How to Get The Lowest Rate On Your Mortgage

The key to getting the best rate on your mortgage is shopping. Unfortunately most mortgage consumers don't know how to compare one mortgage to another. Let me show you what to compare from lender to lender.

Difficulty: Easy

Instructions

Things You'll Need:

• Your good faith estimate
• This article

1. Compare interest rates. This is the easiest step. You'll find on your good faith estimate the rate of interest the bank/broker is charging you. We are all familiar with what the interest rate is, so this one is typically where people that are shopping for a home loan will start and maybe stop their shopping. However, there are other things to consider.

2. Compare terms. This should go without saying, but, make sure the lenders you selected are quoting you costs and rates on the same product. For instance, a 30 yr fixed mortgage, vs. a 5/1 ARM. Lenders can be very sneaky, so make sure you ask for the product you want, not just a "rate quote".

3. Compare closing costs. This is the hardest item to compare from lender to lender. For a more detailed explanation, go to www.insidemortgagefinancing.com where you will find a line by line explanation of fees etc. There are closing costs, and there are other items payable with a loan that are not considered closing costs. Also, lenders don't determine all the closing costs, so concentrate on the closing costs that your lender controls. Loan origination, loan discount, broker fees, underwriting, processing etc. All the lender fees should disclosed to you on your good faith estimate.

Tips & Warnings

• Download a free report that details lender fees at www.insidemortgagefinancing.com
• Make sure your lender knows you will be comparing their "deal" to other lenders. This will get them motivated to offer you their best deal right off the bat.
• Watch out for the "bait and switch" take your good faith estimate to closing. If any of the lender fees have changed, you need to get an explanation and do not close if there are major changes to your fees, interest rate, or terms of the mortgage.

Resources

• mortgage closing costs
• lawrence, ks real estate

[mortgageinsider]

on 3/6/2009 Tundranut,The best appraisal for underwriting a mortgage transaction will have 3 close comparable sales.In other words, 3 other homes as close to yours as possible that are the same or close to the same, that have sold recently.If the appraiser has to go further away, use homes not exactly like yours, or use old (more than 6 months) sales, then this effects the validity of your appraisal.Make sure you are using a reputable broker, he should know which of his investors (wholesale Lenders)do best with the appraisal.Thanks for your comments. Let me know if you have any other questions.

[tundranut]

on 2/19/2009 I really liked this article. I gave it 5 stars. However I have a question. In this economy, I'm having a great deal of trouble getting an appraisal for a re-fi. The original broker is telling me there are no comps due to no sales. Gotta love Michigan. Anyway, I don't owe that much, but would like to save. What do do? Maybe your next article?