How to Get the Best Mortgage Rates Today

So you’re looking to buy or refinance a home in Kansas City? Awesome! You’re probably up to your ears in trying to figure out how to find the best mortgage rates today to purchase or refinance.

The median home price in the United States is around $374,900 and rising in Kansas City. While this is on the higher end of the scale for the city, this median US price will still get you a modest four-bedroom home.

It’s not likely that you’re able to buy your new home upfront, so you’ll have to take out a loan from a Kansas City Mortgage Lender. But how do you get the best mortgage rates today on your new abode?

Read on for some of our top tips and tricks for the best mortgage rates for first time buyers.

Getting the Best Mortgage Rates Today:

When you buy a house, you’re asked to make a down payment. This is usually around 20% of the price of the house in order to get a really good mortgage payment. So if you’re buying a home for $236,000, you can expect to make a down payment of around $50,000.

This is because lending companies consider you less of a risk the more money you pay down. You’re considered far less of a risk if you put down 20% as opposed to 10%.

If you want to keep your mortgage rates low, make an even bigger down payment. This will mean you have to take out less money than you originally planned, and won’t be slapped with a huge mortgage payment each month.

Putting down a payment of at least half will help you keep your mortgage rates down and allow you to pay off the principal payment, instead of the interest, much faster.

Mortgage rates in the state of Kansas | Mortgage rates in the state of Missouri

Keep Your Credit Score Up

Having a good credit score is the best way to keep your mortgage rates down. On average, borrowers with pristine credit scores pay far less in interest than borrowers with okay credit scores. Those who have bad credit scores are most likely to get receive higher mortgage rates.

If you want to improve your credit score, you should never miss a payment for a credit card or student loan. Even missing one payment can cause your score to go down and make it much more difficult to get a good rate going forward.

If you’re a first time buyer and looking for the best mortgage rates and planning to purchase a house in the next 10 years or so, but don’t have credit, now is a good time to start building it. Get a high-interest credit card or loan and charge items you can pay back immediately.

For example, if you purchase a computer for $1500, do so on the credit card, but make sure you have the money on hand. Pay it back immediately and you’ll already begin to improve or lay the foundations for your credit score.

You can improve your credit score with some of the same tips used to build credit. Over time, your score will improve, as will your interest rates.

Go for a Shorter-Term Fixed Loan

Shorter-term fixed loans often have better interest rates than longer term. This is because they are of less risk to the company giving out the loan. A shorter-term fixed loan that has a higher monthly payment is not as risky as a longer-term loan with a lower monthly payment.

While the longer term loan may give you a smaller month-to-month cost, you may also be paying a lot more in interest. Going for a shorter term but a higher priced plan will actually save you money in the long run.

Have a Steady Record of Employment in Kansas

Having a steady record of employment is often key to getting the best rate on your mortgage refinance. Those who work freelance or bounce from job to job may have more difficulty than those who have been working with one company for several years.

At least two years of steady employment at the same company is a good sign for lenders, and they will often consider this when assessing your mortgage rates.

If you don’t have at least two years of steady employment at the same location, you may still be able to purchase a home. However, your interest rates may be much higher. It may also be more difficult to get a loan at all.

Consider How Long You’ll Be Living in Your New Home

Did you just move to Kansas City for the short term or are you looking at setting down roots? This is something to consider when it comes to what kind of mortgage you’ll need.

For example, if you’re looking to live in a home for a short period of time, you may find the best mortgage rate refinance are those with a low-interest introductory period. With this loans, the mortgage rate is often adjustable, and the interest rate will go up after the first 5 to 7 years.

If you already know that you want to move after that period of time, go for a mortgage with a low-interest introductory rate. You’ll likely sell before the mortgage rate goes up. An Adjustable rate may be the best mortgage rates for first time buyers who expect to move-up in the short term.

If you want to live in Kansas City for the foreseeable future, you should go for a longer term loan. While a 15-year loan is preferable to a 30-year loan, you should still take a fixed rate mortgage if your move is permanent.

What Is Best for Me?

Work with your local Kansas City lender to find the best mortgage rates today for yourself and your new home. You’ll be well on your way to living happily ever after!

Have Questions? Contact Metropolitan Mortgage Corporation online or call 913.642.8300.