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Will I Get The Best Mortgage With The Lowest Interest Rate?

By Ann White

What are the terms do you need?

Most people only think of the interest rate when they are trying to decide on the best deal they can get. That means a lot of people want to know : Will I get the best mortgage with the lowest rate? The short answer to the question is no, you won’t. The reason that you cannot assume that the lowest rate is the best mortgage is because there are so many different mortgage products to choose from. The first thing anyone who is looking for a mortgage needs to determine is whether they need a fixed loan or not. If you need a fixed loan then the length or term of the loan will have a direct effect on your rate in most cases. The shorter the term of the loan, the lower the rate will be. So you will usually get the lowest rate on a 15 year fixed mortgage.

ARMs

More than half of the market is looking for a fixed loan, but there are other types of mortgages that offer even lower rates. Adjustable rate mortgages or ARMs will generally offer much lower rates, but they only offer a fixed interest rate for a limited amount of time. Once the fixed period of interest has expired an ARM will adjust upward or downward with the market. As interest rates rise so will your ARM but the reverse is true as well.

Lower isn’t always better

If you are looking for the lowest interest rate and the lowest monthly payment then you may be looking for an interest only mortgage. While these loans offer the lowest interest rate and the lowest monthly payment, none of the payments go toward paying the principle down, so they are not the best loan for the average borrower. So if you are still wondering : Will I get the best mortgage with the lowest interest rate? The answer, in general is no.

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3. What Is The Fastest Way To Find The Lowest Mortgage Rate?
4. Is Getting The Lowest Interest Rate Always Good?
5. How Can I Lock The Lowest Mortgage Rate In Today’s Tough Market?