Wednesday, September 30, 2009

What Is Today's Mortgage Rate?

When you ask a mortgage professional what his rate is, you must first know if you are rate shopping or evaluating a professional. Borrowers shopping for the lowest rate are almost always guaranteed to pay more for their loan - either in rate, fees, or both. Borrowers who are evaluating what mortgage professional they want to work with are much more likely to get the best loan available for their needs and circumstances. That is, if they understand how to make their evaluation.

A lender who blindly quotes a rate, who responds immediately to your rate question with "4.75%" or "I can get you 4.x", is being dishonest at worst & disingenuous at best. Mortgage rates are not like produce prices, posted in the grocery store for all to see and available to all buyers. Many factors go into getting the best mortgage for you.

Some factors are based on your circumstances:
  1. Your credit score
  2. Your down payment (or loan-to-value for refinances)
  3. The amount of your loan
  4. Are you ready to lock your rate now?
  5. How long before you need to close?
  6. Are you a teacher, veteran, policeman, fireman, first time home buyer, etc?
Other factors are based on your needs:
  1. How long do you plan on living in this home?
  2. Do you plan on refinancing in the future?
  3. Do you prefer a lower payment or lower costs?
  4. What is your tolerance for risk?
Only an open, honest conversation with a mortgage professional will illustrate how each of these factors influence the mortgage rate that is available on the best loan for you.

If you are in the market for a home now and would like to discuss your situation or if you have a home and would like to see if you can save by taking advantage of rates near historic lows, contact me. There is no obligation. You owe it to yourself to see what a proper mortgage interview can do for you.

Tim Epps

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