AZ Lending Experts | Arizona Mortgage Rates AZ Lending Experts

Arizona Mortgage Rates AZ Lending Experts

Arizona Mortgage Rates AZ Lending Experts
 

When looking for a home mortgage, there are many options a buyer might be interest in.  One might desires an interest only loan, or an adjustable rate mortgage, but the question that everyone will ask, is “what will the mortgage interest rate be on my home loan”.  Mortgage interest rates are typically set by the following factors:

1.      Movement of the 10-year Treasury bond yield

Although there are many factors that affect the interest rate, it is commonly thought that the 10-year Treasury bond yield is the best indicator in determining whether mortgage interest rates will rise of fall. 

Most mortgages are the conventional 30-year fixed mortgage, but the average mortgage is paid off or refinanced within 10 years, so the 10-year bond is a great determiner of interest rate changes.

Typically, when bond yields go up, interest rates go up.  When bond yields go down, interest rates also go down.

2.      Economic activity impacts mortgage rates

Mortgage rates can also be impacted by economic activity.  Job reports, the consumer price index, gross domestic product, home sales, consumer confidence and other data can move mortgage interest rates.

3.      Supply and Demand

If loan origination skyrocket, the supply of mortgage-backed securities may rise beyond the associated demand and prices can drop to become attractive to buyers.  This means the yield will rise, and mortgage rates will also rise.

Timing is important.  Although mortgage interest rates can rise very quickly, they usually go back down in a slow, calculated manner to protect lenders from rapid market shifts.  Mortgage rates are still at an all-time low, but indicators could be in place where mortgage rates will go up, and could take years before they return back to the present rates.  Although anything can happen, the forecast for future movement of mortgage interest rates is that mortgage rates are projected to go up.  It is forecasted that in 2015, the mortgage interest rates will not go up by a lot, and that in 2016, although not a lot of movement will take place, the interest rates will continue to go up.  If you are looking for a home mortgage and concerned that the Arizona mortgage rates will rise, the time to close on your mortgage is now.  An expert on home mortgages and Arizona mortgage rates is AZ Lending Experts.  They are a licensed Arizona mortgage broker who are experts in reading Arizona mortgage rates, and determining the best options for your home mortgage.  If you see that mortgage rates are rising in Arizona, see  Arizona Mortgage Rates AZ Lending Experts to lock in your rates.

There are seven primary determining factors for your mortgage interest rate.  Like most people, you want to get the lowest interest rate available in Arizona.  Although the interest rate is ultimately determined by the Fed, typically determined by the movement of the 10-year Treasury bond yield, having knowledge on the factors that determine the interest rate that a lending institution will offer you on a home mortgage can allow you to plan and set yourself up for the best interest rates for your home loan.  The main determining factors are:

1.      Your Credit Score

Obviously, your credit score plays a key factor in determining the interest rate that the lending institution will give you on your home mortgage.  You should get a copy of your credit report from all 3 credit reporting agencies to make sure any inaccurate information that could lower your credit score is removed.

2.      Home location

Many lenders have slightly different rates depending on where you live.  Sometimes a home in a rural area may have slightly different rates offered by the lender.

3.      Down payment

In general, the more you put down on your home, the lower your interest rate will be.  Lenders see a lower risk when you have more stake in the property.

4.      Loan term

A shorter loan, such as a 15 year loan instead of a typical 30 year loan, can often result in lower interest rates.

5.      Interest rate type

Interest rates basically come in two forms:  (1) fixed interest rates, and (2) adjustable interest rates.  You can usually get a lower initial interest rate with an adjustable rate loan, but that rate might increase significantly later in the life of the loan.

6.      Home price and loan amount

Obviously the home price and the amount of your loan amount can be a determining factor.  If you have a jumbo loan, or a very small loan amount, the rates can be slightly higher.

7.      Loan type

When looking for a home loan, your mortgage broker should provide options to you which include VA loans, FHA loans and conventional loans.  Rates can vary significantly depending of the loan type that you choose.

Two basic types of amortized loans are the fixed rate mortgage (FRM) and adjustable-rate mortgages, commonly called ARM’s.  Fixed rate mortgages are the norm, but floating rate mortgages are also relatively common. Combinations of fixed and floating rate mortgages are also common, whereby a mortgage loan will have a fixed rate for some period, for example the first five years, and vary after the end of that period. For home buyers looking for the best  Arizona Mortgage Rates AZ Lending Experts is a smart choice.

In a fixed rate mortgage, the interest rate stays fixed for the term of the loan. In case of an annuity repayment plan, the periodic payment remains the same throughout the loan. In case of linear payback, the periodic payment will gradually decrease.

In an adjustable rate mortgage, the interest rate is generally fixed for a period of time, after which it will periodically, usually annually or monthly, adjust up or down based on a specific market index. Adjustable rates transfer part of the interest rate risk from the lender to the borrower, and thus are widely used where fixed rate funding is difficult to obtain or exorbitantly expensive. Since the risk is transferred to the borrower, the initial interest rate may be, for example, 0.5% to 2% lower than the average 30-year fixed rate; the size of the price differential will be related to debt market conditions.

Don’t forget that the most detailed information about AZ Lending Experts you can always get on the official web-site, in the company’s office or by calling by phone↓

Website: www.azlendingexperts.com

Address: 4500 S. Lakeshore Dr., Suite 650, Tempe

Phone:4806493825

Other means of contact: info@azlendingexperts.com, 

                                        rsimon@azlendingexperts.com