Current state of mortgage rates
Due to the economic impact of COVID-19, the federal government has cut interest rates. These cuts affect various types of mortgages differently, and have also driven a spike in demand, putting pressure on lenders and their staff. As a result, at times, you may see different or higher rates, or no rates. So, how does this impact your ability to find a low rate mortgage?
What are today’s mortgage rates?
As of Friday, May 15, 2020, according to some recent surveys of the nation’s largest mortgage lenders, the benchmark 30-year fixed mortgage rate is 3.560% with an APR of 3.780%. The average 15-year fixed mortgage rate is 3.000% with an APR of 3.230%. The 5/1 adjustable-rate mortgage (ARM) rate is 3.310% with an APR of 3.880%.
Finding The Best Rate
The first step in finding a low rate mortgage is to decide what type of mortgage best suits your goals and budget. Typically, 15-year mortgages have lower rates but larger monthly payments than the more popular 30-year mortgage. Similarly, adjustable rate mortgages usually have lower rates to begin with, but the downside is that you’re not locked into that rate, so it can rise.
Once you’ve determined what type of loan works for you, then you should shop around. With so many lenders to choose from, borrowers should comparison shop to get the best rate. Be sure to look at the APR, not just the interest rate. The APR is the total cost of the loan (which includes the interest rate and other fees). Some lenders might have the same interest rate but different APRs, which means you’ll be charged more in fees.
At Real Estate Funding Solutions we are here to help you with your search for a low rate mortgage. Give us a call at 1-855-913-8637 today to let us help you get started!