No Obligation and transparency 24/7. Instantly compare live rates and costs from our network of lenders across the country. Real-time accurate rates and closing costs for a variety of loan programs custom to your specific situation.
When someone is interested in buying a home, there are a number of factors that people need to consider. Some of these include the budget, the size of the home, and the mortgage interest rates.
In this post, we discuss the 7 factors which determine mortgage interest rates in the State of Washington. As most prospective buyers in WA State are aware, many markets in WA State have relatively high median home values. This means that even slight differences in mortgage interest rates can have a big impact on a buyer’s overall financial obligation.
One of the most important factors that a lender is going to consider is your credit score. A credit score is a reflection of your risk to the lender. The higher the credit score, the more likely the loan is going to be repaid, in the eyes of the lender.
If your credit score is too low, the lender might not make an offer at all. In order to reduce the interest on someone’s mortgage, it is important to correct any inaccuracies on the credit report ahead of time. This will make you more competitive when applying for a mortgage.
Another factor that plays a role in determining mortgage interest rates in WA State is the size of your down payment. As a general rule, the greater your down payment, the higher the chance you’ll receive a lower rate.
In most cases, lenders will want to see at least some type of down payment, although zero down payment loans do happen. If you don’t put down at least 20% on a home, private mortgage insurance is required.
Your interest rates depend in part on the state you’re looking to buy in. So, for WA State buyers, you’ll receive a rate which reflects the fact that you’re seeking to buy in WA State as opposed to California or Nevada. When you apply for a mortgage loan, you’ll input multiple pieces of data related to the location of your desired property. You’ll input the state, city, county, and so forth. The lender will use this information in the determination of your interest rate.
Another factor that contributes to your mortgage interest rate in Washington State is the loan term. Mortgage loans can be paid according to different repayment schedules. For instance, there are 30-year loans, 20-year loans, 15-year loans, and so forth.
As a general rule, the shorter the term of your loan, the lower your interest rate will be. However, even though shorter terms carry lower interest rates, they also carry higher monthly payments because the loan is paid off quicker. This is the tradeoff of receiving the lower rate.
There are several different types of mortgage loans, such as VA loans, FHA loans, conventional loans, and so forth. Your interest rate can vary depending on which type of loan you apply for. Some of these loans typically carry lower interest rates than others.
For instance, VA loans typically have lower rates. Prospective borrowers need to check to see the eligibility requirements for each of these loans and determine which loan they should apply for.
Related: Mortgage Loan Program Infographic
The lender’s biggest concern is making sure the loan is repaid. In order to make mortgage payments on time, you need to have a steady income stream.
In order to predict this, the lender will review your employment history. The longer you’ve been employed, and the fewer gaps in your employment history, the lower the interest rate on the mortgage may be.
Some of the factors involved in a mortgage rate are outside of the borrower’s control. Mortgage rates are also impacted by the current financial market.
Like the stock market itself, mortgage rates are going to rise and fall with the real estate market. It’s important for everyone to think about the current financial market when applying for a mortgage.
These factors will play a role in the mortgage rate someone is going to be offered. Everyone should think about the interest rate on a mortgage when looking for a home. As mentioned, interest rates may be especially important for buyers in WA State because so many local markets in WA have high median home prices. Higher interest rates can translate into unmanageable financial obligations. Take the steps to minimize your rate and reduce your monthly payment.
Talk about your personal financial situation with your trusted home finance professional. They are a valuable and experienced resource that can answer all of your questions regarding the best fit for your mortgage.
Rates are affected by credit scores, loan types, lender policies, and local housing demand.
Higher credit scores usually qualify for lower rates, while lower scores may lead to higher rates.
Yes, a larger down payment reduces the lender’s risk and can lead to better rates.
They’re generally in line with national averages but can fluctuate based on local economic conditions.
Different loan types — like FHA, VA, conventional, and jumbo loans — all have different rate structures based on risk and backing.
Yes, stable employment and income help lenders assess risk and may improve your rate offer.
Yes, most lenders offer rate locks to protect you from market fluctuations during the loan process.
ARMs are available and may offer lower initial rates, but they carry risk if rates rise later.
Improve your credit score, save for a larger down payment, and consider locking in rates during dips.
If you’re looking to buy a home in Washington, we can help. Sammamish Mortgage has been in business since 1992 and has been assisting home buyers in Colorado, Idaho, Washington, Oregon, and California. If you are looking for mortgage financing, we are here for you. Feel free to contact us with any questions or get an instant rate quote.
Whether you’re buying a home or ready to refinance, our professionals can help.
{hours_open} - {hours_closed} Pacific
No Obligation and transparency 24/7. Instantly compare live rates and costs from our network of lenders across the country. Real-time accurate rates and closing costs for a variety of loan programs custom to your specific situation.