Compare The Best Mortgage Rates in East Brady, PA
Compare East Brady, PA Mortgage Rates
Whether someone intends to buy a new home or refinance the mortgage on their current home for a better deal, it's crucial that they get the best possible mortgage rates. That's where MyRatePlan can make a world of difference in pulling up the best mortgage rates in East Brady, PA. We have all the info and tools a home buyer needs to research and compare mortgage rates, which will help them get the lowest interest rate and avoid paying any more than necessary for a home.
How Borrowers Can Get the Best Home Loan Rates in East Brady, PA
For the typical homebuyer in East Brady, PA, a mortgage is going to be a necessity to fund their home purchase. Even the most inexpensive homes on the market still tend to cost $50,000 or more, which is more than most people have on hand in their bank accounts, making it extremely difficult to pay for a home with cash. That's why a home loan is such an important part of the purchasing process. A small interest rate difference can make a massive difference over a loan with a term of 20 to 30 years. Real estate agents are often able to recommend their own preferred lenders that they know from past deals, but it's best for homebuyers to take these recommendations with a grain of salt. The real estate agent wants the deal done as soon as possible, but the homebuyer wants the home loan with the lowest interest rate, and those goals don't always align. Patience is a virtue for homebuyers looking for the right mortgage lender, and they should always check out rates online first for a full comparison. The MyRatePlan home loan interest rate tool is great for locating the lowest mortgage rates throughout East Brady, PA. After the homebuyer finds the lowest rate, it's all a matter of making sure they have a credit score high enough to qualify.
Different Mortgage Types Available in East Brady, PA
For home loans, there are many products available to appeal to a variety of buyer types. The two most common types of mortgages on the market are fixed-rate mortgages and variable mortgages, which work very differently and suit different types of borrowers.
A fixed-rate mortgage in East Brady, PA will be fixed at one interest rate during the entire term of the loan, hence the name. The borrower will be making a monthly payment for the same amount every month, whether they have a 10-year mortgage or a 30-year mortgage. This keeps things consistent and gives the borrower some peace of mind, because they don't need to worry about any terms on their home loan suddenly changing.
True to their names, adjustable-rate mortgage loans (ARMS) in East Brady, PA have changing interest rates that can increase or decrease depending on the market. The most common type of ARM is known as a hybrid ARM, and the reason is that it actually combines features from fixed-rate mortgages and ARMs. It starts like a fixed-rate mortgage with a set interest rate for a certain number of years, and then it switches over to an ARM. An example would be a 7/1 ARM. The seven indicates the number of years that the mortgage has a fixed rate, and the one indicates how often, in years, the interest rate adjusts after that. Therefore, a 7/1 ARM means a home loan with a fixed interest rate for the first seven years and an interest rate that adjusts every one year from that point forward.
FHA Mortgage Loans In East Brady, PA
It will be up to you whether you choose to go with a fixed-rate or adjustable-rate mortgage loan. However, there are other choices to choose from as well. You might get to choose whether or not you want to use a conventional type of loan or government-insured type of loan such as a VA or FHA loan. Conventional home loans from private lenders are ones that are not insured or even guaranteed by the government in any such way. This is the biggest difference between the three types of government-backed home loans such as FHA loans, USDA loans and VA loans.
The Department of Housing and Urban Development, or HUD, manages the Federal Housing Administration, or FHA. In East Brady, PA, FHA loans can be available for many types of home loan borrowers, even if this is not your first time buying a home. Through these loans, the government will ensure your lender against any losses that could be a result from the borrower defaulting on the loan. One advantage of this type of loan is that the program will allow you to make a low down payment on the purchase price starting at 3.5 percent. A disadvantage of this program is that you will have to pay for mortgage insurance, which will increase the amount you'll have to pay each month.
Refinancing a Home Loan in East Brady, PA
Although the term is technically refinancing, how this process really works is the borrower applies for a brand-new mortgage, which they use to pay the previous mortgage. The point of refinancing is that the new mortgage has a better interest rate than the old one, and this means that the borrower saves money by paying less interest on the remainder of their loan. The borrower should note any extra costs that come with the new mortgage, as there could be fees and closing costs involved. It's important that they do the math to make sure they're actually saving money when those fees are taken into account. However, if the borrower is making the switch from an ARM to a fixed-rate home loan, that's always a good move because they're not at the mercy of what happens with interest rates, which tend to increase, not decrease. When refinancing a mortgage, it's important for the borrower to get their credit score over 700 and minimize their debt-to-income ratio to look as low risk as possible to potential mortgage lenders and secure the lowest possible interest rate. The good news is that even a borrower who doesn't meet all the highest standards could still find a mortgage in East Brady, PA with a low interest rate.