How To Get A Cheap Mortgage

By: Ciele Edward

Break Studios Contributing Writer

Need to know how to get a cheap mortgage? A cheap mortgage is the goal of many a potential homebuyer. Unfortunately, to get a cheap mortgage you may need to demonstrate a bit of financial savvy. Taking the time to try, however, is imperative. A cheap mortgage leaves you with cheaper monthly mortgage payments, something every homeowner would love to have.

Pick a reasonably priced house. No matter how low your interest rate is or how long of a repayment period you agree to, if you decide to purchase a $500,000 home, the odds of a low mortgage payment are against you. Just because your bank approved you for a high-priced home, that doesn’t mean that you can’t opt for a cheaper one in order to secure a cheap mortgage.
Work on your credit. Your credit scores play a strong role in determining your interest rate and whether or not you qualify for a mortgage loan at all. You can pull one free credit report from each credit bureau annually to review the information for errors. Should you find errors, you can dispute them with the credit bureaus to ensure that your credit reports reflect the most up to date and accurate information possible. Good credit leaves you with a lower interest rate, which can help you get a cheap mortgage.
Shop around. Some lenders will offer you a better deal than others. Always request estimates and quotes from different lenders when mortgage shopping. In order to get a cheap mortgage, you must be able to identify the lender most likely to give it to you.
Look for lenders that offer extended repayment plans. Although the standard mortgage requires you to adhere to a 30-year repayment plan, some mortgage lenders offer 40 and even 50-year repayment plans. If your goal for a cheap mortgage is cheaper mortgage payments, an extended repayment plan can provide you with just that.
Dispute junk fees. Almost all lenders will attempt to sneak junk fees into your good faith estimate. Junk fees are fees that are negotiable, so negotiate them! Don’t let a lender charge you $500 just to print out your loan paperwork. Expect to haggle over fees in order to get the cheap mortgage loan you seek.
Pay a higher down payment. By paying more down on the home, you can finance a lower amount. The less you finance, the less you’ll pay over time in interest charges and the cheaper your mortgage will be.