What is the rate?
I want the lowest rate possible!
My buyers are constantly asking me what the current interest rates are for purchasing Maui Real Estate. There are many factors that affect a buyer's interest rate. One of my most reliable lenders wrote this blog for my newsletter. Feel free to contact Craig (info at bottom) for more info. Hope you find this information helpful.
Interest rates are extremely low right now. They are in the high 4's to the low 5's depending on the borrower's qualifications AND the property type. Will they go lower? They might. There is some talk about the Government buying the Mortgage Backed Securities (MBS) and thus being able to reduce the interest rate as low as 4.5%. However, that is not set in stone as of today, and not everyone will qualify.
Mortgage interest rates vary throughout the day. Shopping for the best rate is almost impossible on your own. Mortgage interest rates are based on the MBS; not the 10-year Treasury note as commonly believed. Often interest rates are advertised with "points" which is a cost to the borrower (sometimes the seller) to buy down the interest rate.
There are several variables that go into determining an interest rate. The following are just a few:
- What is the property type? (Single Family Residence, Condo, Condotel, Land, etc.)
- How much money down?
- What is the occupancy? (Primary Residence, Second Home, Investment)
- What is your credit score?
- How many mortgages do you currently have?
- What is your current income?
The biggest change in the last several months is that most borrowers need to provide income and asset documentation (paystubs, tax returns, bank statements, etc). Mortgage insurance is also becoming a necessity for some people with less than 20% equity.
A good rule of thumb for calculating rates for investment properties is usually 1-2% higher than the national average on a primary residence or a second home.
There is still money to loan for qualified borrowers'. The programs include:
- 100% financing
- Government - FHA and VA
- Construction
- Vacant Land
- Foreign Nationals
- Condotel
In summary, find a mortgage broker you trust that has the ability to shop on your behalf. A mortgage broker who has access to numerous lenders both local and national (often over 100 lenders) has the ability to take your individual scenario and locate a lender whose guidelines are applicable as well as assuring you get the best rate.
Written by: Craig Haueisen of Windsor Capital Mortgage Corporation
Feel free to contact Craig directly - 808.298.7549 or email him @ craig@focusmaui.com.
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