What Will The Interest Rate On My Mortgage Be?

By
Real Estate Agent with Coldwell Banker Residential Brokerage
https://activerain.com/droplet/4NZJ

Mortgage Interest Rates What will the interest rate on my mortgage be?

 

This is consistently one of the very first questions I'm asked by home buyers, followed by what will my payment be on a home costing "XYZ." And my answer is usually "I don't know what your rate or payment will be, as there are multiple factors that go into determining what the final rate will be for a specific borrower. And while I've known for a long time that there are multiple factors in the equation, what I didn't realize until recently is that there are actually some 26 criteria that can affect an individual's mortgage rate. These include:

  1. Loan amount

  2. Loan to value ratio (LTV)

  3. Combined loan to value ratio (CLTV)

  4. Credit score

  5. Credit history

  6. Escrow preference

  7. Closing date

  8. Loan type

  9. Property type

  10. Occupancy type

  11. Residency

  12. Available assets

  13. Asset seasoning

  14. Co-borrowers

  15. Debt ratio

  16. Housing ratio

  17. Home improvements needed

  18. Employment type

  19. Employment history

  20. Documentation type

  21. Points

  22. Term of loan

  23. Relocation

  24. Seller contributions

  25. Gifts

  26. Cash-out

 

Obviously, not all of these impact each borrower all of the time. BUT it's really critical for home buyers/borrowers to make sure their lender really understands their unique financial situation and needs. Otherwise, you'll be quoted rates that might never see the light of day once you actually make a loan application. Be sure your lender is asking you the right questions so you can ensure that the rate quote you get is as close to reality as possible. Don't ever rely on a quote over the phone or the internet. The Home Loan Learning Center is a great resource to start getting educated about how all this works.

 

And if you are thinking about starting to look for a home, don't wait to get pre-qualified. Start putting your documentation together now. Not only will this speed up the loan-pre-approval process, but it will allow you to make a much stronger offer to a seller (very important these days in cities like Charlotte where we are now officially out of a buyer's market). Here's a list of just some of the documents you should start gathering putting in your "morgage file:"

  1. A list of previous addresses for the past two years, and if you were renting, the name(s), address(es), and phone number(s) of your landlord(s).

  2. W-2 forms for the last two years. If you are self-employed or your income is based on commission, you will need your tax returns for the last two years complete with schedules and a year-to-date profit and loss statement.

  3. Paycheck stub for the last 30 days.

  4. Account number(s), balance(s) and monthly payment(s) for all outstanding creditors (including credit cards, car loans, student loans, etc.).

  5. Bank statements for the last two months, and their most recent asset account statements (i.e., stocks, 401K, etc)


 Credit HistoryAnd don't forget to at least annually check your credit scores--you can do this for free. I've had any number of buyer clients in recent months who hadn't checked their scores in years and found out that their scores were way lower than they thought (which increased their borrowing rate) because of incorrect items on their credit histories. And even if you challenge incorrect information it can take 30 or more days to resolve and get your score back to where it needs to be. 

 

Carolinas Realty Partners would be happy to put you in touch with some of Charlotte's top mortgage lenders if you are looking to finance a home or just get an idea of what you could qualify for before you start your home search. Getting prepared in advance will ensure a smooth transaction with a minimum of surprises. And I won't need to be saying "I don't know" when you ask what will the interest rate on my mortgage be!

 

Carolinas Realty Partners will be happy to help you get started in getting pre-approved for a mortgage. We have great relationships with some of Charlotte's top mortgage lenders. Let us help you... and then I won't need to say "I don't know" when you ask me what will my mortgage interest rate be and how much will my monthly payment be!

Posted by

 

SEARCH ALL CHARLOTTE METRO AREA HOMES HERE

 

 Nina Hollander, RE/MAX Broker, Realtor

 

 

 

 

 

 

Nina Hollander

Broker, Realtor, MBA, GRI, ABR, SRES, CDPE, SFR, SPS, CMRS
Carolinas Realty Partners with Coldwell Banker Residential Brokerage
Direct: 704-779-0813
Website: www.GreatHomesInCharlotte.com
Blog: News You Can Use From Charlotte/Ballantyne/Waxhaw/Fort Mill
Search For All Charlotte Area Homes: www.GreatHomesInCharlotte.com 

2007 - 2018 Charlotte Magazine 5-Star Customer Satisfaction Award Winner

 

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Disclaimer:  Nothing in this blog article is to be construed as legal advice, tax advice, or financial advice.  For legal advice see an attorney.   For tax advice or financial advice see a tax attorney, certified public accountant, or other qualified professional.

