Understanding Mortgage Rates

A mortgage rate reflects how much you’ll pay to take out the loan. It’s the interest you’ll owe annually which will be a percentage of your loan’s total balance.

There are both fixed-rate and adjustable-rate mortgage loan options. With fixed rates, your interest is consistent throughout the entire course of the loan. If you have an adjustable-rate loan, your interest rate can fluctuate after a certain amount of time, sending your monthly payment up or down.

What mortgage rates are determined by?

Economic Factors include:

Strength of the economy
Inflation rates
Employment
Consumer spending
Housing construction and other market conditions
Stock and bond markets
10-year Treasury yields
Federal Reserve policies

Personal Factors include:

Credit score
Credit history
Down payment size
Loan-to-Value ratio
Loan size, type, and term
Debt-to-Income ratio
Location of the property

Generally, to get the lowest interest rate, you should have a:

Credit score of 760 or above
Down payment of 20% or more
Low Loan-to-Value ratio
Low Debt-to-Income ratio

CHECK CURRENT MORTGAGE RATES