How to Get the Best & Low Mortgage Rates in Canada?
We all want to find the best and lowest rates for a mortgage. Here are some helpful tips to help get the lowest mortgage rate you possibly can.
- Credit score matters. It actually plays a big part in the mortgage rate you will qualify for. Paying down any debts will help improve a credit score, as well as paying bills on time and settling any collection issues.
- Opt for a short-term loan. Loans with a shorter term often have lower rates as they are less risky for lenders. You don’t have to go for a 30-year loan when you can choose a 15 or 20-year loan instead.
- Try to put forward a bigger down-payment. You will be less of a risk to a lender if you can put down a larger down-payment, leading to an offer of a lower rate.
- You can actually pay for discount points. For example, you can pay $2000 to have a percentage of points (0.5%) to lower the rate. If you pay for points to get a lower mortgage rate, make you are are in the house long enough to make the amount you spent come back in interest savings. You need to make sure you break even.
- Consider an adjustable-rate mortgage. This type of loan usually has lower rates. The rates can fluctuate, however, after a certain time period.
Four Simple Strategies To Help Get the Lowest Mortgage Rates
- Strengthen your mortgage application: Submit all your mortgage applications within the same period of 14 days. Credit scoring models often count multiple credit inquiries for a similar loan as one inquiry if done within 14 to 45 days of each other. This will not impact your credit score as much.
- Shop around for multiple lenders: Take interest rates, ratings, costumer service and complaints into consideration. Compare fees to see which is more affordable for you, and this includes getting a “good faith estimate” from each lender. This estimate breaks down fees, closing costs and other charged expenses. Apply to several sources, banks, mortgage companies and credit unions. You can save a lot of money by doing that. Ask the lender to match a lower rate offer
- Lock in the Rate: You can lock in a rate for a short time when you find one that satisfies you. These short-term, 30-day-locks are often free, with fees beginning for longer rate locks. By locking in a rate, you are guaranteed the rate for the set time period. During that time, you need to close on your house so the rate can be kept. If you need more time, you will need to get an extension. The extension will cost a fee.
If you have any questions, please contact us. Let us guide you on the journey to find the best mortgage for you.