We don’t need to present a survey result to prove that most people like to have their own house one day. But unfortunately, the cost of owning a Los Angeles Real Estate property is out of reach of most homebuyers. The average cost of a regular house is more than $280,000. For many, saving for this amount can be very hard.
The good thing is there is another way to buy a house without paying the full price of the house one-time. Getting approved for a mortgage is the best way to own a house in “installment basis”.
However, keep in mind that a mortgage is huge financial responsibility. The repayment can take up to 30 years, which is almost half the average lifespan of many Americans. Because of this, the responsibility for paying a loan can also be very difficult. To make it a little bit easier, here are some ways to get the best mortgage rate:
1. Improve Your Credit Score
Your credit score is the most important determining factor as to what interest will your mortgage be tied-up with. For instance, if you have a credit score of 760 and up, a 30-year mortgage contract would pay $164,000 in total interest which is about $33,000 less than what someone would get if he has a mediocre credit rating.
2. Good Employment Record
If you have a plan to buy a Los Angeles Luxury Property, you need to stay with your current employer for at least two years. Changing companies very often is not good for your credit-worthiness. Also, make sure that you have some copies of your payslip just in case the lender will ask for it.
3. Put Big Cash Down Payment
You will receive a lower loan interest if you will put more in down payment. Generally, lenders require their borrowers to put 20% of the total value of the house as down payment. If you put more, the interest rate on your loan will be smaller. If you put less, the interest rate will be higher.
4. Go Short
The shorter your loan repayment scheme is, the more savings you can get. If you will take the longer route, say the 30-year fixed rate mortgage, you will find out that you could have saved more if you choose the shorter mode of repayment.
5. Shop Around
Don’t settle for the first lender that will knock on your door. Apply for a mortgage to 3-4 different lenders. Once approved, compare and contrast the offers. Choose the company which offers the lowest interest rate and has a solid lending background.
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