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Homeowners with excellent credit ratings have an advantage when it comes to refinancing their mortgage loans; however, many do not take advantage of their credit by negotiating for more favorable terms and interest rates. Here are several tips to help you leverage your good credit to qualify for a better mortgage loan.

If you have a credit score of 650 or greater you are considered to have excellent credit. You’ve worked hard to maintain your credit rating; how can you be sure you are taking full advantage of it when applying for a mortgage? Having good credit does not guarantee you the best interest rate, you still have to shop around for the most competitive mortgage offer.

When you shop for a mortgage it is important to compare all aspects of the loan, not just the interest rates. The Internet is an excellent tool for comparing loan offers; you can quickly compare rates and fees from dozens of lenders online. When you compare loan offers use the Good Faith Estimate to compare all of the fees associated with each loan offer. Mortgage lenders are required to provide the Good Faith Estimate upon receipt of your application; however, most will give you this document if you ask.

Don’t be afraid to negotiate with a lender for better interest rates, terms, and fees. Your credit score is your bargaining chip; if a lender is unwilling to compromise on their fees and terms, simply find a lender that will. Ask for special treatment from your mortgage lender. The mortgage industry is extremely competitive and lenders will bend over backwards for your business. Have a detailed discussion with the lender about the closing costs and which fees the lender will remove or match from another lender.

Leveraging your credit score can save you thousands of dollars when negotiating for a mortgage. You can learn more about your mortgage options, including common mistakes to avoid by registering for a free mortgage guidebook.

// posted by Allston @ 2:21 AM 0 comments