Utah Mortgage Rate Shopping Tips

Shopping for a mortgage can be confusing and counterproductive if you don't know what you are doing. If you are shopping for a mortgage in Logan, Cache Valley, or Utah, there are a few tips that you should know to simplify the process and to help you truly find the best deal. In no particular order...

Tip #1: Do your shopping on the same day! Interest rates change every day and sometimes several times a day. If you can, do all of your shopping within a time period of a few hours.

Tip #2: Know your credit score beforehand.This is important so that each lender that you talk to doesn't have to run your credit score. In fact, do not let any loan officer run your credit score unless you have made a decision to go with them, as this can hurt your credit score. For a decent rate, with no "hits", most conventional lenders are requiring a score above 720. FHA lenders are requiring minimum credit scores between 620 and 640. You can obtain your credit scores through experian.com, transunion.com, and equifax.com

Tip #3: Shop for the same type of loan. Lenders have different interest rates for their FHA, Conventional, Rural Housing, and other loan products. Make sure that you know beforehand which loan is the best fit for you. Lenders may quote you rates and fees on other products but you should insist that you receive a quote on the loan option that you are shopping.

Tip #4: Insist that the loan officer quote you an interest rate with the same amount of points."points" and interest rates are interrelated. If points are higher, interest rates are lower and vice versa. Choose a certain # of points that you would like the loan officer to include in his/her estimate. Ask them for their "1 point mortgage rate" or their "0 point mortgage rate". Whatever you do, keep the points the same at each lender to give you an accurate comparison.

Tip #5: Shop for the same mortgage rate lock period. Interest rates will change for the length of the lock period. The shorter the lock, the better the rate. Unfortunately, some loan officers might quote you a 15 day lock period to lure you in, knowing that it might take more than that to process the loan. I would recommend you insist on a quote based on either a 30 day or 45 day lock period. Keep the lock period the same with each lender you shop.

Tip #6: Do not complete an application until you have received a good faith estimate. Most loan officers are willing to give you a good faith estimate before you complete a loan application with them. If they are not willing something may be sketchy. You should be able to know what the rate and fees will be before you undress financially for anybody.

Tip #7: Ask the loan officer if you can lock your interest rate today. Your interest rate should be able to be locked on the same day that you complete the loan application. It only takes 15 to 30 minutes to get the automated approval, at which point the loan officer should be able to lock. Make sure that you know whether the rate you were quoted is locked or "floating".