California Mortgage Rates

Written by Patty Yu
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Understanding California mortgage rates can be tricky, since they vary from lender to lender, as well as from loan to loan. When shopping for loans, California mortgage rates are a good guideline, but you should look at all the factors involved before choosing solely based on the rate. You must consider your mortgage profile and how that will affect your interest rates.

California Mortgage Rates--Factors Involved

True, there are many different factors that can increase or decrease given California mortgage rates. One factor known to all of us is the credit score--that mysterious number many started to influence unknowingly in college! Credit scoring provides lenders insight into an applicant's credit risk, showing payment history, current debt level, and length of credit history just to name a few.

The higher your score, the lower your risk, ranging from 350 to 950. Your previous payment performance, current debt, credit history length, types of credit available, and number of new credit inquiries are each weighed differently to establish the score. Paying your bills on time every month is essential in maintaining a good credit score, but paying them in full each time is even better.

Although having good credit is a well-known influence to mortgage rates, many other important circumstances also weigh heavily. The larger a loan and longer you take to pay it, the higher your rates. However, larger down payments, greater than 20%, should get much better rates. Higher income level, closing costs, and adjustable rates all decrease mortgage rates.

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