When you are shopping around for houses, you might find yourself wondering why it seems like all the mortgage interest rates are so high. Mortgage rates are actually determined by personal financial factors and differ from person to person. If you’re ready to buy a house, here are the steps you can take to make sure you qualify for the lowest mortgage insurance rates.

Have a High Credit Score.

The biggest factor that determines your rates is actually your credit score. The reason why is because credit score is a direct predictor of whether or not you will be able to make your payments on time. Therefore, the higher your credit score is, the less of a risk you present to your lender, and the lower interest rate you will have. If you aren’t in a rush to buy a home and have a less-than-ideal credit score, try building up your credit by making purchases and regularly paying them off.

Put Forth a 20% Down Payment.

If you can afford to put forth a 20% down payment, it’s always a good idea to do so. The reason why is similar to that of the credit score mentioned above: the more money you put down, the less you have to borrow from the lender; therefore, the less of a risk you are to the lender. Your rates will decrease exponentially if you can put down a 20% down payment, and they will drop even further if you can afford to put more down.

Have Steady Income.

Having a steady income is an indicator that you will be able to make your mortgage payments regularly and on time. Therefore, it’s best to wait until you have two years of paystubs or more to show your lender. It’s okay if you’re self-employed, just as long as your income has been consistent and you’re able to prove that to your lender.