Is It Ok to Shop Lenders to Get the Best Interest Rate?
Often buyers wonder wheter it is disloyal to a lender or whether it will hurt their credit if they continue to shop interest rates by getting preapproved with more than one lender. To this I say, "To thine own self be true!" When you are comitting to buy a home you are making a 15 or more often, 30 year comittment to a lender, so the interest rates, and terms of the program have a huge affect on your family. Getting the best interest rate can save you potentially hundreds of thousands of dollars, so you have to do what's in your best interest and not worry about the loan officer and their potential loss of time in getting a second or third option. Is it Ok to shop lenders to get the best interest rate? Absolutely, I recommend it! Here are a few reasons why:
- If you apply for credit with several lenders and do so within a two week time period, most credit bureaus regard the credit pulls as one pull, which means that it doesn't affect your credit score as much as if you were shopping lenders for a two or three month period. The bureaus will understand that you are being a smart consumer, and will classify the credit pulls as one inquiry.
- Additionally, I would recommend that you check with banks as well as mortgage brokers, because sometimes their are a lot of different programs that mortgage brokers have that banks might not.
- Also, a credit union may be worth looking into, because they often offer their members lower interest rates!
- See if any of the lenders have a program that can do a rapid rescore of your credit if there is inaccurate information that might boost your score significantly if removed. This can make a big difference in your interest rate!
I hope these tips help you in answering the question of shopping lenders to get the best interest rate. Please do an amoratization schedule and see how much you are paying over the life of the loan. Compare 15 year mortgages to 30 year mortgages, which may offer you a lower interest rate making the payments almost the same, while paying off your mortgage in half the time!
If you need real estate assistance of any kind, the Rich Life Real Estate Team can refer you to the right professional on our team to help with any of your needs! Call 404-718-9126 and let's see how we can help!