Six Ways to Get a Better Mortgage Rate

Unless you have pristine credit, it's no longer a sure thing that you'll snag a decent interest rate on a mortgage -- or even qualify at all, for that matter.

But before you sign another year's lease on your rental, take note: There are steps you can take to help make yourself better mortgage material in a matter of months, says Gibran Nicholas, CEO of the CMPS Institute, a training and certifying group for mortgage brokers in Ann Arbor, Mich.

Generally, lenders want to see borrowers with credit scores of at least 660 and debt levels at less than 40% of income.

Pay Off Certain Debts First

Raising your credit score isn't just a matter of chipping away at debt and paying bills on time. You can strategize: If you pay off certain debts before others, you may increase your score faster.

Focus on paying off credit cards with the highest balance relative to credit limit, rather than those with the highest balance in absolute terms, Nicholas says.

For example, if you pay down a $7,000 balance on a card with a $10,000 limit, that will bump up your credit score far more than if you pay down a $10,000 balance on a card with a $20,000 limit, he says.

Shuffle Your Debt

If you don't have the extra cash to pay down debt, consider transferring balances between credit cards so that each card has a lower ratio of debt to credit limit, says Janet Guilbault, a mortgage specialist in San Francisco, Calif.