I find often with my Charleston clients their biggest fear is the financial logistics of home buying, not even the home budget itself. Navigating approvals and understanding mortgage rates is often foreign to potential buyers of all ages. In an industry where the rates and economic impacts change daily it’s no wonder this is a common road block for many looking to purchase a home in the Lowcountry.
By definition a mortgage is “the rate of interest charged by a mortgage lender.”
I often get asked what variables will affect your mortgage rate. While I have amazing preferred lenders that will walk you through every step here is a great quick list of factors which can affect your mortgage rate from ConsumerFinance.gov:
- Credit score
- Home location
- Home price and loan amount
- Down payment
- Loan term
- Interest rate type
- Loan type
And to delve a little deeper Investopedia.com breaks down the key takeaways of the concept of mortgage rates:
– An interest rate is the cost of borrowing money.
– Interest provides a certain compensation for bearing risk.
– Interest rate levels are a factor of the supply and demand of credit.
– The interest rate for each different type of loan depends on the credit risk, time, tax considerations, and convertibility of the particular loan.
I always encourage my home buyers to educated themselves and never be afraid to ask questions. Curious to learn more? Forbes breaks down the basics here. If you’re looking to buy a new home in Charleston and surrounding areas I would love to help. From home searching to all your financial concerns lets make house hunting fun, together.
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