Buying a house is an exciting prospect, but sifting through bank mortgages to find a good mortgage rate can be a challenge in the current economic climate. There are many mortgage options available for today’s home buyer, so choosing the one that is right for the buyer is important to starting off the home ownership process on a good foot.

The first step towards securing a good mortgage rate is having a good credit score. Mortgage lenders use credit scores to gauge the dependability of their borrowers; a higher score generally indicates that the borrower pays back their debts on time, and is a good credit risk. Lenders will give the best mortgage rates to customers that reflect reliable, on-time payments on other loans. Lower credit scores generally translate into a higher interest rate or the lender requiring a larger amount of money up front, or in some cases both. The length of the loan also affects the interest rate, so each borrower has to decide how quickly they can afford to pay back their loan, since that impacts the interest rate.

Once the credit score is determined, shopping around to different lenders can uncover mortgage rates and extras that were previously unknown. If a borrower has an established relationship with a bank, they might get a better rate by using them for credit than if they went to a bank where they would be a new customer. Occasionally, a seller will have a relationship set up with a bank that allows for a “preferred lender” relationship, giving the borrower a lower interest rate for using them. Alternately, lenders may offer a lower interest rate if a borrower has a higher down payment than the base requirements, or will offer different interest rates for different down payment amounts.

The internet gives future homeowners the ability to search online and to compare rates; there are websites than can aid in the search for a good mortgage rate. Many banks have their current interest rates online, and will allow the borrower to complete the entire loan application process from the comfort of their home, instead of having to go into a brick and mortar location. These rates can be compared against each other, and at times a lower offer from one bank can entice another bank to lower their rates further.

Searching for a good mortgage rate can be a time consuming process, but getting the lowest interest rate possible can save thousands over the life of the home loan. Maintaining a good credit score, comparing lenders, and doing research both through internet searches and bargaining are all important to getting a good mortgage rate.