Whether you are seeking a loan for your prospective new home or refinancing an existing property
, a fixed rate mortgage is probably the way you will want to go. Due to the current global economic slowdown, interest rates are about the lowest they may be again in our lifetimes and it would be a prudent decision to lock these historically low rates in for the life of the loan. That decision having been made, finding the cheapest fixed rate mortgage available is the next task on the to do list.
Money is tight everywhere, and saving whatever you can on your new mortgage or refinance should take top priority. The first step toward saving money on your loan is to get a copy of your credit report and know your credit score. Inaccurate entries in your credit report can cost you big money when it comes to what interest rate a bank will expect you to pay and if they are even going to be willing to loan you money at all. Dispute any mistakes on your credit report with the reporting agency immediately and follow up with them until the issue is resolved to your satisfaction. Knowing your credit score is high will give you extra bargaining power when negotiating the terms of your new mortgage. If your credit score is not so great, knowing exactly how low it is will be vital in determining whether you can put up a fight over a particular term or if you will have no choice but to hunker down and take whatever deal you can get.
The next step is to shop around online and see who is offering the most competitive interest rate at the moment. While is easy to compare rates side by side, there are additional factors that will also affect the final cost of your loan. Paying points, in particular, will usually result in a lower interest rate over the long term but will cost considerably more up front. Closing costs should also be thoroughly understood and weighed before making a final decision which financial institution to go with.