|From Money Talk News Article|
This simple step is essential for getting you the best possible interest rate on your home loan.
We couldn't agree more, and we will work with you to get the best possible rate through our new association with Guaranteed Rate Inc.
This post comes from Marilyn Lewis at partner site Money Talks News.
Ready to apply for a home loan? Here's the one piece of advice that can save you 10s of thousands of dollars on your mortgage, plus six more tips to help you get the best mortgage deal you possibly can.
Before you apply for a mortgage, pull your credit history and get your credit score. Why? Cleaning up your credit history and raising your score can make you eligible for the best interest rates on a mortgage.
You'll want to do this as soon as possible -- giving yourself a year to improve your credit.
Borrowers with scores above 720 get the best mortgage rates. They are welcomed with open arms by lenders. If your score is below 720 you can still get a mortgage. But it's more difficult. And it'll cost you more.
The chart below shows you why. You can use your own numbers at MyFICO's Loan Savings Calculator.
In this chart, you'd pay $195 a month less with a 760 credit score than with a 639 credit score. That's a difference of nearly $70,000 over the total life of your mortgage.
Lower credit score? Pay more interest Credit score* APR** Monthly payment Total interest paid 760-850 4.018 $959 $144,848 700-759 4.242 $985 $154,244 680-699 4.421 $1,007 $161,845 660-679 4.636 $1,032 $171.08 640-659 5.07 $1,085 $190,072 620-639 5.62 $1,154 $214,781 *Source: MyFICO; **Annual percentage rate
Los Angeles, CA 90025