While interest rates have remained at low levels, many analysts are predicting that mortgage rates will be heading upward. With this in mind smart homeowners are rushing to lock in the low rates. The following tips will help interested homebuyers in shopping for the best rate.
How to shop: If you simply call up and ask a lender for interest rates the lender can tell you almost anything. One lender might offer a floating rate, while the next would offer you a forty day rate. Instead, before you call up you need to know two things: how many points you want to pay and how long you want to lock in the rate. You also want to call all the lenders on the same day. This way you will get a common basis of comparison for the different quotes.
Getting a reliable quote: Beware of lenders who promise unreasonable low rates. This does not mean that lenders are unreliable; however there is an incentive for the lender to fudge the quote in order to gain your business (the bait). Then when you go in to fill out the paper work the lender will change the rate on you (the switch).
How to Really Shop for a Lender: The best way is to get a referral, then shop other lenders. Do it properly, telling the lenders how much you are willing to pay in points and how long you want to lock in the rate. Make all your calls on the same day. Tell the lender you have filled out an application and that you will fax it in, so the rate has to be something he can deliver.