 

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Re-Blogged 8 times:

Re-Blogged By Re-Blogged At
  1. Ginger Harper 01/13/2013 10:38 PM
  2. Paul McFadden 01/14/2013 06:42 AM
  3. Derek McClintock 01/15/2013 01:56 PM
  4. Gabe Sanders 01/20/2013 06:55 PM
  5. Terry Kraemer 01/22/2013 09:21 AM
  6. Mike Jones 03/08/2013 03:13 PM
  7. Cara Marcelle Mancuso 03/10/2013 01:17 AM
  8. Winston Heverly 04/17/2013 12:02 AM
Topic:
Lending / Financial
Location:
North Carolina
Tags:
mortgage interest rates
carolinas realty partners
what affects mortgage interest rates
26 criteria impact mortgage interest

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Rainmaker
2,970,381
Nina Hollander
Coldwell Banker Residential Brokerage - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

Rob Spinoza! That's a fabulous come-back and I'm certainly going to use it from here on in!

Jan 13, 2013 11:31 PM #13
Rainmaker
1,085,962
Greg Nino
RE/MAX Compass, formerly RE/MAX WHP - Houston, TX
Houston, Texas

Nice stuff. I honestly didn't know there were 26! And what is the 25th one?

Jan 14, 2013 02:09 AM #14
Rainmaker
1,217,262
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Nina:  Great post ... and as a Mortgage Lender myself, I thank you for helping to get the word out!  And it seems like that list is growing each and every day too.  It's not hard to see why today's Borrowers sometimes feel like they're being grilled when they have to answer so many questions.  As you point out, being prepared ahead of time for pre-qualification and mortgage application is the best route to assuring that you'll be successful.  I sure hope many many read your post and follow your advice ...

Gene

Jan 14, 2013 04:32 AM #15
Rainer
128,498
John Fauth
Coldwell Banker King Thompson - Grove City, OH
Turning your dreams into an address!

Great list Nina! This is great to show a perspective buyer. So many get excited about looking before they get approved for a loan. This will help them put the horse back in front of the cart.

Jan 14, 2013 05:02 AM #16
Ambassador
659,208
Paul McFadden
Paratex - Seattle, WA
Pest Control, Seattle, WA.

Nina: Good for you! You just made my job so much easier. I love it when a realtor takes the time to explain to a potential homebuyer about how financing is determined. It's something a radio or TV ad can never do. Thanks for your great post!

Jan 14, 2013 06:38 AM #17
Rainmaker
2,701,008
John Pusa
Berkshire Hathaway Home Services Crest - Glendale, CA
Your All Time Realtor With Exceptional Service

Nina - It appears that many factors involve on a mortgage interest rate. Thanks for the list of information about what will the interest rate on my mortgage.

Jan 14, 2013 09:26 AM #18
Rainer
144,923
Theresa Akin
CORPUS CHRISTI REALTY GROUP - Corpus Christi, TX

Nina, This is a great and informative post. If I may add another item I inform my potential buyers before they go to speak with a lender. If there are any other deductions such as garnishment of wages to explain them. Also if theyhad a bad period such as an decrease in pay. I had a buyer who had trouble explaining a deduction on his paycheck. It was a garnishment for a student loan. He had a decrease in pay and wasn't paying on his student loan at one point. So now the garnishmnt. They got the loan. He sent a letter of explanation and was caught up on all payments but it was touch and go. The loan officer pre-qualified him. The loan processor said the guy's credit was marginal and it took some talking to to get this loan to go through. They were iffy on the garnishment. He acted like he was doing me a favor. I told him if it was so marginal why did they push it?

Moral of the story also have a letter of explanation for any other deductions on the paycheck.

Jan 14, 2013 10:34 PM #19
Ambassador
664,746
John DL Arendsen
CREST BACKYARD HOMES, ON THE LEVEL GENERAL & FACTORY BUILT HOME CONTRACTOR, TAG REAL ESTATE SALES & INVESTMENTS - Leucadia, CA
Crest Backyard Homes "ADU" dealer & Contractor

And the list jus keep growing and growing and growing.

