Article provided by: Shannon Christenot

Mortgage rates became undeniably attractive in 2019, hence more people became keen on the fixed mortgage rate. The average fixed mortgage rate was 3.99%  at the end of May. This number was a significant drop from the 2018’s 4.56% rate. Is it worth it to go through the application process to reduce the mortgage rate?

You may want to consider the following money saving techniques to reduce the rate of an active mortgage. The first step is to understand the building blocks of mortgage rates in Los Angeles.

What determines the interest of a mortgage plan?

  • Credit score
  • Down payment fee
  • Mortgage amount
  • Mortgage term
  • The number of discount points you pay
  • Location of the home
  • Type of loan you borrow
  • Type of interest rate 

How to lower the mortgage rate

Keep a good credit score

The foundation of a low rate starts with your credit score. A high score alleviates worries of paying the loan, while a low score will only earn you a more significant financial burden. Here is how top credit score calculators establish the value:

  • 30% is about credit utilization; hence one should work to keep the cost below 20%
  • 15% is from your credit history; thus one should avoid closing long-standing inactive accounts
  • 10% is on new credit history, hence avoid opening a new account unless it makes financial sense
  • 10% is about the credit mix; thus lenders should be able to handle different types of loans using your credit score

Maintain a work history

Lenders may want to see a consistent work or money-generating history to trust your ability to honor the contract. Lenders are more likely to give you better mortgage rates in Los Angeles. The broker will advise you on whether the lender will be suspicious when you have consistent job changes with profound income fluctuations.   

Shop around

One of the smartest ways to remain accountable for your mortgage rate is to urge your mortgage broker to find you multiple mortgage packages. Shopping around is easier today than it was a couple of decades ago. It is easy to compare mortgage rates when you use the mortgage calculator tool to evaluate different values.

You may be able to find a stellar lender who can work with a low credit score after extensive searches by our staff. Additionally, shop around for different homes through the online home search tool.

Pay for discount points.

Prospective homeowners can choose to pay discount points that will lower the mortgage rate. Each point equals 1% and reduces the ongoing rate by 0.125%. It is prudent to pay for paints if you plan to stay in the home for an extended time. Consider the trade-off of the amount you will save if you plan to stay in the house for at least nine years.

Mortgage rates have a lot more regulation and minimal flexibility. Shannon Christenot talks about the tactics of comparing different loan estimates and purchasing the right services to favor your bargain. Use our online calculator portals to find a comfortable mortgage rate and talk to us for further assistance.

 

Mortgage Rates Los Angeles
Shannon Christenot
(818) 601-2231
700 Flower St #1000
Los Angeles CA 90017 US

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