The lowest mortgage rate rarely comes from the first lender you call. It comes from comparing offers. In short, get written quotes from at least three mortgage loan originators on the same day, for the same loan, and compare them line by line. This guide explains how to do that, why a well-known name is not a reason to skip the comparison, and what else lowers your rate.
How to Get the Lowest Mortgage Rate in 5 Steps
- Get at least three quotes. Ask three or more loan originators for an official Loan Estimate.
- Compare the same loan. Use the same loan amount, term, down payment and lock period with each lender.
- Look past the rate. Compare points, lender fees and the APR, not just the interest rate.
- Shop within a short window. Credit checks for a mortgage within a short period usually count as one inquiry.
- Ask each lender to beat the others. A written competing offer is your best negotiating tool.
Why Shopping Gets You the Lowest Mortgage Rate
Lenders price the same borrower differently. Research from Freddie Mac estimated that one additional rate quote saves borrowers about $1,500 over the life of a loan, on average. Getting five quotes saved about $3,000. A later Freddie Mac study found that rate differences between lenders more than doubled in 2022.
Yet many buyers still apply with only one lender. As a result, they often leave money on the table without knowing it.
Get at Least 3 Quotes From Mortgage Loan Originators
A quote is only useful if you can compare it. So ask each loan originator for a Loan Estimate, the standard three-page form every lender must use. The Consumer Financial Protection Bureau’s Loan Estimate explainer shows what each section means.
When you compare offers, check these items:
- Interest rate and points: A lower rate with expensive points may cost more overall.
- Origination charges: Section A lists what the lender itself charges.
- APR: This blends the rate and many costs into one number.
- Lock period: A longer lock can carry a higher price.
Also, request all quotes on the same day. Rates move daily, so quotes from different days are not a fair comparison.
Big Names Do Not Always Mean the Lowest Mortgage Rate
Large retail lenders are household names for a reason. For example, CrossCountry Mortgage and Fairway Independent Mortgage rank among the biggest retail mortgage lenders in the country, according to Scotsman Guide’s retail lender rankings. Size brings brand recognition, large sales teams and big marketing budgets.
However, size alone does not tell you who will offer the best price on your loan. A retail lender quotes its own pricing. By contrast, a mortgage broker compares pricing from many wholesale lenders at once. Neither is automatically cheaper. That is exactly why you should compare written offers instead of choosing by name.
If Your Agent Recommends a Lender, Still Get More Quotes
Real estate agents often recommend lenders they have worked with before. That recommendation may be a good one. Still, if your agent recommends a big mortgage company such as CrossCountry Mortgage, get a second, third and fourth opinion before you commit.
Keep these facts in mind:
- You can choose any lender you want. Your agent’s suggestion is not a requirement.
- Some real estate brokerages own a stake in a mortgage company. In that case, federal rules require a written Affiliated Business Arrangement disclosure explaining the relationship.
- A strong pre-approval from any lender works just as well when you make an offer.
In other words, use the referral as one quote, not the only quote.
Other Ways to Lower Your Mortgage Rate
- Raise your credit score. Even a small jump can move you into a better pricing tier.
- Put more down. A lower loan-to-value ratio usually earns better pricing.
- Consider points. Paying points upfront can lower your rate if you keep the loan long enough.
- Pick the right loan type. FHA, VA, conventional and jumbo loans all price differently.
- Stay under the loan limit. See our guide to South Florida loan limits to avoid a jumbo loan when possible.
How Lakebridge Lending Helps You Compare
As a mortgage broker, we compare offers from multiple wholesale lenders for you. So one application can show you several options side by side. Bring us a Loan Estimate from any other lender. We will review it line by line and tell you honestly whether we can beat it. If we cannot, we will say so.
Call (754) 289-0196 or send us a message to get a quote you can compare.
Lowest Mortgage Rate FAQs
How many mortgage quotes should I get?
Get at least three. Freddie Mac’s research found that each additional quote tends to save money, and five quotes saved borrowers about $3,000 on average over the life of the loan.
Will shopping for a mortgage hurt my credit?
Usually very little. Credit scoring models generally treat multiple mortgage inquiries within a short window, often 14 to 45 days, as a single inquiry.
Is a mortgage broker cheaper than a big lender?
Not always. A broker can compare many wholesale lenders at once, while a retail lender quotes only its own pricing. The only way to know which is cheaper for you is to compare written Loan Estimates.
This article is for general information only. Rates, fees and eligibility vary by borrower, property and market conditions and change daily. Company names are used only to identify lenders and do not imply any comparison of their pricing.
