Getting friendly terms on a mortgage here in Tempe is a critical step in realizing that slippery dream of owning a home. Smart homebuyers understand that keeping the interest rates low keeps the total cost of the house low.
See, the interest you pay doesn’t go towards offsetting the principal loan amount. Therefore, it is in your best interest to keep the amount small as possible when taking out a loan. To achieve this feat, you need to take a few proactive measures.
Understand the mortgage process
For people who don’t understand the mortgage process, getting a mortgage prequalification is nothing short of miraculous. In fact, some may consider it a privilege. Unfortunately, neither of these opinions is true and can only lead you to make mistakes.
Mortgage approval is a highly specific process that considers the state of your finances both past and current. The only way you get prequalified is if you meet the minimum threshold. The lender carries this background check to assess if you are creditworthy or pose a risk to their money.
If they like what they find, then you get the all-important nod. A good grounding on the factors influencing home loan approval is mandatory when making an application.
Make the cut
Before a lender can give you the prized low-interest mortgage, you must make the cut. It means that you need to have a clean financial history, have a perfect credit score, carry minimal debt, and put down a sizeable down payment.
Credit history gives insights into your financial habits including how well you repay your debts. The credit score is a three-digit figure that sums up your financial report that ranges from 300 to 850. A score of above 700 is a sure ticket to affordable mortgage rates.
It is in your best interest to keep the interest rates on your mortgage on the lower end of the scale. Doing so ensure you get to keep the total cost of the house low.