Mortgages: the best time to finance

If you’ve already decided to buy a home and can’t afford to wait for a change in the market, your loan rate will largely depend on the market. If you have time to decide when to enter the mortgage market, research mortgage rate forecasts for the coming year. If rates are expected to go up, you may want to apply quickly, if rates are going down, you can wait.

Of course, your credit score will be another relatively fixed variable in your search for the best rate; if it’s relatively low, you’ll pay a higher rate. So if you have time before you need to borrow, try repairing your credit through one of the more well-known repair companies. It usually takes a few months for them to make a difference, but the points they earn can save you significantly over the life of your loan.

It’s common sense to shop around for the best mortgage rate and terms and negotiate with mortgage lenders until you’re satisfied you’ve been quoted the best rate available. So you can go through any expedited process you want, you need to establish the best rate and terms before you get close to closing.

Mortgage companies can lock in your interest rate once you apply and are approved, but if rates change too often, they may not offer you the opportunity to lock in your rate.

As an appraiser and I understand how important your valuation is. If you have problems with the appraisal, the rest of the transaction may fall apart. Address valuation issues before worrying about loan commitments, if the property you want to finance doesn’t value as high as expected, you may be wasting your time.

If you get a commitment of any kind from a mortgage company be sure to get a copy of it, some mortgage companies have resorted to on-screen signature documents that disappear once you’ve signed them electronically. The document you need may disappear when the mortgage lender no longer wants to honor it at closing, it’s happened to me, so you better have a “silkscreen” copy before it disappears into the ozone.

Historically, the mortgage rate has ranged between 3.0% and 18.0% and right now, as of early 2018, the 30-year fixed mortgage rate is close to 4%. Therefore, we have current mortgage interest rates that are near the lower end of the range of mortgage interest rates and, if you wait, there is no guarantee that they will remain low indefinitely.

If you take the time to make sure the home you want to borrow is appraised close to your expectations, that you’re in the best credit position to borrow, that you’ve shopped for the best available rate/terms, and that you’ve considered time, you’ll get much more for your money.