How to Find the Best Home Mortgage Rates and the Best Lender

How to shop for home mortgage rates

Selecting a mortgage provider that offers the best home mortgage loan rate can offer you savings upfront and over the life of your loan. The following will help you negotiate the best home mortgage rates and potentially save thousands of dollars. The best home mortgage loan rate is always the lowest rate with the smoothest processing and closing available.

Consider not just the home mortgage loan rate but the lender

Before considering a lender’s home mortgage loan rate, you should ask the following questions:

• Are you a lender or a broker? A lender has full control of the processing of your loan application while a broker typically has relationships with multiple lenders from whom to search for rates and products from that will ultimately underwrite your loan.
• How are you paid?
• How long has your company been in business?
• Do you have prepayment penalties?
• When can I lock my loan and what type of lock options do you offer? You want a lender that will lock you on the spot, even before sending your application.
• Do you out-source Underwriting and processing or do you have in-house underwriters and processors?
• Do you provide a free Good Faith Estimate (GFT) on rate and costs prior to deciding to go with you? Do you guarantee the quoted closing costs?
• How long can I lock my rate for?. You want a minimum of a 30-45 day lock when gathering rates.

The lowest home mortgage rates don’t translate into the best lender

After speaking with multiple lenders, determine when you feel most comfortable with. One of the big mistakes people make is to define the best mortgage provider as the company offering the lowest home mortgage loan rate. This isn’t always the case. Shopping rates is easy but shopping service is a bit more difficult. Anyone can quote the lowest rate, but not everyone will truly give you the quoted rate. Here are some things to look for when considering service:

• Providing a pre-approval free of charge.
• The loan officer returns callsor e-mails promptly. Communications and commitments are recorded in writing.
• The mortgage company is upfront with all of their fees.
• They provide guarantees that promote good service (closing data guarantee, rate quote guarantee, etc.).

Getting the best home mortgage rates

Getting the best home mortgage loan rate is as easy as calling for rate quotes or going online. When calling for a specific rate quote from different mortgage providers, it’s important to ask for a rate quote disclosing the following terms:

• Your sales price and the loan amount you’re seeking
• When you’re closing
• The product you’re seeking (FHA, VA, Jumbo, Sub Prime, etc.)
• The occupancy of the property (Primary residence, vacation home, investment property)
• The term of the loan you’re looking for

The final steps in procuring the best home mortgage loan rate

Once you’ve contacted a variety of lenders, take the home mortgage loan rates and fees and compare. Determine which mortgage provider has given the best overall deal. Now take the list of mortgage providers and compare the considerations for the best service and who you felt most comfortable with.

If the best home mortgage loan rate was offered by the lender with the best service, you know that you’re getting everything you could expect from a future mortgage provider. Still, this doesn’t mean that you can’t save money. Ask the mortgage provider to waive some fees such as the appraisal, application, underwriting, and credit report fee. Most mortgage providers always have a little wiggle room on their rate and fees. It can’t hurt to ask.

If the lender provides the best service but not the best home mortgage rates, you may be able to get them to reduce their rate by letting them know that they aren’t offering the best home mortgage loan rate. You could mention that you’ve gotten a better home mortgage loan rate from a competitor to see if they are willing to move down to meet their competitor. However, if the lender is unwilling to budge on rates or costs, then you need to make a choice - is the service worth the extra cost?

A little knowledge can go a long way in negotiating the best home mortgage loan rate. Just understanding how the mortgage industry works and the questions to ask loan providers could help you secure the best home mortgage loan rate along with the best service.