As you begin to consider the perfect home to meet your needs, there’s likely one thing you need to understand. Obtaining the right mortgage is almost as important as finding the right home. That perfect mortgage necessarily means finding something that offers you a great rate as well as fantastic terms. Because interest rates can essentially dictate the cost of your home loan as the years go by, finding the best mortgage rates in Florida means substantial savings. What factors actually influence your mortgage rates, though, and what should you know about how to improve your chances of getting the best rates a lender has to offer? In this quick guide, we’ll help you learn more about securing the best mortgage rates possible whether you’re a soon-to-be first-time homeowner or you’re seeking Florida refinance rates that will help you have a more affordable home loan.

Securing the Best Mortgage Rates in Florida

There are actually a number of different ways to obtain the best mortgage rates in Florida if you’re shopping for a new home. One option is to approach the seller or home builder for help. You can ask for a rate buydown. They’re becoming more common all the time. The seller or builder agrees to a concession, which allows them to contribute part of their sale to the transaction itself. 

That money goes to the lender, and in return, the buyer gets a lower overall rate. It’s important to know that these rate changes aren’t always permanent. Instead, in some cases, it may just result in a temporary rate break for the buyer. For example, you could obtain a 2/1 buydown. That would mean a rate that is 2% lower in the first year, 1% lower in the second year, and it reverts back to the originally quoted rate and payment amount by the third year. 

You could also create your own rate by buying points. At any time, no matter what the overall interest rate is, you likely have several rates to choose from with a lender. If you want a lender to give you a lower rate, you can pay a fee called discount points. That allows a lender to drop the overall rate of your loan for the lifetime of the loan itself. 

To secure the best mortgage rates in Florida, you’ll need to consider a few strategies. This will require a bit more cash at the outset. For example, you may experience a percentage point drop of at least half a percent if you pay up to 1% of your loan amount. It may not seem like much, but that can be a huge decrease in your monthly payments. If you have additional savings, it may be worth it to go this route. Keep in mind, though, that this approach only works if you plan to stay in the house for some time. If you’ll only be there for a year or two, you may not experience the real benefits of buying points.

Working with more than one lender at the outset may help you secure the best mortgage rates as well. Every mortgage lender has various costs that go into making a loan. As a result, if you’re offered a particular rate from one lender, you may not be offered that same rate from another lender. 

Talking to multiple lenders before you choose the right one to meet your needs, then, is a good way to find the lowest possible rate. Shopping around may mean experiencing a difference of a few percentage points, which can prove really helpful. Be sure, though, to talk to a few different kinds of lenders. Consider a mix of online lenders, banks, and credit unions to understand the best possible deal that may be available to you. 

You could also see if a loan assumption is available. This, like buying points, could require quite a bit of cash on hand, but it may be worth it. Up until just a few years ago, mortgage rates were sitting at less than 5%. It may be possible to assume your seller’s mortgage. In this situation, you would buy the house, but instead of applying for a new mortgage, you pick up where the previous owner left off, paying it down as you go. 

You’ll need quite a bit of money to do it this way, as you’ll have to have the cash on hand to pay the seller’s total home equity (essentially the price of the sale minus their mortgage balance). It may also be important to understand that not every lender is willing to take on a mortgage assumption, but it could be worth it to check. 

It could also be valuable to consider a different kind of loan. There are many different kinds of loans available from adjustable-rate mortgages to government-backed loans. All of these have very different rates attached to them, and shopping around to look at different kinds of loans can be incredibly helpful when it comes to finding the right mortgage rates to meet your needs. 

If You’re Shopping for Florida Refinance Rates . . . 

While many of the tips don’t apply if you’re shopping for the best refinancing rates, many of them actually do. If you’re refinancing, you can still pay points on the new loan to help lower your rate. You can also shop around for a lender who is willing to offer you a lower rate. Additionally, you may want to consider a very different loan product to help lower your rate. 

There are a few other things you can do to get a great rate when you’re refinancing, too. Start by taking a closer look at your credit score. If it wasn’t quite what you wanted it to be when you initially obtained your loan, taking some steps to help increase it now may help you get a better rate when you refinance your home. Additionally, paying your closing costs out of pocket can help you lower that rate as well. 

 

The Right Rate For the Right House

If you’re in the process of home shopping, finding the right house and the right rate often go hand in hand. At Synergy Homes, we can’t wait to help you find the perfect home to meet your needs. Give us a call today to shop all of our home models or to learn more about our custom builds designed to meet your needs.

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