"What's your interest rate?"
This is probably the most asked question when people start shopping for mortgages — but it shouldn't be. Rather than present you with misleading information and unrealistic numbers, we're here to tell you the truth.
Long story short: mortgage companies who advertise super low rates are throwing out arbitrary numbers to get people in the door.
If you're dealing with reputable lenders, interest rates should never vary from one another too greatly. Serious rate variations usually indicate shady business practices and should be treated with caution.
It's also important to know that if a lender quotes you an interest rate without having verified and documented information, such as a credit scores, income, assets, and property specifics, many unwelcome changes can occur during the loan process.
Work with a lender you trust.
"What's your interest rate?" should never be the most important question you ask when determining who you're going to work with, simply because rates should not vary much from lender to lender.
As a consumer, it's impossible to know all the right questions to ask. But what is possible is choosing to work with a lender who knows the right questions to ask you, and who has your best interest in mind.
In the most important investment you'll make in a lifetime, selecting the right team to have in your corner is crucial.
How are mortgage rates calculated?
Don’t compare your best friend's interest rate to the rate you are offered. Mortgage interest rates vary based on a number of factors, and no two people have the same rates. Rates change daily and sometimes intraday; Lender A may have the lowest rate on Monday, on Tuesday they may offer the highest.
Key factors affecting mortgage rates:
- Mortgage-specific credit score (Not the credit score you see on your credit card statements)
- Property type (e.g., condo, multi-family home)
- Occupancy type (e.g., primary residence, investment property)
- Total loan amount
- Total down payment amount
- Loan type (e.g., FHA, VA, renovation, reverse mortgage)
- Amortization type & term (i.e., fixed or adjustable rate; 10 or 20-year)
- Geographic location
- Appraised value of home
A number of factors determine interest rates. We can help you figure out yours – no catch.
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