How to get the best rate? Prove you are low risk

Many borrowers are finding that the record-low mortgage rates advertised recently are out of reach.

So how can borrowers snag these best rates – which for the 30-year fixed-rate mortgage has been under 4 percent recently?

Basically, they need to prove to lenders they are less risk: Lenders offer the best rates to those who they perceive as low-risk borrowers.

Here are ways for consumers to show lenders that they are low-risk borrowers, according to a recent article at The New York Times:

Credit score: According to one mortgage broker, ideal borrowers nowadays have a FICO score of 740 or higher to qualify for the best pricing.

Property types: Buyers of a duplex, four-unit building, or condo may have a rate premium added. Also, lenders will charge borrowers more if they plan to rent out the property rather than live there.

Down payment: Borrowers who put down at least 25 percent will most likely attract the best pricing, lenders say. Lenders offer different breaks on rates if equity is higher, so ask what is available.