Mortgage Rate Determinants That You Can Influence Even At The Last Minute

Finance & Money Blog

Of the many factors that determine mortgage rates, there are some you can tinker with even at the last minute while others need time to be modified. Here are some of the factors that you can still modify even at the last minute:

The Size of the Loan

An average-sized loan attracts lower rates than extra small or extra large loans. The extra small loans attract higher rates because the lenders want to maximize their earnings from such loans. The extra large loans attract higher rates because they present higher risks to the lenders. Fortunately, this is something you may be able to change even at the last minute; you can increase or decrease your loan amount at any time, as long as the value of the property is accurately represented. 

The Down Payment

Making a large down payment decreases your lender's risk exposure while making a small down payment increases your lenders risk exposure. This is why a large down payment and small down payment will attract small and high mortgage rates, respectively. As long as you have the funds, you can increase the down payment, as long as you haven't processed the mortgage.

The Lender

Most people don't know this, but there are slight variations between different lenders as far as mortgage rates are concerned. Therefore, don't stick with a lender just because they come highly recommended by your work colleagues. Maybe the lender afforded your colleague's low rates due to their unique circumstances – circumstances that don't apply to you at all.

The Loan Term and Type of Rate

The features of your particular loan, which you can also change during the negotiations, also determine your mortgage rates. Such features include the mortgage term and the type of interest rates (think variable or fixed). For example, long-term loans usually fetch lower rates compared to their short-term counterparts. Again, this is something you have control over and can easily change at any time.

Your Negotiation Skills

In most cases, the mortgage rate first quoted by the lender is not the rate the borrower ends up paying. Mortgage rates are typically negotiable, and how low you can go will depend not only on your financial situation but also on your negotiation skills. Brush up on your negotiation skills if you are planning to apply for a mortgage.

Ideally, you should research the factors that determine mortgage rates early enough so that you can work them to your advantage. All isn't lost, however, if you didn't do a thorough research and you need a mortgage now; you may still be able to land great rates if you shop carefully and deal with the right lender.


26 January 2018

Raising Money for Adoption

Adoption is a beautiful thing. Raising a child someone else had is a completely unselfish act of love. Do you want to adopt a newborn in the near future but are afraid you won’t have the necessary funds to do so? Consider meeting with an experienced financial adviser. This professional can sit down with you and recommend viable fundraising options. For instance, you might want to take out a loan. Or you may wish to sign up for a grant. Obtaining a tax credit is also an alternative. On this blog, I hope you will discover effective tips to help you raise money for an upcoming adoption.