Because the average interest rate on a typical 30-year mortgage has dropped over 1% in the past two years, many people are deciding that now is the perfect time to purchase a new home. When it comes to Mortgages Spanish Springs residents can get even lower interest rates by following a few simple steps. Keep reading to discover some easy ways you can save even more money on Mortgages Spanish Springs.
Spruce Up Your Credit Score
According to industry experts, raising your credit score by as little as 30 points can have dramatic affects on the interest rate you’ll receive on a mortgage. One easy way to get a quick boost on your FICA score is to pay off some of the balance on your credit cards. Balances that are over 25% of your total credit limit can be very unattractive to financial lenders. Also, spend the months before buying your home making sure you pay utility, cell phone and cable bills on time each month. It’s surprising to many people how much a history of late payments can affect their credit score.
Pay Your Car Loan Off First
If your car is financed, it’s a good idea to pay it down as far as you can before you try to get a mortgage. These loans increase your debt-to-income ratio, and many mortgage lenders will consider you to be a risky candidate. Because of this increased liability, your interest rates will be higher. The same logic applies if you’re still paying off student loans. Spend time getting the balances on these loans as low as possible.
Increase Your Down Payment
If you’re credit isn’t perfect, you can still get an attractive mortgage rate by putting a larger-than-usual down payment on a home. Standard down payments are typically 20% of the home’s selling price, but if you can afford to pay more it could save you money on interest rates. To banks and other financial lenders, a bigger down payment means less risk on their part. This will often mean lower interest rates for your mortgage. Increasing your down payment as little as 5% often gets results.
When it comes to Mortgages Spanish Springs residents should follow the tips above to get the best interest rates possible. These tips, combined with the current buyer’s real estate market and low average interest rates, can help you get a better house at a great price.
