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So you Want to know about interest rates. The truth of the matter is, It Depends on You! Various factors make up the interest rate for a particular product and borrower. Listed below are some of those factors: 1. Credit: your credit history, but specifically your middle fico score 2. Liquid Assets: your available cash on hand 3. Liability: monthly loan payments 4. Down Payment if any 5. Income: are you able to document your income through W-2's or Tax Returns or will it be a Stated or No Ratio loan 6. Occupany: do you intend to live at the home or will it be an investment property 7. Other Real Estate: How many homes do you currently own and have financed 8. Any bankruptcy, foreclosure, judgement, or collection accounts 9. Term: Do you want a 30 year fixed, 5 year hybrid arm, 1 month MTA, FHA, etc. 10. Structure: Do you want to have 2 liens (i.e. 80/15/5), 1 loan with No Mortgage Insurance, No Interest payment, etc. These are some of the questions that are taken into consideration when inquiring into interest rates. Tip on shopping for interest rates. Mortgage interest rates fluctuate with the market, therefore the rate quoted is only good for that day, and in most cases the lender must already have your application on file, and you are ready lock in your rate. Nevertheless, it is important to do the following:
- Shop on the Same Day
- Ask to be quoted on the same product type from the various lenders (i.e. 30yr fixed, 5yr arm, etc.) - How many points, origination and discount. (1 point = 1% of loan amount) So on a $200,000 loan, this is $2,000. - How long is the quote good for…i.e.. 30, 45, 60 days - Ask for the APR (annual percentage rate) - Get Good Faith Estimate in writing
For more information, below are links to a few trusted source, if you want to get an idea of what the market is doing and get a benchmark for what the best rates are going for today. But if you want to know what rates are available to your specific situation, please don't hesitate to call me. Thank you, Sela E. Finau |
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