When does shopping for the best mortgage interest rate help?
After you narrow the field to two or three candidates, rate shopping makes a bit more sense. The best rate in the world is useless if the loan doesn’t close in a timely manner. Low-balling, that is, quoting a lower than actual rate to get your business, is unfortunately a common practice in the mortgage industry. Don’t rely on a quoted rate unless the lender is willing to lock it in. Certain rates, unless instantly locked, change daily. If you get a 7% quote on the phone today, you just can’t “take it to the bank.” You may still be 30-60 days from actually closing the loan because of the required processing. Rate quotes are based on clean credit. Prime rates go to prime applicants. Finally, remember that a locked rate is not a mortgage commitment. It simply reserves an interest rate for a set period of time.
