4.92% Mortgage Rates – How To Shop For Your Home Loan

Today the national average for a 30 year fixed mortgage rate is around 4.92% according to Bankrate’s national survey. In many cases the toughest thing about getting a new home loan is getting the lender to call you back. But once you do, here are the things you need to keep in mind when shopping for a mortgage – either for a new home or for a refinance.

Checklist for Shopping for a New Home Loan Mortgage

Shop around. This seems obvious, but on average most folks call only two lenders before committing to a loan. Each mortgage lender and bank has different pricing and fees and they are largely negotiable. Keep in mind that your “loan officer” or “mortgage banker” or whatever name they go by is a commissioned salesperson and only gets paid if you get a loan. Shop around, negotiate, and escalate to their manager to get the best deal.
Have your credit report and credit score in hand. If you call a lender the first thing they will want to do is to pull your credit. That’s fine, and multiple inquiries for the same kind of credit request in a 15 day period wont hurt your credit score. But you need to know what is in the report first so that you will be in the best negotiation posture – get your credit report for free here if you don’t already have it.
Get a written Good Faith Estimate. This is the great equalizer that will let you compare rates and fees. You do not have to put down a deposit before requesting one – if the lender pushes you for a credit card deposit before givng you a GFE then you need to hang up.
Understand what you are getting if you pay points. Points are pre-paid interest on your loan, and can reduce your interest rate and monthly payment. But not all points result in the same reduction in rate – make sure you get it in writing.
No Pre Payment Penalties. Never, ever accept a loan with a pre-payment penalty. Never. Nuff said.
Do Not Give a Deposit Unti You Are Ready to Commit. Many lenders will only start your quote when you commit to a “refundable” deposit. Be Wary. There are legitimate reasons the lender will want to have you pay for an appraisal in advance, but until you are ready to lock your rate I would highly encourage you to not give a credit card deposit.
Be Accessible. Mortgage lenders are swamped right now. I heard that Wells Fargo is demanding $900 deposits and quoting 60-90 day closings right now. Your “loan officer” sales person is not going to work hard to contact you if you are difficult to reach. Make sure you give them your work, cell, home numbers and email to reach you.

These rates wont be around forever, and they tend to rise quicker than they fall. Read on for more refinancing tips and the 7 top mortgage mistakes to avoid.