While gone are the days of cheap mortgages, it is still possible to strike a favorable deal if you turn to the right place. The Average Percentage Rate of the average mortgage was marked 5%, the highest value in a decade. With recent attempts to push up short term rates, it is right to conclude that the cost of mortgages will keep on increasing. Nevertheless, mortgage loans are cheap based on historical standards. You are only required to shop around and settle on one that perfectly fits you. Most of the financial analysts think that irrespective of what the national average may be at any given time, it is possible to find lower rates.

The problem is that consumers are often reluctant to shop around for the finest deals. Most of the homebuyers get intimidated by the involved process and just accept whatever appears to be the easiest, in most cases the offering from their local banks. Smart buyers will search through the market and get the best deal. Nonetheless, it is imperative to do a self-examination and find out the amount of mortgage you can manage before you start the search. Why not learn more at Instant Loan?

Best 7 Ways to Have the Least Expensive Home Loan Interest Rate                          

In the course of the last three decades, prices of homes have increased way much past the national inflation rate IN US. Yet home buying remains to be the biggest purchase in America. As already outlined, home buying is an issue that should never be perceived lightly.  It is among the largest financial obligations and requires you to carefully examine the available options to avoid incurring more costs than what is really necessary.

The control of home ownership starts with the mortgage and the associated costs. The lower the mortgage rate, the less the amount you will have to pay in the course of loan life. With this in mind, let us review at least seven strategies you can use to have the least expensive home loan.

•    Keep a good credit score. Maintaining a credit score high to the extent possible is the foundation upon which a lower mortgage rate can be built. Generally, mortgage companies use your credit score as the basis of your creditworthiness. A lower rate means a lot of risks and lenders will use that as the basis for charging a higher mortgage rate or even fail to lend you completely.  On the other hand, a high score will alleviate doubt with regard to your ability to repay. Here is how FICO compute credit score:

a)    35% is based on your payment history. Therefore, ensuring you make payments on time is an act of kindness to yourself.

b)    Your credit utilization determines 30%. For this reason, ensure you retain a utilization rate of below 20%.

c)    The length of credit history determines 15%. Do not close accounts that have good standings even if you’ve had them for so long.

d)    New credit accounts will account for 10%. So then, open new accounts where it is sensible to do that.

e)    The final 10% is accounted for by credit mix. The ability to manage different types of loans interests most of the lenders.

•    Ensure you have a lengthy and steady work history. Long work history also interests mortgage companies. Therefore, if you have been working at the very same place for years with a growing income, you are the right track. Lenders will be more willing to offer you a mortgage loan at a very attractive rate. It is thus important to avoid changing jobs if you want to have a good standing before lenders. Regular change of jobs put at risk your ability to qualify for a home loan.

•    Search for the best rate. One of the most important things to do to shop around for the best rate. With technology, you can easily compare rates from online institutions such as banks against local credit unions to get the lender that offers the best rate. It is an easy thing you need to try, though most people fear to put such efforts.

•    Ask the mortgage institution to offer you a better rate. While life often gives worth things such as ‘NO’, it is the worst thing you can expect in this regard. If you have a high credit score, you can consider your mortgage company to match competitor’s rat. Still, you can just ask for a lower rate courtesy of your outstanding credit history.

•    Examine the trade-off of adjustable-rate in contradiction of fixed-rate loan. This is yet another strategy a borrower can use to arrive at a lower rate. The former provides a teaser of up to seven years that is relatively lower compared to the average mortgage rate. Nevertheless, the rates are usually adjusted higher in order to match the prime rate. In case there is a huge change in interest rates between the stipulated duration, homebuyers can a crippling upsurge in their mortgage payment.

•    Try paying for points. Potential homeowners may choose to pay for points. These refer to upfront fees paid to for the purpose of lowering the mortgage rate. Each pint is equivalent to 1% of the worth of the entire loan and paying lessens the prevailing rate by 0.125%. But is there a preferred time to pay for the points? Definitely yes! The best time to opt for this approach is when you intend to live in the home for a longer period of time. Lessening the interest rate will save a substantial amount of money in the course of the loan duration.

•    Lastly, consider refinancing. This approach is worth it. The loan rates are closer to the historic lows, implying that opting to pay 100 basis points over the prevailing rates may gain from refinancing.


It is possible to have the least expensive home loan interest rate. There are cases where the smallest things can end up saving you money. This article has discussed seven strategies you can use to lower your home loan interest rate. Following all the aforesaid suggestions will help you in a significant way. We hope this has been helpful. 

Published by Lavismichel Inkel