September 19, 2021

MP Now News

Mortgage News

August 22, 2021| Historic Lows

Today’s mortgage and refinancing rates are generally low, and the gap between fixed and floating rates has been closing in recent days. It could be a good day to secure a historically low interest rate.

Mortgage rates shouldn’t rise dramatically until employment and inflation in the US continue to improve. So if you’re not ready to buy or refinance just yet, you have a little extra time to take advantage of it low interest rates.

This is how mortgage rates work

A mortgage rate is the fee a lender charges on borrowing, expressed as a percentage. For example, you get a $ 300,000 mortgage at a 2.5% interest rate.

Mortgage rates can be either fixed or adjustable. With a fixed-rate mortgage, your interest rate stays the same over the life of your loan. A variable rate mortgage will lock your interest rate for the first few years or so and then change it regularly. With a 7/1 ARM, your rate would stay constant for the first seven years and then shift annually.

The longer your mortgage term, the higher your interest rate. For example, you pay more for a 30 year mortgage as a 15 year mortgage. However, longer terms come with lower monthly payments as you spread out the repayment process.

Today’s mortgage and refinancing rates

The current mortgage rates

Conventional Tariffs from Money.com; government-sponsored rates from RedVentures.

Today’s refinancing rates

Conventional Tariffs from Money.com; government-sponsored rates from RedVentures.

How to Get the Best Mortgage Rate

Here are some steps you can take to get the best possible mortgage rate:

  • Get a fixed rate mortgage. You can ask your specific lender about their fixed rate versus floating rate. But in general, fixed rates start lower than adjustable rates. Interest rates are also at all-time lows, so you would set a low rate instead of risking an increase later with an ARM.
  • Look at your finances. The stronger your financial situation, the lower your mortgage rate should be. Look for opportunities to your credit-worthiness or lower yours Debt-Income Ratio, If necessary. Save for a higher one deposit also helps.
  • Choose the right lender. Each lender charges different mortgage rates. Pick the right one for your financial situation will help you get a good price.

How to choose a mortgage lender

First, consider what type of mortgage you would like. The best mortgage lender will be different for a year FHA mortgage than for a VA mortgage.

A lender should be relatively affordable. You shouldn’t need a very high credit score or down payment to get a loan. You also want it to offer good pricing and reasonable fees.

Once you are ready to start buying homes, Apply for pre-approval with your top three or four decisions. A pre-approval letter states that the lender wants to loan you up to a certain amount at a certain interest rate. If you get pre-approved, your mortgage rate will be on hold for 60 to 90 days. With a few pre-approval letters in hand, you can compare any lender’s offerings.

When you apply for pre-approval, a lender will do the following: hard credit request. A series of tough inquiries about your report can damage your credit rating – unless the aim is to buy the best price.

If you limit your purchase to a month, credit bureaus will understand that you should be looking for a home and not pulling every single request against you.