Hey Isaac,

When it comes to house loans, even a fourth of a percentage point can result in savings worth thousands of dollars. Therefore, getting the best refinance rates is important. Here are tips to ensure you get the best rates when refinancing your mortgage.

1. Look out for errors in your credit report

Credit report errors are more frequent than you could imagine. If you take time to review your credit report, you may notice these errors and request correction. Small changes on the rating will result in huge monthly savings.

2. Improve your credit score

Usually, a credit score of 740 and above attracts good interest rates on traditional loans. Although most lenders require a minimum score of 620 to 640, borrowers with low scores have to pay higher interest rates. Therefore, start working on improving your credit rating when you decide to get a house loan.

3. Lower your debt

Your credit score will be the major determinant of how much interest you pay when refinancing. One of the fastest ways of boosting your score is to pay off balances on your credit. This will lower the ratio of balance to credit, which is known as the credit utilization ratio. When the ratio is low, you are likely to pay less in interest accrued.

4. Consult many lenders

Start by determining your desired loan time and then research loan products from different lenders. Some lenders have portfolio loans, the ones they keep in their house rather than selling to the secondary market. They are often more flexible and have special promotions.

5. Find out if you qualify for a government refinance loan

If you have a FHA loan, you might qualify for FHA refinance loan. Such options attract lower interest than other loans. Talk to your lender or financial institution to know the options at your disposal.

Mika
Account Manager
​educationdivers.com​



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