Finding the lowest mortgage interest rate
How do you know if you've found a good deal on a mortgage? Smart buyers compare loan rates, points and lock-in periods. But with lenders changing their deals on a daily basis, it can be a challenge to get every offer on the same page.
Follow these three tips when shopping for the lowest mortgage interest rate:
- Get all your mortgage quotes on the same day. Rates can change daily -- call lenders or check online to get accurate, updated information. The rates quoted in print, radio or TV ads may no longer be up to date by the time consumers decide to put in an application.
- Compare apples to apples (or points to points). Figure out how many points are included in different mortgage offers. A point is a fee equal to 1 percent of the loan amount. Make sure when you get a mortgage rate quote from one lender, you compare the number of points in quotes from other lenders.
- Know when to get locked-in. When you lock in a rate, the lender is committed to offer that interest rate regardless of subsequent market changes. Lock-in rate periods are usually between 30 and 90 days. A longer rate lock costs more money in the form of points than shorter lock-in periods. Get the details of each lender's lock-in when making your comparisons.