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You deserve the best mortgage rate, but do you know how to get it?

You obviously don’t want to pay any more for your house than necessary. Something as small as a quarter percent decrease can save you thousands of dollars over the life of your loan. If you want to make homeownership as affordable as possible, use these tips to get the best mortgage rate.  However, please resist the temptation to bargain shop… all lenders are not created equally and make sure you are working with an experienced lender who will be able to perform.  In addition, all loans are not the same, so when comparison shopping please make sure you’re comparing apples to apples.  Many lenders will promote lower rates and then you’ll find yourself with hidden costs along the way.  Make sure you understand all of the costs so there are no surprises.

1. Save Up. The more money you can put down on your home, the more you reduce the risk for your lender. They’ll pass that reduced risk onto you in the form of a lower interest rate. It’s worth taking a few months (or longer!) to save up for a decent down payment so you can score a lower rate.
2. Work On Your Credit. Speaking of your risk as a borrower, how do lenders decide it? They look at a number of factors, but one of the biggest is your credit score. The higher the score, the more financially responsible you seem. If you want a great mortgage rate, aim to have a score of 760 or more. You can improve your score by aggressively paying off your existing debt, automating payments to make sure you never miss a bill, and keeping all of your lines of credit open. You can calculate your savings as your score increases with this handy calculator.
3. Shop Around. You wouldn’t buy a car without comparing its cost at different dealerships, would you? So why would you make an even bigger financial decision without shopping around? Compare rates from a few lenders to make sure you get a competitive rate, but more importantly, work with an experienced lender who is able to communicate well and outlines your options in a way that makes sense to you.  You’ll also want a lender who works cooperatively with your Realtor to best position you to be a successful buyer!  For instance, will your lender proactively call the listing agent to emphasize your qualifications?  You’ll want a lender who completes your real estate “dream team”.

Once you’ve got the mortgage you need with the rate you deserve, it’s time to get to the fun part! Keep more of your hard-earned money in your pocket by home shopping with a negotiations expert. For all of your home buying needs, contact Jenn Blake Real Estate Group at Pacific Sotheby’s International Realty in San Diego, California at 858-663-6788.