3 Factors That Influence Mortgage Loan Rates

Ever wonder what factors influence how much interest you wll pay on your mortgage loan?  Three major factors influence interest rates when it comes to your mortgage loan– Credit Scores, the Federal Reserve, and The Loan Type.
Let’s take a look at each one:

interest11. Credit Scores have a huge impact on your mortgage loan rate.  With a high credit score (between 760-850), homebuyers will benefit from best interest rates.  If your credit score has dipped below 620, you would be considered a “subprime” borrower, and will probably pay a higher interest rate than someone with fico scores.  Atlantic Coast Mortgage Group does have loan programs for those with credit scores as low as 500.  We also help borrowers rescore their credit to obtain the best interest rate possible.

2.  The Federal Reserve and other government agencies are partially responsible for determining the current interest rate.  When the Federal Reserve purchases longterm securities or debts to spur the economy, interest rates usually fall.  Right now, we are seeing some of the lowest interest rates, and they currently stand at about 4.5%.  This is a great time to purchase or refinance to lock in that low rate.

3.  The Type of Loan that you choose will also affect the interest rate.  Adjustable Rate Mortgages or ARM’s have fluctuating interest rates, whereas Fixed Mortgages usually have one low long-term fixed rate over the entire life of the loan.  We can help determine which type of loan is best for your purchase or refinance.

If you have questions about interest rates, or if you are interested in purchasing or refinancing a home to lock in a lower rate, give Wayne Page of Atlantic Coast Mortgage Group a call today at (843) 444-LOAN (5626) or fill out an application on our secure website at www.444loan.net to get the process started.