Whether you’re looking to buy your first home or refinance your current mortgage, understanding your finances gives you an advantage when approaching a mortgage broker in Boca Raton. Your mortgage rate is calculated based on a variety of factors including income, payment history, down payment, and credit score.
Having a credit score of 800 has more buying power than $100,000 cash. While a perfect credit score isn’t necessary for a home loan in Coral Springs, it is one of the main factors mortgage brokers consider when determining if you qualify. The better your credit score, the more likely you are to get a low rate on your home loan.
One study conducted by Realtor.com’s chief economist found that raising your credit score by as little as 25 points can positively impact your Coral Springs mortgage. However, if your credit score is over 700, the benefits may be less noticeable. If your score is already fairly high, other factors like your income and the type of home loan you get may be more likely to decrease your rate.
What is The Ideal Credit Score for a Low Mortgage Rate?
If your credit score is below 625, your odds of being approved for a home loan are fairly slim. Even if you are approved, your mortgage rate may be too high to be affordable. Work on improving and maintaining your credit score before applying for a mortgage in Coral Springs. Maintaining a low credit card balance and making regular, on-time payments can raise your credit score fairly quickly. Getting negative items removed from your credit report will also improve your score.
Home loan seekers with credit scores between 625 and 700 had an average interest rate between 3.75 and 3.9 percent, however higher interest rates exceeded 4.5 percent. People with “excellent” credit scores- above 700- received an average rate of 3.62 percent.
Other Factors Coral Springs Mortgage Brokers Look for
If your credit score is as high as you think it will go, improving other factors can reduce your mortgage rate. Approaching a mortgage broker with a sizeable down payment may result in a lower interest rate. Your annual income and payment history for things like credit cards and auto financing can also be used to prove financial responsibility and lower your interest rates. If you already have a Coral Springs home mortgage with an established history of regular, on-time payments, you may be able to negotiate a lower interest rate on your home loan.
At Ace Mortgage Loans, we work with you to find the best interest rate available. Our knowledgeable mortgage brokers in Coral Springs offer various home loan options including FHA, conventional loans, private equity, and home loans for veterans. If you’re not sure about what options are available to you, we will gladly walk you through the entire process. Trust and transparency are at the heart of everything we do so you can rest assured you are getting the best home loan rate possible. Contact us today to begin your home ownership journey!