Ditech : Shopping For Rates on a Mortgage Loan

Shopping around for the best possible deal on your mortgage loans is very important. A difference of just a few percentage points will translate into thousands, if not millions of dollars in the long run. So before you take out a mortgage loans, you should try to find the credit source that offers the best rate.

You should be aware of the different types of mortgage loan interest rates as well. Fixed rate mortgages have the same interest rate for the term of your mortgage. Most mortgage loans are of this variety.

Adjustable rate mortgages have interest rates that change periodically, based on either a contractual agreement or a change in an economic indicator, such as Treasury bill rates. Fixed rate mortgages are also called variable rate mortgages.

Graduated payment mortgages have rates that change depending on where you are on the mortgage loan’s timeframe. You have lower payments to make early in the mortgage, and higher payments in the later years.

Asking for a longer or shorter loan will affect mortgage loan interest rates as well. A mortgage with a shorter term, however, will save you money. The rule of thumb is, the longer the mortgage, the more money the mortgage company makes. So keep it short and sweet.