is (although most
lenders have slackened their rules in recent years, they still apply SOME
rules!). This pre-qualification will keep you in the right price bracket
too, and stop you wasting time on properties beyond your reach. If you
meet the lender's criteria, try to lock in a rate. This means the lender
promises to hold their offer for you at a certain rate for a certain time
while you proceed with the purpose. Variable rate mortgages, more popular
in Europe, can be crippling if rates rise from the historically low rates
prevalent at time of writing.
For the next step, consult www.mortgagedown.com and get that mortgage
down!
About The Author
Kent Clarke writes for several websites, including www.mortgageDown.com
- the place to get your mortgage down, free!
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