The hunt has begun! You’re looking for a new house loan, a refinance, or a consolidation, and you’re dead set on getting the best available rate! So where better to conduct your study than on the internet late at night, with your coffee in hand and your family fast asleep?
We’d want to assist you in your quest, so here are three free suggestions that we believe can expedite your progress and lead to success:
- Benchmarks
- Comparisons
- Apples and Oranges
1. Benchmarks
You must begin somewhere. What does it mean to be “low”? Let’s not lick our index fingers and stick them in the wind to see which way the storm is going to go. If you want the best rate, you must understand what the market is doing now, where it has been historically, and what it may do in the near and long term (say over the next 3 to 6 months.)
- a) Thankfully, there are a plethora of tools available on the internet to help you conduct simple market research. Some websites offer a Rate-Watch that is updated throughout the day and includes graphs, charts, and specifications for fixed rates, ARMS, Jumbo’s, and everything in between. Simply use your preferred search engine to uncover a slew of websites eager to provide you with free market data like a successful person’s perspective.
- b) I recommend that you concentrate on the 30-year fixed-rate and look for a graph that shows the TREND over the previous 6 to 12 months. People say a picture is worth a thousand words. Also, look at the current fixed rate, as well as the APR for an adjustable-rate mortgage, and potentially consult two or three different internet resources. Most of them should be very similar. This will boost your faith in your own improving your understanding of what’s going on in the world.
- c) Many real estate sites offer a free Financial News watch that is updated throughout the day and includes mortgages, car loans, and breaking business news. Of course, the news is plentiful on the internet, and we aren’t the only free provider of this information. Start a day with a good morning affirmation. Go wherever you like, but read at least a few articles, even if only the first few words. What’s up with the interest rates? What are the Feds up to these days? Are there any commentators out there discussing how things are looking and what may happen with interest rates?
If you spend 5 minutes doing this, you’ll be as well-informed on rates as the best of them. In today’s world of mortgages and loans, you’ll know what “low” implies with a high degree of surety.
So set aside 20 minutes and set some goals for yourself. Then, and only then, will you be able to determine what the best rate is and be completely prepared to continue with your critical shopping excursion.
2. Comparisons
Every loan is unique. Every lender is different. Every borrower has his or her own set of conditions that are unique to them. There are also hundreds upon thousands upon thousands of lenders. The knowledge is available, but you must concentrate on efficiency.
- a) Using one of the many internet firms that supply this technology to you is the best method to sift through the deluge of thousands of lenders, with rates changing daily and terms that may or may not be displayed for everyone to see (for free).
- b) I’m not going to mention my own favorites, grow your common sense, make suggestions, or point out which ones are the oldest, newest, or quickest. This post isn’t about that, and I believe in your capacity to make wise decisions. I will state that I am a firm believer in their services.
- c) By offering a very basic, brief, and accurate way on a short-form application, you will be made available with 3 to 4 loan offers that match your needs and circumstances almost instantly, from the thousands of lenders, rates, and offers that are collated and structured in the databases of these different loan search providers. I award you an A for efficiency, as it allows you to put your hard-earned time and resources to better use.
- d) After receiving these loan offers, the next step is to compare them. When you compare them to the competition, you’ll notice a significant difference. Compare and contrast them. Compare and contrast them to various types of lending institutions. Compare and contrast their terminology. Compare the positions of the two. Compare and contrast their pasts. Compare their rates, points, Origination Fees, and anything else in between, of course.
3. Apples and Oranges
Given the topic of this essay, this may be a counterproductive question, but are you certain that RATE is all you’re interested in? Is having the LOWEST rate actually the most crucial factor to consider when taking on a major financial commitment like a new loan?
- a) It’s sometimes pleasant to conduct business with your neighborhood bank. They’re practical across the street, they know your name, and you could even get a Christmas card and, on rare occasions, a chocolate box. They may charge a little higher rate or provide less favorable conditions, but they’ll typically tell you upfront, and what they’re selling isn’t so much the bottom line as the security of knowing who they are and what sort of personal connection you can expect over the next 30 years.
- b) It’s wonderful to use your local credit union from time to time. Perhaps you work for the government, the energy company, or your employer is a member of a local, non-profit credit union. Credit union members are committed and almost fanatical in their preference for using the credit union for all of their financial requirements. It’s a lovely notion that you own a portion of the bank and, in a sense, you’re borrowing from yourself. So, the credit union may be able to provide you cheap rates, but more significantly, if you’re looking for an alternative to private lending institutions, this is always a smart option.
- c) It’s okay to borrow from the Big Mammas on occasion. There’s nothing quite like the ease of use. Also, if you want to do everything from your local grocery shop, this is something you should check into. It isn’t just about the rate. Convenience is important. Look, if you live in a fast-paced California lifestyle, the convenience of conducting business may be more significant in your decision-making process.
Take away
The point I’m trying to make is that while the pace isn’t everything, it does play an important role. So, although I’m not advising you to avoid getting the best deal possible, I am advising you to do your study and weigh all of your alternatives before making a final selection.
I wish you all the best in your endeavors. Stay motivated and always seek out sound counsel from those you can trust, and never disregard your own common sense.
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