To secure a cheaper mortgage loan, prioritize improving your credit score, shop extensively for lenders, and strategize around down payment amounts. A higher credit score (ideally 740+) lowers interest rates, as lenders view you as less risky. Comparing offers from multiple lenders using tools like the CFPB’s mortgage calculator ensures you access the lowest rates, with a 2023 study showing borrowers save $50,000+ over 30 years by shopping. Offering a 20% down payment eliminates private mortgage insurance (PMI), reducing monthly costs by up to 1.5% annually.

The effectiveness of these strategies stems from credit scoring models, which directly tie interest rates to risk metrics. For example, a 100-point credit score increase can lower rates by 0.25%, saving $50-$100 monthly on a $300,000 loan (Federal Reserve, 2022). Mortgage rate shopping is critical because lenders’ rates vary by 0.5-1.5% (Consumer Financial Protection Bureau, 2023). A 20% down payment avoids PMI, which costs $50-$100 monthly on average (Bankrate, 2023). Data from the National Association of Realtors (NAR) confirms that 30% of borrowers with 20% down save $200+ monthly versus those with 10% down. Combining these tactics maximizes savings, with a 2023 study estimating a $300,000 loan could save $120,000 over 30 years through optimal credit, shopping, and down payment strategies.