If you have finally gathered enough money to make a down payment on a house, you will need to start shopping around for a mortgage. You will find that the interest rates offered by lenders will tend to vary greatly. This is why you need to do research in order to find the lowest interest rate available in your area. Finding a low rate can save you literally thousands of dollars during the time you are paying off the mortgage. Here are some tips you can use to find a low interest rate for your mortgage.
1. Compare apples to apples
You will first need to determine the number of points that are contained within the various mortgage offers that you look at. A single point is a fee that is the equivalent of one percent of the entire amount of the loan. You need to be certain that you compare the amount of points that are contained in all of the mortgage offers you look at.
2. Get as many mortgage offers as you can on the same day
Interest rates will often fluctuate on a daily basis. Because of the rapid changes that can occur in the world of mortgage interest rates, you will need to find out what the current interest rate is by either looking online or calling each lender individually. Do not simply rely on the interest rates that are in ads that you see on TV, radio or in print. There is a good chance the rate has already changed significantly.
3. Understand when you should lock yourself in
Once you lock yourself into a specific mortgage interest rate, the lender is legally obligated to continue to offer you that rate. Even if interest rates go up significantly after you lock yourself in, the rate you locked yourself in at will remain unchanged. You will be able to lock yourself in for different lengths of time. One to three months is the usual length of time that people lock themselves in for. However, if you want to lock yourself in for longer than three months, it is possible to do so. However, it will cost you additional money that will be in the form of points. The longer the lock-in period, the more points it will cost you. Fixed rate home loans from NPBS are also available, if you are interested in a loan with a rate that never changes.