When you’re shopping for a new home, the current home buying interest rates will have a significant impact on your monthly mortgage payment. The factors that affect the ups and downs of home loan interest rates can be elusive to the average new home shopper. In addition to researching the current home buying interest rates yourself, you will be working with your lender to lock in the best possible home loan interest rate at the time of your home closing.
Even if you have a pre-approved mortgage loan you will still need to finalize your home loan funding before you go to closing on your new home. Many people think the home loan interest rates they are quoted when they are pre-approved will not change, but home mortgage interest rates change daily. That’s why current home buying interest rates are so important to know when you fund your final loan.
After the property has been appraised, all the documents have been given to your lender, and all contingencies have been met, it’s only then the final loan approval and funding takes place. The process to finalize your home mortgage loan can range from 21 to 60 days or more depending on your financial situation. What the current home buying interest rates are on the particular day your loan funds will determine your mortgage payment. (Also it’s important to remember that you will be charged what the current home loan interest rate is that you lock in from the day your lender wires the money to the escrow account and not from the date of your home closing.)
Working with a reputable mortgage lender who will guide you through the home funding process and help you plan your rate lock based on the current home buying interest rates is your best bet. If your lender is closing most loans in less than 45 days, you're probably safe with a 60-day lock. But if looks like your closing will take longer, you may need to get a 90 or even 120 days interest rate lock. Many lenders will guarantee home loan interest rates for 90 or 120 days for an extra fee, typically a quarter or half point (a point is 1% of the amount you're borrowing.)
Staying on top of current home loan interest rates and planning your rate lock means paying less interest rate for the life of your home loan and that’s a good investment in your future.
By submitting SmartQuote’s simple online form, you can connect with a reputable Mortgage Specialist who will get in touch with you to discuss your home loan mortgage options.