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Why Mortgage Refinance Rates Go Up and Down

How Credit Affects Mortgage Rates

If you’re shopping around for the lowest mortgage refinance rates you might wonder why there is so much difference from one lender to the next. Mortgage rates vary across different lenders at different times for a number of reasons that have nothing to do with you, and a few that do. Here’s an article from HSH.com that explains why mortgage refinance rates move the way they do:

Mortgage rates are influenced at several levels–from worldwide economic events, which you have no control over, to your credit rating, which you can control. Here are the factors–from large to small–that determine your refinance mortgage rate.

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If the mortgage refinance rates you’re being quoted are higher than what you’re seeing in the news or the once your neighbors are getting the culprit could be your credit score. Here’s a chart illustrating refinance rates at various credit scores:

How Credit Affects Mortgage Rates

As you can see the lower your credit score the more you’re going to pay for your mortgage refi.

Before you get too invested in refinancing your home it’s important to check your credit reports for mistakes. You don’t have to pay for credit reports as a recent law requires all three credit agencies to give you a free copy of your credit file every year. Visit the website annualcreditreport.com and you’ll be able to print out all three of your credit reports free of charge. Don’t worry about paying for your credit score either; your broker will give you the score during the application process.

There are other steps you can take to make sure your credit score isn’t holding you back from today’s best refinance rates. Opening new credit accounts for example before mortgage refinancing will lower your credit score. You can learn more about getting the lowest refinance rates without paying junk fees or unnecessary markup by checking out my free Underground Mortgage Videos.

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