The published rates are supposed to cover the same home owned by a person with an acceptable credit rating.  Here are four rates that showed up as a result of one search for home mortgage rates:  5.566% from Flagstar Direct, 5.602% from Quicken Loan, 5.435% from Midwest Mortgage Capital, and Empire Bank at 5.171%.  You can see that the range was less than 0.006% difference.  Throw in bad credit or a bad area residence, and the range between loans could radically change or may not be available at all.  Shorten the length of loan from a 30-year fixed rate to a 15-year fixed rate loan and the percentage will drop drastically and the range may narrow. 

Many banks and financial outfits are willing to make mortgage loans to people with solid credit histories and a universal on time payment showing.  Paying bills on time and never allowing a bad debt is a credit history that most creditors would die for if it was there.  If the home in question is in a "good neighborhood and in great condition," the loan people are likely to get a very good report from an appraiser.  Put the same house in a poor neighborhood and the value will drop and maybe substantially. 

Mortgage rates have been fairly low for some time now because of the financial distress that the country now is recovering from.  As this situation has been getting better, the rates so far have been staying low, but the loans were very hard to get.  

Why Apply At More Than One Place

A person trying to get a new home loan would be smart to apply at more than one place for several reasons.  The first place may decline the loan while another may make the loan.  A second and equally important reason is that the cost of getting the loan can be substantially different between lenders.  If both lenders are willing to make the loan, then it comes down to the terms and the cost of getting the loan as deciding factors on which loan to take.  There is no reason not to let the lenders compete for your business, and there is no reason to pay more than is needed to get the loan. 

Get Your Own Appraisal

Some buyers of property get their own appraisal, just to make sure that the lender’s appraisal is in the ballpark.  There is no law against doing this, and the two appraisals should be very close to the same number, or something is terribly wrong with one of the appraisals.  Remember that the appraiser is hired by the lender and not by you, even though you may be required to pay for the appraisal.  Never hurts to check out any numbers given to you by a lender or any other professional that does not have your vested interest at heart. 

If You Own The Property

If you own the property already, then you can get private lenders to look at making you a loan.  Private lenders that make private loans may be more willing to negotiate a loan than a lending institution.  There may be far lower cost in obtaining the loan, and the interest rate is open to discussion between you and the private lender.  Private lenders can be found in all cities that have a reasonable amount of real estate business.  It is amazing what can be found in the real estate business by a person willing to do some investigation.  There are no absolutes in this business, as all deals are subject to negotiation.  Remember this, and make the lender earn the deal they are offering to you.  Negotiating a deal is partly about not being too easy to come to the terms of the lender.  Remember you own the property, and you will only deal on what you consider a fair and equitable deal.  If you have a figure in mind, stick with your idea as long as you can, and you may get closer to that figure at the time of signing.

Do You Really Want The Property Or The Loan?

Sometimes a deal starts out and then gains a life of its own and the potential owner is just going along, but is not passionate about pulling off the property deal and the loan that is needed to make it fly.  Ask yourself if this is something you really want to make happen or can you walk past it.  Do You Need the deal?  If the answer is not a resounding yes, maybe you should back off and study the deal some more.  Is the loan going to put a squeeze on your finances, and will you be able to live with it over time?  These are questions that need answers. 

Conclusions

Mortgages and loans on property are part of owning a piece of land, a building, or a home.  There are many ways to get a loan, from a lender, from a private party, or from the previous owner.  If the property is fully paid for and you are getting money out of the property, that should put you in the driver’s seat, as the loan can be structured in many ways to meet your requirements.  Be sure to try several ways to get the money and not necessarily go with the first offer you get.  Be patient and do not tip your hand by showing any emotion when the offer is made; maybe a better offer will come in a day or so.  Patience in any business deal is the best way to get what you are after.  When the deal reaches a point of being a fair deal, then quietly accept the offer.  Patience will win out more times than not.  Negotiating is not about being stubborn, but it is about being persistent in what you believe is a fair arrangement.