Lenders use quite a few factors when they determine mortgage quotes for the borrowers. For many borrowers getting the best quote would mean the lowest rate. You must be aware of the factors that lenders think as important, when they prepare a mortgage quote for you.

• The type of mortgage: In an adjustable rate mortgage initially for a period of 3 – 5 years, you may get quite low interest rates. However, once this period gets over, your mortgage rates may be subject to the market fluctuations and may vary with the highs and lows of the market. An advantage of this may be that when the market rates go down, interest for ARM also goes down. On the other hand interests on fixed rate mortgages remain constant.

• The term of the loan: Whether you choose a loan term for 15 years or 30 years, will determine the mortgage quotes you get. A 15 years mortgage would mean that the borrower has to pay larger monthly payments while mortgage for 30 years would mean lower monthly payments.

• Down payment: The less risk you pose for the lender the more he might trust you. This factor will lower the interest on your loan. The greater the equity on your home, the lesser the chance of your defaulting on the loan. If you can make at least 20% down payment you may have a very good chance of paying the lowest interest rates.

• Your credit score: If you have good credit score i.e. above 680, you may qualify for good rates. If you want to apply for mortgage quotes, you must take care that you have a qualifying credit score.

• Type of property: Before a lender can offer you mortgage quotes, he will consider what type of home you are buying – whether it is a single family residence or multi family residence, a mobile home or a condominium.

You may seek online mortgage quotes or simply go visit companies in person and seek quotes. The place you are buying the property in, the city or the state you live in, the neighborhood, all of these factors will also be considered while determining your mortgage rates. If you have a good credit score and make a fair amount as down payment, you may be fortunate to get lower quotes compared to others.

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