Tips to Land yourself the Best Home Loan Rate

by : Alan Lim

Today the world of home refinancing is highly volatile. While one day it may reach alarming proportions, and the next day the home loan rate may just be extremely low. Bargaining power always helps as does shopping around. Below are some tips to get you the best possible deal!

Shop around for the best deal

There are plenty of financial institutions that are more than willing to get your business. Furthermore, the home mortgage market is so competitive these days that getting hold of a lucrative deal is very easy. You just need to compare the home loan rate between multiple lenders before finally deciding which lender to settle on. Most lenders will provide a wide variety of rates and offer a lot of different schemes with flexible terms and conditions. Therefore, make sure to contact these lenders, check their company out on the internet and ask for a no obligatory free quote. Try getting as many quotes from as many lenders as possible in order to make an informed decision.

Comparison on the rate of the loan

Usually the home loan rate varies from one lender to the next depending on whether it is fixed or adjustable rate. You also need to take into account the possible risks associated with going for an adjustable rate of interest. In addition, also do some research and find out on the associated fees and costs for the mortgage. Try and compare rates between lenders based on the same loan amount, term and type. This will help you compare on equal footing and thus make a good decision.

Bargaining and negotiating for the loan

Once you have made a decision on the lender you wish to go for, you need to try to extract the best possible deal out of the process. Try negotiating and bargaining with the lender as much as is possible. Usually most of the loan officers as well as the brokers have sufficient leeway in offering you a good discount on the home loan rate. This can work to your advantage. If you ask them for a good discount, you might just get it! Lenders are always eager to get more business from you and hence a little bit of bargaining can stand in good stead.

What is all the associated cost

You need to also ask your lender to jot down every possible fee and cost associated with the home loan rate. This will enable you to plan out you finances and budget much better. Make sure to make a list of all the possible fees associated. Then during the bargaining process, make sure to ask your lender to waive off certain fees or at least reduce the amounts. Do not stop here. Try also negotiating on the terms and conditions. Many times your lender will be willing to ease up on the payment terms and agreement. For example, simple things like extension of the grace period, or reducing the interest rate etc. can all work to your advantage! You could even mention to your lender about the lucrative offers you had received from some other lenders. This will immediately prompt your lender to offer you a discounted rate. It's because they do not want to lose out on your business.