The 5 Most Frequently Asked Questions About Mortgage Rates
By: Nicole Gates
What’s your rate? The first questions asked by most borrowers, whether purchasing or a refinancing a home loan, is asking the lender what their rate is. That’s because a borrower’s main concern is getting the lowest rate to save money. By choosing the lender with the lowest rate means you’re getting the best deal possible – isn’t it? Here are five of the most common mortgage rate questions and reasons why you may not wan to bother asking it:
1. What’s Your Rate?
This question is tricky to answer because there isn’t just one rate for all borrowers. The rate offered to you depends on many factors, which is why most lenders will provide you with a range, rather than one specific rate.
2. Can You Give a Lower Rate Than the Other Guy?
This is the repeated question most borrowers ask when shopping around for lenders. And most borrowers think this question is a good way to pick the best lender – but it’s not. This is a mythical question since rates can change week-to-week, day-to-day and even hour-to-hour.
3. Can I Get the Lowest Rate Among My Friends?
With rates being at historic lows, many people are bragging to neighbors and friends about the low rates they got. This leads to some borrowers wanting the lowest rate simply for bragging rights, rather than actually obtaining the best mortgage deal. They think that by having the lowest rate among their friends, they beat the market.
4. May I Float Down the Rate?
Some lenders allow you to “float down” a rate to lock it, in other words, giving you a second chance to lock if the rates fall. However, this option can be expensive, diminishing your overall savings even if you get a lower rate. In addition, when floating, rates may actually rise and you could end up having a higher rate than before!
5. Can You Tell Me More About The Loan Terms?
Once all the questions about mortgage rates have been answered, then borrowers ask about the loan, making sure they know what the deal is.
To learn more about mortgage rates and the right questions to ask when finding a mortgage company, check out this free eBook “Demystifying the Mortgage Process” which explains how to obtain a great mortgage deal in 6 steps.
What’s the first question you would have when seeking a mortgage? Would it be about rates?