20 Tricks to Lower Your Mortgage Rates


In today’s financial landscape, securing a mortgage is a significant step towards owning your dream home. However, the interest rates attached to mortgages can often feel daunting. But fear not! There are numerous strategies and tricks you can employ to lower your mortgage rates and save thousands of dollars in the long run. In this article, we’ll delve into 20 effective tricks that can help you secure a lower mortgage rate.


Understanding Mortgage Rates

What are Mortgage Rates?

Before diving into the tricks, let’s understand what mortgage rates are. Essentially, a mortgage rate is the interest rate charged by lenders on your home loan. This rate significantly impacts your monthly payments and the overall cost of your mortgage.

Factors Influencing Mortgage Rates

Several factors influence mortgage rates, including economic indicators, inflation, the Federal Reserve’s monetary policy, and your creditworthiness. Understanding these factors can empower you to take control of your mortgage rate.

Tricks to Lower Your Mortgage Rates

Now, let’s explore 20 actionable tricks to lower your mortgage rates:

1. Improve Your Credit Score

Your credit score plays a pivotal role in determining your mortgage rate. Aim to improve your credit score by paying bills on time, reducing debt, and disputing any inaccuracies on your credit report.

2. Shop Around for the Best Rates

Don’t settle for the first mortgage offer you receive. Shop around and compare rates from multiple lenders to ensure you’re getting the best deal possible.

3. Increase Your Down Payment

A larger down payment can lower your mortgage rate and reduce the overall amount you need to borrow. Aim to save up for a sizable down payment to secure a lower rate.

4. Consider a Shorter Loan Term

Opting for a shorter loan term, such as a 15-year mortgage instead of a 30-year mortgage, can often result in lower interest rates.

5. Pay Points

Paying points upfront can lower your mortgage rate. Each point typically costs 1% of the total loan amount but can lead to significant savings over the life of the loan.

6. Lock in Your Rate

Once you’ve found a favorable mortgage rate, consider locking it in to protect yourself from potential rate increases while your loan is being processed.

7. Improve Debt-to-Income Ratio

Lenders prefer borrowers with a low debt-to-income ratio. Paying off existing debts or increasing your income can help improve this ratio and secure a lower mortgage rate.

8. Consider Government Programs

Explore government-backed mortgage programs such as FHA loans or VA loans, which often offer competitive interest rates for eligible borrowers.

9. Get a Cosigner

Having a cosigner with a strong credit history can increase your chances of securing a lower mortgage rate, especially if your credit score is less than ideal.

10. Choose the Right Type of Mortgage

Different types of mortgages, such as fixed-rate mortgages or adjustable-rate mortgages, come with varying interest rates. Choose the type that best suits your financial situation and goals.

11. Pay Off Debts

Reducing your overall debt burden can improve your credit score and make you a more attractive borrower, potentially leading to lower mortgage rates.

12. Maintain Stable Employment

Lenders prefer borrowers with a stable employment history. Avoid changing jobs frequently leading up to your mortgage application to demonstrate stability and reliability.

13. Consider Biweekly Payments

Switching to biweekly mortgage payments can help you pay off your loan faster and save on interest costs over time.

14. Avoid PMI

If possible, avoid private mortgage insurance (PMI) by making a larger down payment or opting for lender-paid mortgage insurance (LPMI) option.

15. Refinance Your Mortgage

Keep an eye on market trends and consider refinancing your mortgage if interest rates drop significantly. Refinancing can help you secure a lower rate and potentially lower your monthly payments.

16. Maintain a Low Debt Utilization Ratio

Keep your credit card balances low and avoid maxing out your credit limits to maintain a low debt utilization ratio, which can positively impact your credit score and mortgage rate.

17. Increase Your Income

Boosting your income through side hustles or career advancement can strengthen your financial profile and improve your chances of securing a lower mortgage rate.

18. Negotiate with Lenders

Don’t be afraid to negotiate with lenders to secure a lower mortgage rate or better terms. Lenders may be willing to offer discounts or incentives to win your business.

19. Consider a Mortgage Broker

Working with a mortgage broker can help you navigate the complexities of the mortgage process and potentially access exclusive deals and rates from various lenders.

20. Stay Informed

Stay informed about changes in the mortgage market and be proactive in seeking out opportunities to lower your mortgage rate, even after you’ve secured your initial loan.


Lowering your mortgage rate is not an unattainable feat. By implementing these 20 tricks and staying proactive throughout the mortgage process, you can secure a lower rate and save thousands of dollars over the life of your loan. Remember, every percentage point shaved off your mortgage rate translates to significant savings in the long run.

FAQs (Frequently Asked Questions)

1. How much can improving my credit score impact my mortgage rate?

Improving your credit score can have a substantial impact on your mortgage rate. Even a slight increase in your credit score can result in lower interest rates, potentially saving you thousands of dollars over the life of your loan.

2. Is it worth paying points to lower my mortgage rate?

Paying points upfront can be worth it if you plan to stay in your home for an extended period. However, it’s essential to calculate the break-even point to determine if paying points align with your financial goals.

3. Are adjustable-rate mortgages (ARMs) a good option for securing lower rates?

While ARMs initially offer lower interest rates, they come with the risk of rates increasing over time. Consider your risk tolerance and financial situation before opting for an ARM.

4. Can refinancing lower my mortgage rate?

Yes, refinancing can lower your mortgage rate, especially if interest rates have decreased since you initially took out your loan. However, it’s crucial to weigh the costs and benefits of refinancing before proceeding.

5. How often should I review my mortgage rate to ensure I’m getting the best deal?

It’s advisable to review your mortgage rate annually and keep an eye on market trends. If interest rates drop significantly or your financial situation improves, consider exploring opportunities to refinance and secure a lower rate.