How To Get The Best Mortgage Rate

December 9, 2016

Interest rates on 30-year conforming mortgages have increased 50 basis points since early November. The rate hike increases mortgage payments by 7 percent and adds $750 worth of interest to a median-price home every year.

Jonathan Smoke, the chief economist of, has a few tips on how to secure the best mortgage rate. He advises buyers to shop around, because mortgage rates vary from lender to lender. Buyers should also ask for discounts, pay for a discounted rate, and put more money down. Even hybrid loans, which combines aspects of fixed-rate loans with adjustable-rate loans, are an option.

Higher rates may even have a positive impact on potential buyers.

With higher rates, lenders are encouraged to take on more risk as they can make more money. Likewise, if they want to maintain their mortgage business, they have to more aggressively court the purchase market in order to replace the volumes they have been doing in the refinance market. That means potential borrowers should be seeing more love from lenders even with low down payments, lower credit scores, and higher debt-to-income ratios.

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