When shopping for a home loan it requires only a couple of telephone calls to discover interest rates are not created equally. Virtually every borrower who has shopped for a mortgage rate has asked for quotes only to get a different answer from every source.
Caution is urged when anyone quotes a rate without first taking an application and examining the applicant's credit history. Otherwise the rate being quoted is simply "a rate" and not "your rate". Interest rates vary based on credit score, down payment, type of property, location of property, terms of the loan, and use of the property.
The idea behind federally insured loans like those widely available and insured by the Federal Housing Association historically offered the same rate to all borrowers regardless of their credit history, income and assets. Recently that trend has changed and barring a continued reprieve even FHA insured loans will make use of Loan Level Pricing Adjustments where rate is affected by some or all of these factors.
Lilburn, Georgia real estate agent Lane Bailey (http://lanebailey.com) encourages his clients to check with a bank, a direct lender and a mortgage broker and to be very inquisitive when rates vary greatly. Agents like Lane tend to become interested in the mortgage process when a loan officer quotes a rate out of line with the norm. Lane's advice, as is the advice of others, is to shop and make sure you understand what it is for which you shop.
Obfuscating interest rates has long been a tactic of mortgage advertisers and they have done a great job over the years of training shoppers to pay attention to the rate and ignore other equally crucial aspects of obtaining a mortgage. While rate is an important component of the mortgage by no means is it the only aspect which should be shopped.
Qualifying for the best rates available requires the best credit, acceptable income and assets, and other ways of presenting the lowest risk to the banks.
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