Jan 14, 2013 10:40 PM #20
Rainer
277,746
Ron Aguilar
Continental Mortgage - Saint George, UT
Mortgage & Real Estate Advisor since 1995

25 is gifts

Jan 14, 2013 11:11 PM #21
Rainmaker
261,951
Robby Leviton
Keller Williams Realty - Kirkland, WA
Knowles Team

I pretty much always reccomend to people that they need to speak with the mortgage expert right up front to see how much house they really want to buy. It doesn't matter how much they qualify for. Many qualify for a lot more then they really want to have a payment for so that is why I tell them to get with an expert Mortgage Consultant, figure out the price range they like, get the preapproval letter and then lets have some fun shopping.

Jan 14, 2013 11:23 PM #22
Rainer
361,832
Jana Holmstrup
Jana Holmstrup - CEO - Kings Mortgage Services, Inc. - Visalia, CA

Oh, let me count the ways...  Thank you for validating the difficulty pricing loans these days!  I've never sat down to make an itemized list before - and now I won't have to :)  Thank you!

Jan 15, 2013 12:18 AM #23
Rainmaker
518,492
Harrison K. Long
HomeSmart, Evergreen Realty - Irvine, CA
REALTOR , GRI, Broker associate, Attorney

Nina ... Yours is a very good post on the 26 factors that can determine a person's interest rate when getting a mortgage or purchase money loan.  Thanks.

Jan 15, 2013 02:04 AM #24
Rainmaker
529,969
Jon Quist
REALTY EXECUTIVES TUCSON ELITE - Tucson, AZ
Tucson's BUYERS ONLY Realtor since 1996

Good post. Lots of reasons. That's why I always refer my buyers to a mortgage professional. One with LOTS of experience, and is also very calm and a soothing influence with buyers. 

Jan 15, 2013 07:48 AM #25
Rainmaker
368,638
Travis "the SOLD man" Parker; Associate Broker
Team Linda Simmons, Enterprise, AL 36330 - Enterprise, AL
email: Travis@theSOLDman.me / cell: 334-494-7846

WOW - 26 items.....whehhh, glad I'M not buying a house now!

Jan 15, 2013 07:54 AM #26
Rainer
470,908
Kimo Jarrett
WikiWiki Realty - Huntington Beach, CA
Pro Lifestyle Solutions

It depends, dosen't it, if a buyer has already received a loan approval letter. The letter should include what the rate, term and payments will be, so plan ahead and take action to buy today, right? 

Jan 15, 2013 02:38 PM #27
Rainer
133,027
Rob Renk
Center Street Lending - McKinney, TX
AE | Fast Fix/Flip Loans for Residential Investors

Interest rates vary greatly and you have   a  long list of reasons that can affect the rate.  They are making this business a government bureaucracy very quickly if it hasn't reached that status yet.

Jan 18, 2013 08:42 PM #28
Rainer
53,303
Terry Kraemer
Exceed Realty - Houston, TX
Houston Realtor

This is a great article.  Next time I get that question, I will just send them this post!

 

Jan 22, 2013 09:13 AM #29
Rainmaker
1,158,213
Jane Peters
Home Jane Realty - Los Angeles, CA
Los Angeles real estate concierge services

Excellent post, Nina.  Hopefully, this is a discussion buyers have during their first call with a lender, at least a good one.

Mar 10, 2013 10:37 AM #30
Rainer
144,923
Theresa Akin
CORPUS CHRISTI REALTY GROUP - Corpus Christi, TX

This is great Nina. When I speak with potential buyers is a list of infordmation I've comprised over the years that a lender may want from them, so why not get that to them so they can get their own information together to speed things up. One of my past buyers got the list of information together and they even had information from "other" deductions explained from their paychecks. They checked their own credit history to  make sure there were no discrepancies. They didn't purchase a large home but it was their first home and they wanted to get it right. They had enough of a down payment for their budget and moved in within 6 weeks. their only glitch was the loan officer didn't contact them when he said he would. They contacted another one and closed with that one. AFter two weeks the first loan officer contacted them and was unhappy they moved on. They were tired of waiting for his reply. They listened to their realtor and loan officer (#2 but #1 in their book )

Feb 21, 2016 04:07 AM #31
Rainmaker
2,970,381
Nina Hollander
Coldwell Banker Residential Brokerage - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

Theresa Akin ~ good morning, Theresa... don't you just love clients like that? I know, I do! They make our lives so much easier.

Feb 21, 2016 09:27 PM #32
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