Strategies to get a lower rate
Getting a low refinance rate is both an art and a science.
Specific strategies work, and some don’t. Every single situation is different, and the stakes are high.
Certainly, rates are hovering near 3-year lows, but that does not mean lenders will just give you their best possible deal and call it a day.
In some cases, you have to poke and device for your best rate.
So, how do you do that?
Together with the right knowledge, you can address your lender with confidence, knowing how to contrast one offer with another, and even use one offer against the other.
Ready to get the best mortgage refinance rates? Here’s how.
Make sure your credit and financial obligation are in check
To have the best rate from any lender, you should have a good credit score and a low debt-to-income ratio. In 2018, financing scores and DTIs were the two main reasons why lenders denied refinance applications.
Loan providers offer the best rates to consumers who have a track record of paying their bills on time and managing their debt.
So, you’ll need to make sure your financial house is in order by checking your credit report’s accuracy and calculating your DTI before you start shopping for the lowest refinance rates.
Keep in mind that a less than ideal credit score or excellent DTI doesn’t necessarily disqualify you from a mortgage refinance — but it means you won’t be able to get the best rates and maximize your savings.
Contrast multiple loan quotes
You can get as many mortgage refinance quotes as you need. But regrettably, many borrowers only get one quote or apply with one lender.
By asking for a quote from just one lender, you could be making thousands — if not tens of thousands of dollars — in savings behind.
Fortunately, the web makes it easy towards obtain quotes from several lenders.
But here’s the kicker: you can’t simply get multiple quotes. You must show the quotes to the other lenders.
Possibilities are that high quotes will come down. Loan companies will lower their rate and/or fees to keep your business. Smart shoppers come out on top when they use several quotes to their benefit.