Mortgage Monday: Shopping for a Mortgage, Part One

Shopping for a mortgage may sound like going to a store and looking at merchandise. It is very similar, as all mortgage professionals call their loans “packages.” Selecting just the right mortgage package for you is a job that takes research and action on your part. After all, this will be connected with the largest and most important financial purchase you are likely to make in your life. A small difference in the mortgage rate can make a big difference in your monthly payments.

First, I highly recommend that you order a copy of your credit report from all three credit reporting agencies and check it for errors. It is estimated that 50% of all credit reports contain errors that can be significant enough for an individual to be denied a loan. An inaccuracy that you are not aware of  could cost you thousands of dollars in extra interest, or even worse, a denial of credit!

Secondly, tracking interest rates is recommended when shopping for a mortgage. What are the current rates? Are they going up or down? Mortgage rates fluctuate frequently, some times several times during a day. It is rare that they remain constant for any length of time. There are many factors that affect interest rates and it is difficult to predict accurately what the interest rates will be from day to day. Stay in touch with your loan officer to get the most up-to-date information concerning interest rates. An understanding of the key economic indicators can provide some information as to the future direction of interest rates.

Mortgage rates often rise and fall along with the yields on Treasury notes and bonds, and these government securities reflect the overall direction of interest rates. Watch the Treasury market and the mortgage market trends and you will have a better chance on obtaining an interest rate savings.

To Be Continued…..

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