How to Find The Best FHA Mortgage Rates

Learn how to find the best FHA mortgage rates.

Are you in the market to purchase a home, or to refinance an existing mortgage?

If you are, the hunt begins for a pre-approved mortgage loan with the lowest interest rate possible.

The hunt is much easier nowadays, thanks to the Internet.

If you are unfamiliar with an FHA loan, there isn't much difference from a conventional loan except for the fact that it's a federally insured loan.

Typically FHA loans requirements are less strict than a conventional loan.

The following tips will help you find the best FHA mortgage rates.

Difficulty:

Moderately Easy

Instructions

1. Realize you have more power to determine your mortgage loan interest rate than ever before. Today, you can shop around for the best mortgage rates, and avoid dealing with a mortgage broker, who may not have your best interest at heart at all times. In the past, any deals you had were dependent on the mortgage broker, and the quotes he or she would gather from a few preferred lenders. This method of finding a mortgage heavily favored the broker and the lending institution.

   Now with the competition inherent on the Internet, lenders must compete for your business, and you can shop around, and in some cases, even negotiate a lower interest rate.

2. One of the most important steps in finding the best FHA Mortgage rate is to figure out how much loan you can afford on a monthly basis. Make this a realistic assessment of your financial ability to pay the mortgage principle, property taxes, loan interest, private mortgage insurance (if you put less than 20% down), and any other costs associated with your property.

3. Look up online rate tables. Online rate tables are easily accessible to anyone with an internet connection, and a few URLs to lending institutions. You can find out interest rates on fixed or adjustable-rate mortgage loans, second mortgage loans, and FHA loans.

4. When you are ready to approach the lenders you have chosen during your mortgage loan research, one of the first things they will ask you is "do you know your credit score?" Tell them that you don't know your score. Here's why: if you tell the lender you do not have your credit score, they will pull it for you.

   In addition, you can ask them what your score is, so that you have that information handy with other lenders. This will cut down on the number of inquiries into your credit file, which lowers your FICO score, especially if several lenders look up your FICO score. My suggestion is get a copy of your credit report and FICO scores prior to applying for a loan (see resources below for a link).

5. If you follow through on these few bits of advice, you will be well on your way to securing an FHA mortgage loan for an amount you can comfortably afford. The more knowledge you have about mortgage loans, the better deals you will be able to find.

   While you're here be sure to take a look around for more tips and information about finding the best FHA mortgage rates.

Resources

• Get a copy of your FICO score and credit report