This advice for home buyers, it's not all about the rate!!! I have had the same conversation three times today with first time home buyers. In each conversation, I was asked the same question, "which program has the lowest interest rate?" In today's mortgage market, it isn't all about the rate. It is about which program is the right fit for that buyer.
"What's the rate?" It is one of those questions that doesn't have a simple answer. There are too many variables that will impact the interest rate available for the client. Let's take a look at the areas that will impact the interest rate:
- Credit score - an adjustment will be made to your interest rate - the lower your score, the higher the rate
- Type of occupancy - Is it for a primary residence, second home or investment property?
- Down Payment - the requirements for each will also depend on the program.
- Loan size - an adjustment may be made depending on the program.
- Closing Date - Are you closing in 30 days? If you are looking at an extended lock, the rate may also be slightly higher.
Clearly from the list you can see it is not a one size fits all interest rate. My recommendation is to select the right financing program for you!
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