Mortgage rates tend to move in concert with the yield on 10-year government treasuries. As the yield on that instrument goes higher, mortgage rates will also go higher. When you buy a bond, you are guaranteed by the full faith of the US government to get repaid. When you buy a mortgage backed security, there is an additional risk premium because you are ultimately putting your money behind millions of individual homeowners with no guarantee that every loan will be paid on time or that borrowers will not pay off their loans early. To make up for this additional risk, mortgage rates will be about 2 percentage points higher than the yield on the 10-year treasury bond.

While buyers cannot control the macro economy, there are things that buyers can do to make sure they are in the best position to get competitive rates despite the macro-economic factors.

Improve Your Credit Score

It's no secret that borrowers with stronger credit scores typically qualify for lower interest rates because they have a demonstrated history of managing credit responsibly.

If your credit score is below 740, work with a lender to identify ways to improve it, both before purchasing a home and over the long term.

Save for a Larger Down Payment

A larger down payment can improve your loan terms.

Putting 20% down can help you avoid certain pricing adjustments, eliminate private mortgage insurance (PMI), and reduce your overall monthly housing costs.

Shop Around

One of the simplest ways to save money is to compare offers from multiple lenders.

Research from the Consumer Financial Protection Bureau shows that buyers who shop around for a mortgage loan can often secure lower interest rates than those who accept the first offer they receive.*

That's one of the reasons Beazer Homes offers Mortgage Choice, a program designed to help buyers compare offers from multiple participating lenders so they can make a more informed financing decision.

The Bottom Line

While none of us can control the overall economy or where mortgage rates are headed next, we can control how prepared we are when it's time to buy a home.

Improving your credit score, saving for a larger down payment, and comparing multiple lenders can all help you secure a more competitive mortgage rate and save money over the life of your loan.

Have a mortgage question you'd like Mike to answer? Stay tuned for future editions of Ask Mortgage Mike as we continue answering common questions about the home financing process.

Beazer Homes does not act as a mortgage lender or mortgage broker. Buyers should consult with a mortgage broker or lender of their choice regarding mortgage loans and mortgage loan qualification, including available interest rates and other questions about the home financing process.