5 Ways to Get a Lower Mortgage Interest Rate
Everyone wants the lowest rate. When shopping for a mortgage, there's no item higher on the list of "to asks" than "what's the rate?". The problem is, no one knows what the lowest rate is - not your mama, nor your papa, not your mortgage banker, and not your Realtor. The only time we know when a rate's hit it's low is when they've already moved a bit higher.
While you can't control whether you get the lowest rate offered historically, you have large control over getting the best possible rate available at the time you're ready to buy or refinance. There are several things you can do to lower the rates you'll be offered when the time comes to turn in your mortgage application.
1) Fix (Or maximize) your credit scores in advance
Even people with really good scores usually still have some room for improvement, and the rate differences can be substantial between a borrower with a 700 FICO score and someone with a 750 score. Sometimes, simple updates or corrections can make a big difference to a 
score, and something like paying down a credit card balance can boost a score 25-35 points almost overnight.
Other items can take a while for the credit bureaus to clear up, so it's best to start looking into maximizing your credit score a couple months before beginning the loan process begins.
2) Put more money down
When it comes to conventional loans, rates are determined quite simply - on a sliding scale of credit scores and the amount of equity (down payment) in a home. The lower the FICO and down payment, the higher the rate. And likewise, a high FICO score coupled with a large down payment results in the best offers and lowest rates. Lower credit scores can be somewhat offset by large down payments when it comes to seeking the best interest rates.
This is less important for FHA loans, but for conventional loans, the amount of down payment or equity in a home (when refinancing) can make a huge difference when it comes to interest rates.
3) Look into different programs
If you're working with a good lender, they should be doing this for you, but make sure your lender is giving you options. For example, if you're seeking a jumbo loan in a "high cost" area (deemed so by Fannie Mae), you may have an option to take a jumbo loan OR take a conventional loan and a 2nd mortgage. Often times the conventional loan offers a better rate, and if the 2nd mortgage has attractive terms, this can make a lot of sense.
The 1st and 2nd mortgage option is also becoming more popular with cash out refinance transactions - rate adjustments for cash out can be pretty large, so sometimes it makes more sense to do a rate/term refinance, and use a 2nd mortgage for the "cash out" portion of the loan. A strategy like this offers the best in rate and still gets you the cash out you want.
You may be eligible for different loan programs that all have rate variances, too - VA loans for eligible Veterans have great terms, but a VA buyer could also be eligible for FHA loans, conventional loans, and Jumbo loans. Knowing the options, and the plusses and minuses of each will allow you to get not only the best rate, but the best program for your unique financial goals.
4) Shop Around
Shopping around isn't as easy as just going online and searching "5 Ways to Get a Lower Mortgage Interest Rate". There are very important things to consider. For one, if you're purchasing a home, the lender with the best advertised rate might not be the most reputable lender out there. You do not (I repeat. Do. Not.) want to put the purchase of your home in the hands of a lender that you can't trust will get it closed and closed on time. It's best to shop amongst reputable lenders and referrals from friends and family that have gone through the process before.
Rates are at least somewhat determined by what the loan officer working on your file gets paid - we get a percentage of loan amounts, and we can negotiate that %. Some loan officers want more, and some want less. The ones who want more pass along the cost through consumer rates, which is another reason rates seem to vary so much from company to company
You can read more tips on how to shop for a mortgage here
5) Consider Different Loan Terms
Everyone seems to know about the 30 year fixed rate mortgage. But did you know a 20 year fixed rate has a lower rate, and a 15 year fixed even lower? The payments are higher, but if you can afford them, the interest savings can be substantial.
Unsure of whether you'll be in a home very long, or know you'll be selling within a certain period of time? An ARM loan may be a great option to get you a lower interest rate.
There are some exotic loan products still out there, so this again is the time to remind you to work with a professional you can trust that will guide you through the process and all of the available options.
Interest rates aren't just in the hands of your lender. As a borrower, you can take steps to find the lowest mortgage rates, and it doesn't always take a lot of work; just some smart shopping, and the help of a good professional.
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