Saving On Your Overall Mortgage Cost
A mortgage with a high interest rate can end up costing almost twice the value of the property over thirty or forty years. While you’re building equity the whole while, there are ways to save. Also, it’s wise to get a mortgage paid off as swiftly as it’s feasibly, financially, safely possible to.
You don’t know how the value of the property will maintain over the long run. In some communities, property values double inside twenty years. In other communities, within a year or two, the bottom can drop out of a given neighborhood. This happens even in top-tier communities.
If you don’t believe that, just look at how the real estate markets in some of America’s most well-to-do communities have been impacted by the current COVID-19 crisis. Even in cities like NYC and San Francisco, the bottom has totally dropped out. So you need to be sure you invest wisely.
Even the best real estate markets can crash, and you want low interest so you can pay off mortgages quicker. Following are a few tips to consider as a means of helping you get the best possible rate on your property.
- A Credit Score That’s High Can Secure A Better Mortgage Rate
- Shop Around Among Financial Institutions–Do You Have Friends With Assets?
- Larger Down Payments And Single Family Homes Tend To Have Lower Interest
A Credit Score That’s High Can Secure A Better Mortgage Rate
On a positive note, if you can swing it, now is the time to buy a home for low interest rates–they’ve just dropped to 2.8%; a historic low. However, getting the lowest credit score requires having requisite credit. The higher your credit, the lower the overall interest rate you can expect. If credit is low, there are things you can do to expand it; but they take a little time.
If you’re in debt, get in the habit of making your payments on time. If you can, pay more than your minimum threshold every month. Taking out a loan and paying it off on time can also increase your credit–seeking the advice of a financial adviser is wise here, everyone’s personal situation differs.
Shop Around Among Financial Institutions–Do You Have Friends With Assets?
Don’t merely take the word of a single financial institution. Shop local if you can. You’ll have more negotiation potential among local banks and credit unions than national or international banks, who view you as a financial asset rather than a human being; despite how good customer service is or isn’t.
Also, if you’ve got friends or family who have assets, you can pay a downpayment and use them as a loan cosigner. This can help you get lower interest rates. If you’ve got well-off associates that share mutual trust with you, you can have them take on your debt, and just pay them instead of a bank. That’s not an option for most people, though.
Larger Down Payments And Single Family Homes Tend To Have Lower Interest
The higher the down payment you can come up with, the lower associated interest on a given property is likely to be. Single family homes tend to have lower interest rates than condominiums, also; so keep that in mind as you shop around.
The Lowest Possible Interest Rates
Good credit, shopping around, and making big down payments are some of your wisest moves for a low mortgage rate on a new property. Right now interest rates are at historic lows, so it’s a good time to buy; but do your research and shop around for best results.