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The best home loan rate can be obtained by an individual borrower who has shown extreme responsibility in relation to their use of credit, and who desire to purchase a house that has a value high enough to match the fund request. Credit score and the amount of money used as a down payment determine best home loan rates. The percentage is usually advertised with mortgage brokerages and lending institutions such as bank and credit unions. Unfortunately, most applicants will not qualify for the greatest percentage. If lucky, they will qualify for a fair rate.

Those individual borrowers that have exceptional credit and a 10%-20% down payment to put towards the purchase of a home should assume that the best home loan rate advertised would apply to them. However, some lenders advertise relative amounts that are specific, and a borrower may need a different type of fund depending on the purpose for the house purchase. There are 3 types of categories that offer the best home loan rates. They are fixed, adjustable, and federally backed funds. The best funds belong to the adjustable rate mortgages (ARM); however, this rate will not remain the same throughout the life of the funds borrowed.

ARM funds offer the best home loan rate (usually 2 percentage points lower than the fixed) for a limited period of time, 2, 3, 5, or 7 years. Then the best housing percentage will fluctuate according to the current housing market interest index. There are limits placed within each ARM that state just how far up or down the interest can settle at. Once the interest has settled, the loan transforms into a fixed rate loan, and the borrower must pay off the funds according to the terms, sell the property and pay it off, or refinance. Many times, a borrower will refinance with another ARM fund to ensure the lowest monthly payments possible. Be sure to hear the words of Proverbs 2:6 which states, " For the LORD giveth wisdom: out of his mouth cometh knowledge and understanding."

The best home loan rates within a fixed mortgage are gained by having excellent credit and a large down payment. Fixed percentages do not fluctuate at all throughout the life of the funds, (which is usually 30 years). The fixed rate loan is the best option for a borrower who plans on owning the property for a long time, and who purchases the house when the national housing market interest index is very low. The best percentages available within federal programs can be found in the FHA or VA funds. These are not direct loans, but guaranteed federally in the case of a borrower who defaults. The FHA loan is typically for first time homebuyers, while the VA fund is reserved for veterans and their spouses. Finding the best percentages on houses is no easy task, but thorough research and perseverance should result in success.

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