Below you'll find four tips for getting one of today's lowest mortgage rates possible, like these:

More: Compare current mortgage rates in your area.

1. Look your best as a borrower

A man in a suit with a clock on his arm straightens his tie
Alex Gukalov / Shutterstock
Spiff up your credit before you borrow.

You'll score a low rate if you can convince a lender that you're a low risk.

So, check your credit score for free and take steps to raise it, such as paying down your debts to give yourself a lower debt-to-income ratio.

A mortgage company wants to know it will be repaid, and a credit score below 700 often won't cut it. If you can make the lender feel comfortable with you as a borrower, you will get a sweeter deal.

2. Look your best as an earner

Close-up Of A Smiling Woman Showing Company Cheque
Andrey_Popov / Shutterstock
You'll look better to a lender if you're an employee, not an entrepreneur.

It's best not to apply for a mortgage until you've had the same employer for two years or more.

Know that lenders favor borrowers who are employed by businesses, versus people who are self-employed and who freelance. A lender might even require you to have a co-signer on your loan if you're working for yourself.

If you work for yourself but your spouse works for a company, you might get a much better mortgage rate if the loan is taken out only in your spouse's name.

3. Put more money down

BRIBE: Businessman counts and puts down a heap money on a table / Shutterstock
Low-down-payment options are available, but they won't get you the best rate.

Sure, there are mortgages that require just a small down payment or even no down payment at all, especially when you're a first-time homebuyer.

But If you put down at least 20% of the cost of the home, you can generally land a lower interest rate.

Not only that, but you also can evade pesky private mortgage insurance, which lenders tend to require from borrowers who make smaller down payments.

4. Weigh your options

Young couple in love resting on the couch next to the window, surfing the web on a laptop computer and drinking coffee. Lens flare effect on the window
Impact Photography / Shutterstock
Comparison-shop and look at other loan types if you want to be sure you're getting the lowest possible rate.

Shop, shop, shop around and compare rates. Don't just grab a loan from the very first company you talk to.

Be aware that interest rates vary across loan types. Adjustable-rate mortgages have lower rates than fixed-rate loans, and shorter-term mortgages beat 30-year loans. (But loans with shorter terms also have higher monthly payments.)

In some cases, government-insured loans, such as FHA mortgages, will offer better rates than conventional loans.

Your mortgage interest rate is a choice that could be with you for years. Make a wise decision for maximum savings over that time.

About the Author

Doug Whiteman

Doug Whiteman


Doug Whiteman is the editor-in-chief of MoneyWise. He has been quoted by The Wall Street Journal, USA Today and and has been interviewed on Fox Business, CBS Radio and the syndicated TV show "First Business."

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