When you decide to buy a home, one of the most important factors to consider is your interest rate. With poor credit, you can expect a higher interest rate, which can have a huge impact on your monthly payments. Ideally, you should understand some different ways to avoid higher rates on your mortgage.
Pay for a Lower Rate
A surefire option to reduce your interest rates is to pay for lower rates. If you have some extra money saved up, it might be worth it to pay for a lower rate, which can provide you with great savings on a monthly basis. For example, over the period of the loan, you could save thousands of dollars by paying for just a quarter of a percent off. When you buy the rate down, it is called paying "points."
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