So, you are shopping for a mortgage.  Do you want the insider’s secret about what makes up the interest rate and how to shop for them?  Watch the video for more details.

When you’re preparing to buy a home or refinance your current mortgage, one of the most pressing questions on your mind is likely: “What will my interest rate be?” As someone who has been in the mortgage business for decades, I’ve heard this question countless times. And the truth is, while I can’t predict interest rates with pinpoint accuracy (I’d be on a beach in the Bahamas if I could), I can certainly give you a well-informed insight into how they are determined.

### **Factors Influencing Your Interest Rate**

1. **Credit Score**: Your credit score is a reflection of your financial responsibility. Generally, higher scores equate to lower interest rates. Think of it as your financial GPA; the higher it is, the better the opportunities available to you.

2. **Down Payment**: The more you put down upfront, the less risk the lender takes on. Thus, a larger down payment can often secure a lower rate.

3. **Loan Type and Duration**: Whether you’re choosing a 15-year, 30-year, or some other type of loan can influence your rate. Typically, shorter-term loans have lower interest rates.

4. **The Economy**: Macro-economic factors, such as inflation, economic growth, and actions of central banks (like the Federal Reserve in the U.S.), play a huge role in determining interest rates.

5. **Property Type and Use**: A primary residence will have a lower rate compared to an investment property or a second home.  Condominiums have higher rates than single unit homes.  2-4 unit homes will have higher rates and down payment requirements.

6. **Loan Amount**: Sometimes, jumbo loans (those above a certain amount) might have different rates compared to conventional, FHA, USDA, or VA loans.

7. **Market Demand**: Like any market, the mortgage market is influenced by demand. High demand can push rates up.

8.  **Income Documentation Type##: The standard income documentation type is paystubs and w-2’s or tax returns for self-employed.  Any other type of income documentation such as bank statements, 1099’s, DSCR, or no income verification will always come with higher rates.

### **Why Use a Mortgage Broker Like Us?**

Now, you may wonder: “Why should I use a mortgage broker? Can’t I just go to my bank?” While banks are a valid option, there are advantages to working with a broker, especially if you want a competitive rate.

1. **Multiple Lending Options**: Unlike banks that provide offers from a single institution, brokers have access to multiple lenders. This allows us to shop around and find the best rates available.  The Richard Woodward Team Nexa Mortgage has 200+ of the nation’s top lenders all completing for our loans.  We shop for you and deliver several options to you, you select the one that works best for you.

2. **Negotiation Power**: We’ve built relationships over the years, which means we often have a bit more wiggle room when negotiating rates.  In fact, because we are the nation’s largest mortgage broker, we get special rate offer lower than our competition which we pass on to you.

3. **Personalized Service**: The mortgage process can be overwhelming. Having someone in your corner, like The Richard Woodward Mortgage Team, ensures you have a guiding hand throughout the process.  You are going to love our video rate options format that allows you to see the real cost associated with your mortgage rate so you can make an informed decision.

4. **Market Knowledge**: We’re in the trenches every day, keeping our fingers on the pulse of rate changes and market trends. This means we can advise you on the best times to act.

In the end, securing the best interest rate involves a mix of personal financial preparedness and understanding the broader market dynamics. And while there’s no one-size-fits-all answer to the question, partnering with a seasoned broker firm and loan officer like Richard Woodward can undoubtedly give you a competitive edge.

So, when you’re ready to dive into the mortgage waters, reach out. We’re here to guide you, answer your questions, and ensure you secure the best rate possible.

Warm regards,

Richard Woodward

Branch Manager, NMLS 217454

Your 5-Star Rated Mortgage Lender

Voice/Text:  (214) 945-1066

www.MortgageProsUs.com

Nexa Mortgage NMLS# 1660690

7820 Hague Ct Plano, TX 75025

 

Licensed by the Texas Department of Savings and Mortgage Lending (SML) Mortgage Banker Registration. Nexa Mortgage is an Equal Housing Lender. This is not an offer of credit or commitment to lend. Loans are subject to buyer and property qualifications. Rates and fees are subject to change without notice.

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Note: Always consult directly with a mortgage professional or financial advisor for personalized advice. This post is meant for informational purposes and might not reflect the current state of the market.