Mortgage Rates

Mortgage rates are a tricky thing
that most of us don’t quite under
stand. There are factors that a
ffect mortgage rates that we have
no control over – things like the
Federal Reserve, inflation,
economic growth, and so on.
But there are other factors that
we do have a lot of control over,
and these can affect your
mortgage rate as well

• Amount of loan: Typically, the
  more money you want to borrow,
  the higher your interest rate will
  be.
• Length of loan: If you agree to a longer period of repayment on a loan, your rates will be higher. Shorter repayment periods will usually have lower interest rates. Keep in mind though – even though you may have a lower rate with a shorter loan, your monthly payments may turn out to be higher. But the lender will ultimately keep more of your money with a longer repayment period, because you will pay less per month but for a much longer time period.

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• Credit Score and History: The better your credit score and history are, the less of a risk you are considered, and lenders will offer you a lower mortgage rate.
• Income Level: The more income you earn in excess of your credit obligations, the lower your interest rate will be.

Closing Costs: If you can’t afford to pay all of the closing costs on the loan, then you will most likely be offered a higher mortgage rate. The more of the closing costs you can afford to pay upfront, the better. Otherwise, the closing costs will be rolled up into your loan and not only will your mortgage rate increase, you will begin paying interest on the closing costs as well.