Best Mortgage Rates in Virginia

Financial preparation

Mortgage lenders take into account your assets and liabilities, including student loans, car loans, other debts, and income, when determining your eligibility for a mortgage. Your credit score is one of the biggest factors into the loan you’ll qualify for, so work to improve your credit as much as you can prior to applying for a mortgage. This may involve paying off debts, especially consumer debt accrued on credit cards.

Aim to save as much as you can towards a down payment for your home with additional savings for repairs, a home inspection, an appraisal, and closing costs the seller may negotiate to transfer to you. Many lenders require as little as three percent down for a conventional loan down payment, but any down payment less than 20 percent requires you to pay for monthly private mortgage insurance (PMI) until you reach 20 percent equity paid over time.

Pre-approval

Many homebuyers seek a pre-approval letter prior to house shopping and entering into a loan agreement. A pre-approval letter shows you are a serious buyer and the sale is likely to go through.

To obtain a pre-approval letter, you’ll need to submit the following relevant documents:

• ID (driver’s license or passport and social security number)
• Employment verification (employer’s contact info)
• Income verification (pay stubs, W-2 forms, tax returns)
• Assets (bank statements for checking and saving, documentation of investments, retirement accounts)
• Liabilities (outstanding debts like mortgage, car, student loans)
• Residential history (current real estate holdings, rental history)
• Other documents (Gift letter if you have a family member contributing to down payment)

Since a pre-approval letter is not a legally binding document or an official loan agreement, you do not need to finance your home through the lender that provides your letter. If you think you can get a better loan elsewhere, it’s recommended you keep lender shopping.

Interest rates

When picking a home loan company, it is important to consider the loan rates offered. Some companies list sample interest rates estimates online, making them easily accessible, but other companies require potential customers to inquire over the phone or in person to receive sample rates. All lenders need personal identifying information from prospective lenders to determine the most accurate interest rate quote.

Rates can change from daily and even hourly, so keep in mind that even a company's most accurate estimate is not guaranteed until your rate is locked in.

Loan types

There are a number of different loans that you may qualify for, including the following:

• Conventional loans — fixed-rate mortgages
• Adjustable rate mortgages (ARMs)
• FHA loans
• USDA loans
• VA loans
• Jumbo loans
• Interest-only loan

Your loan officer can help you identify which loan type works best for you and your unique situation. Additionally, it is important to understand which home loan companies offer the specific loan option that you are looking for so that you can move forward without any hiccups.

Customer service

Many lenders work exclusively online. If having a brick and mortar branch location is important to you, identify local lenders and go from there.

Because home loans are often difficult and complex, effective communication between the company and the customer is essential. When choosing a home loan company, you want to make sure that communication is going to work to your advantage so you won't be confused about the details of your home loan.

Customer reviews will give you important insights. Looking through company profiles, reading reviews, and contacting customer service will help you, as a potential customer, determine if the company's customer service meets your needs.