Being an intelligent person, you don’t want higher mortgage payments than necessary. So you shop around. But are you good a current mortgage rates shopping? And when are the current mortgage rates the best mortgage rates?

When you compare mortgages, there are certain things you need to be on the look out for. You’ve probably noticed that mortgage rates fluctuate from day to day, sometimes a lot. You’ve probably also noticed that on a given day some lenders’ ‘current mortgage rates’ sign have lower numbers than other lenders signs.

You’ve definitely noticed that next to the current mortgage rates advertised there’s another rate, the APR (Annual Percentage Rate). There are two APR’s: the nominal APR and the effective APR. It is the effective APR that interests you as it shows the real cost of your mortgage (assuming that all the costs are included when the calculations are made).

If you’ve paid attention, you’ve noticed that APR’s vary more than interest rates from lender to lender. That’s because what they give you is the effective APR’s. Better said, that’s because not all lenders calculate the APR the same way. There are two areas that cause the differences: pro-rated fees and the number of fees included.

As regards pro-rating: you can pro-rate anyway you want, you can use the exact day of the closing, or you can use any other day. As regards the fees that are included: there are some fees everyone is supposed to include; then there are fees that some include and some do not. And lastly there are the dishonest mortgage brokers and mortgage lenders, the ones who do under report the fees or omit some of them.

You don’t want the mortgage with the lowest interest rate, you want the mortgage with lowest APR (assuming it included the same fees, pro-rated the same way).

Lucky for you, you don’t have to assume. You go to the first lender/mortgage broker and ask for a Good Faith Estimate and a guarantee in writing that all is included. (There could still be variations, but they would be smaller. The variations would be due to such things as a third party raising its fees not to your lender/broker adding fees they did not disclose).

Then you go to several other mortgage lender or mortgage brokers and you ask them to quote you an APR that includes the very same items and give you a guarantee in writing. Now you’re comparing apples to apples.

While you’re busy sifting for the best mortgage rates from the myriad of current mortgage rates, don’t forget that you need a good credit history to qualify for prime rates; that a larger down payments mean lower mortgage rates and lower APR’s; the a steady source of income is required too.

And above all, don’t forget to breathe in, breathe out and smile: the current mortgage rates will yield the best mortgage rates if you do your due diligence whether it’s the first mortgage loan you ever take out, a remortgage or a refinance.

Author Bio: Learn how to get the best current mortgage rates or remortgage you deserve, the kind that doesn’t make you pay more than you have to. A good mortgage broker can overlook things. Your best strategy is to know things yourself.

Category: Finances
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