A great majority of potential home buyers look for the lowest and most flexible mortgage rates to fulfill their dream of home ownership. There are various factors that may contribute towards decreasing the mortgage interest rate that you may be liable for. Most of these factors involve your status as a low risk borrower, because this provides the financial institution assurance that you have lower chances of defaulting on the mortgage.

Furthermore, it is also vital to compare the services of different lenders to be certain that you are getting the best deal.

Maintaining a Low Risk Profile: All banking and lending institutions are primarily concerned with reducing their risk on every single mortgage that they approve. They offer high interest rates to people who have high risk profiles, whereas they attract low risk borrowers with reduced interest rates.

Maintaining a Good Credit History: Before offering you mortgage terms, all lending institutions evaluate your detailed credit history to asses if you qualify for a mortgage or not. They do so to analyze your credit reimbursement and lending patterns. In case you have significant amounts of previous debts or default credit payments, you are not likely to get lower mortgage rates. If you’re pressed for time then there’s not much you can do to improve your credit history, but you should attempt to reduce your payable debts prior to applying for a mortgage. You will be in a better position to qualify for lower interest rates on your mortgage if you do not have outstanding debts.

 Maintaining a Steady Employment History: Chances are that you can easily get a mortgage which requires lower interest if your employment history portrays you as a stable and well-established individual. Make sure that you are presently not employed on temporary basis. In addition, if your debt is much lower than your income, you are a sound borrower who can easily enjoy low mortgage rates.

Higher Home Deposit and Equity: Homeowners can get lower mortgage rates if they are able to pay a higher down payment or possess considerable home equity. Both these factors make a significant contribution in projecting the low risk profile of a prospective home buyer. You can get the lowest mortgage rate if you can make more than a 20% down payment. If you are not able to do so, not only will your mortgage rates increase, but you also end up paying for mortgage insurance.

Compare Different Offers: Different lenders employ varied mechanisms to evaluate risk profile of a potential home buyer. Consequently, it is rather sensible to look for information from different lenders and vigilantly compare the offered mortgage products. While considering that the first offer is not necessarily the best one, you should utilize your negotiating skills to make it in your own favour.