Understanding Advertised Mortgage Rates

By Toni Ryan, First Priority Financial

Ads for home loan offerings are everywhere. Online, on TV, driving down the street, or listening to the radio, mortgage loans are probably the most common advertisement.
Banks and mortgage companies promise that they will do whatever they can to offer homeowners the lowest mortgage payment. It is important to understand the rate market and that it is constantly changing   daily and often hourly.  When you see an ad from a bank or mortgage lender that offers a lower rate, or gives you one solid payment figure based on a certain loan amount, you should be skeptical. In fact, most banks and lenders usually offer rates to just bring you in the door, though you may never actually be offered the advertised rate.
A mortgage program and it's subsequent payment is so complex that it is difficult to actually advertise one fixed mortgage rate or payment specific to a borrower without thoroughly interviewing the borrower. There are too many factors that will influence a homeowner's interest rate. The advertisements are examples based upon the highest credit score, low loan amounts, the home, etc.  
So what do you do?  Do your homework.  Ask family friends and co-workers who they used when they last refinanced or purchased a home.  Make calls and interview the loan officer to see if they listen to your needs and have your best interest in mind.  Do not let your credit be pulled but instead ask for the rates based upon a 680 credit score and a 740 score, loan amount versus value of your home and whether you are wanting cash out from the equity of your home.  These factors will allow you to compare options equally. Also ask for the lowest rate program and the lowest fee program based upon the above factors. The lowest rate may not be in your best interest so it is important to know all the facts.  A little time now can save you a lot of money and frustration later.
Rates are still low and equity in existing homes is rising so the time to evaluate your current mortgage or purchase a home is still great.  Connect with a lending professional who can guide you through the choices, educate you on the rate market trends and listen to your needs.  Your mortgage loan is a critical component in your financial picture so partner with a professional you can trust.