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Welcome back to our blog. A lot of people have bought homes lately in Rochester, and buyers are taking advantage of historically low interest rates. In order to get the best interest rate from a mortgage company, you need to understand all the factors that go into determining the type of loan you qualify for. There are three basic pillars that determine your eligibility for a mortgage: your credit, your income, and your collateral.
I would say credit is the most important, because most banks have a tier system to determine your rate based on your score. If you have a credit score of 740 or higher, that's exactly what you need to get the best rate. Credit can be quite difficult to understand, but as long as you remember to keep your credit card balance down and always have some kind of credit (like an auto loan or mortgage).
As far as income is concerned, you need to have been in the same line of work for 2 years prior to getting pre-approved.
For collateral, your down payment minimum on a conventional loan is 5%. However, the more you put down now, the less you'll have to pay in interest down the road.
If you've got a good credit score, 2 years on the job, and are able to put 5% down on a home, you're going to get a great rate. If you have any questions for us, feel free to give us a call or send us an email. We look forward to hearing from you!
