Interest Only Mortgage News » Mortgage Interest Rates

Current mortgage rates

mortgagenews — Thu, 28 Feb 2008 11:15:19 +0000

Current mortgage rates are based on a variety of factors. We will explore those factors and find out how you can manipulate the home buying experience to ensure that you get the best current mortgage rates available.

Creditworthiness

One factor that your current mortgage rate will be based upon is your creditworthiness. Creditworthiness covers more than just your credit score. Creditworthiness includes other signs of responsibility, like what kind of job you have, how long you have been in your current profession, how stable your employer is, and the amount of money you earn.

The current mortgage rate that lenders offer you will be lower if you have a high credit score, if you work for an established, reputable employer, and if you earn enough money to comfortably pay not only your mortgage payment, but your homeowner’s insurance and property taxes, as well as all your other living expenses.

Equity

Another factor that will play into the current mortgage rate you are offered on a home is how much equity you have in the home. Equity is the amount of value you have in your home over and above the debt against the house. If your house is valued at $100,000, and your home loan balance is $60,000, you have $40,000 of equity, or 40% equity in your home. When you sell your house, you will have $40,000 to put as a down payment on your new house.

Mortgage lenders love equity. The more of her own money that a buyer invests in a new home, the more likely it is that she will make her mortgage payments on time and protect her investment by paying for property taxes and insurance and maintaining the property.

Home Value

The value of the home you want to buy is another factor that will affect the current mortgage rate your lender offers you. That is because the government subsidizes home loans for homes priced under a certain price limit, and if the home you want to buy falls under that limit, you may be eligible for one of those low-interest government loans.

Length Of The Loan

Do you need a 30 year mortgage, or can you pay off your loan in 15 years? If you sign up for a shorter-term loan, you will have a higher monthly payment, but your overall current mortgage rate will be lower.

Adjustability Of The Rate

Whether you get a fixed rate mortgage or an adjustable rate mortgage is the final factor that affects your current mortgage rate on your loan. Fixed rates may be a little higher, but the rate is guaranteed to stay the same over the life of the loan.

Post from: Interest Only Mortgage

Current mortgage rates

Understanding The Fear Of Mortgage Interest Rates

mortgagenews — Tue, 05 Feb 2008 00:15:09 +0000

With all of the fuss that has been talked about over the past year with the mortgage rates and how everyone is ending up in foreclosure, many people have been fearful of buying a home. But the fact of the matter is, the percentage of actual homeowners in the country who are fine and those who are unable to keep up with their mortgage interest rates, is pretty shocking. By the way the news media talks, you would assume every neighbor you have is facing foreclosure. But, the fact is that most people are all right either because they can afford the mortgage interest rates they signed for or that they were smart enough to get a fixed rate.

Most people who are first time home buyers get suckered into signing for an arm loan which simply means that their mortgage interest rates can change every six months or every year after their initial two or three years in the home. A lot of people do not prepare for the interest rate change as they either forget about it all together or figure it can’t be too bad. But sadly for some, there are loans whose mortgage interest rates have gone up several percentages which means several hundreds of dollars a month in increases.

How To Prevent Problems

The best thing to do is to stop the problem before it can actually happen. If you have not yet signed for your loan, talk about getting a fixed rate mortgage. The mortgage interest rates with these might be slightly higher then what they can offer you in the beginning of an adjustable rate mortgage but it will save you money and heartache down the road. Do not let the fact that you would be signing for a one and a half percent more then the arm, because within two years, your interest rate will still be the same and with the arm loan, it could have raised five percent or even more.

The thought process that you must keep going is about long-term stability instead of the instant feeling of reward. If you jump the gun too soon with mortgage interest rates, you will surely be paying for it in the long run. Take your time before agreeing on any sort of loan and make sure you think about all of the problems that could come your way in the future. While your current financial status supports these mortgage interest rates, will it support them if you end up in different work or someone needs surgery? Just take your time and think about all of your options and you will be fine.

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Understanding The Fear Of Mortgage Interest Rates