Best Refinance Home Mortgage Loan Rate

How Do I Get a Good Rate Quote from All My Competing Lenders?

There are four things you must absolutely do in order to compare apples to apples, or mortgage quote to mortgage quote.

1) Get your rate quotes on the same day, at the same time of the day.

If you don't do it at the same time, then at 9:00 in the morning you may get a rate quote from one lender and at 4:00 P.M. another quote from a different lender. If there's been a price increase during the day, then the 4:00 lender's rate may be higher than the rate you got in the morning. The fact is that both lenders' rates are higher if rates went up during the day. During the times of high market volatility, Some interest rates change as much as three times per day. Maybe more. That means that the interest rates quotes made in the morning are no longer any good.

Lenders price their loans on the very same index on competing loans. You won't find one lender at 6% and another at 7% on the same exact loan under the very same terms. Forget what the advertisements tell you, it just won't happen.

2) Get a rate quote on only one program.

There is no way to compare a 30-year fixed loan with a hybrid. Two different animals. You must determine beforehand, absolutely, the mortgage loan program you need and get quotes on the exact loan. Some loan officers can't compete on certain loan programs or one lender might have a promotion on a particular type of loan they'll try an steer you toward.

If you call a lender and ask for their rate on a 30-year fixed rate but that lender hasn't been very competitive in the market, they may try and suggest another product. They'll ask questions such as, "Tell me, how long do you intend to keep this mortgage?" or some other question to try and find an alternate product you might be interested in. For instance, you tell the loan officer you're only going to be in the house for three to four years and guess what, they'll say "I have a special loan program (a hybrid) that's fixed for three or four years at a much lower rate. Would you like me to quote you on that instead?"

When the interest rate on hybrids is much lower than a 30-year fixed, it's tempting to sign-up immediately and feel lucky at finding such a great deal. But your journey of finding the best rate just ended there because you changed the course of your search. If you get a low hybrid quote instead of a 30-year fixed rate, make absolutely certain you immediately contact the other lenders and get their quote for that same hybrid as well. You may find that when one lender is competitive at one program they're competitive on the others too.

3) Get a rate quote for a time frame long enough to cover your transactions.

Today's rate quote might be a steal but only last for a short period of time, say five days. If you can't get your loan approved and closed within five days then what good is the rate quote? Not good at all. That's a common trick some loan officers use when quoting interest rates. "My rate today is 3%, but that's only good for loans currently in our system ready to go to closing. If I had your loan in my closing department today I could offer you that rate, but alas, I don't."

Don't fall for it. In you head you're thinking, "Wow! This company has super low rates! I'd better get my loan in with them as soon as I can!" But really you're forgeting that lenders can't be that much better than everyone else because they set their pricing using the same index. If you do fall for the trick, you'll also find when you get ready to go to closing that the rates of that lender turn out to be just like everyone else's. And probably a little higher. Instead, get a rate quote that will cover your transaction. If you close within 30 days, then get rate quotes covering a 30-day period. If you need 45 days, get a 45-day quote.

4) Get a quote for all the lender fees associated with that rate.

A lower rate means little if it costs you more to get the rate. Some lenders and brokers offer lower rates but stack the transaction with closing fees. Who cares if the money comes from an originating fee or from a variety of junk fees? It still costs you the same. Getting a quote with associated fees i perhaps the most difficult part of comparingvarious offerings. It can get confusing, especially when you're comparing to no-point quotes and one-point quotes.