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What Determines Your Mortgage Rate

A mortgage rate plays an important role in a person's financial state. There are many factors involved in determining your mortgage rate. A lot of these factors are beyond your control.

Here are some of the factors involved in determining your mortgage rate:

a) Economy
b) Unemployment rate
c) Supply of money
d) Stock Market
e) Earnings reports
f) Treasury Securities

Mortgage rates rise and fall with yields on Treasury securities. Yields on ten and thirty year Treasury securities are generally used to set long-term mortgage rates.

You owe it to yourself to get the best deal if you are in the market for a mortgage, home equity loan, or refinance-have lenders fight for your business.

Two factors you can control that play a crucial part in determining your mortgage rate are your credit score and the term of the loan-how long you borrow the money. The shorter the term of the loan the lower the mortgage rate will be. The higher your credit score-FICO- the better credit risk you are and thus the lower your mortgage rate will be.

Before you go house hunting it is a good idea to start looking for a lender and pre-qualify for a loan and see if you have any credit problems that can be fixed.