Broward Mortgage Rates

Broward County Mortgage Rates

When purchasing a home, mortgage rates can either make or break you. It is important to do your rate research and understand what mortgage rates are going to do while you are home shopping. Although mortgage rates are typically set individually by each bank, they are still loosely tied to a few other trends in the financial marketplace. The first indicator is the 10-year Treasury bill. This is considered the gold standard for predicting mortgage rates. If the T-bill rate goes up, mortgage rates are very soon to follow. You can check rate trends for the Treasury bill on the Treasury’s website or in the financial section of your local newspaper. The other indicator of mortgage rates is the Mortgage Back Securities (MBS) bonds. Although this is not as reliable as the T-bill, they can be used together to save you money. If MBS bonds recently went up but the Treasury bill has not, this means that T-bill and mortgage rates will not be far behind in the rate spike. If you can beat the rise in rates, then you can save valuable money on your monthly mortgage payment. Another factor that can inexplicably raise rates is the inflation rate. A large inflation rate indicates financial instability. When banks are loaning money in unstable times, they consider the loan a higher risk and therefore raise the interest rate. If you do your rate homework, you can save yourself a lot of valuable money.

Refinancing in Broward County

If you need money out of your home and think that home equity loan is the only way to get it, think again. When interest rates are low, it may be smarter to do a cash-out refinance. This means that you refinance your home and take out the equity that you have built up in the home. Often rates on a first mortgage are lower than those of a home equity loan (second mortgage), so it can save you money in the long run. Some banks even offer no-closing-cost refinances if you are taking additional funds out of your home. Be sure to call around to local banks in your area to find the ones that offer free refinancing. This can end up being a much better deal for you if you stay under 80% loan-to-value. This means that you must leave 20% of your home’s value in the home. This ensures that you do not have to pay private mortgage insurance which can end up costing more than taking the home equity loan in the first place.

FHA Mortgage Loans in Broward County

The FHA has some really nice programs for first-time home buyers that have had a shaky credit history or even past bankruptcies. Although these are excellent programs, the rates are typically a quarter percent or more higher than the rates of conventional mortgages through banks or other lending institutions. Given the high-risk borrowers and the insurance that the FHA must pay to the financial institution, the loan costs more to finance. The lender then passes this cost on to the consumer. Although this seems like a disadvantage to the program, most of the borrowers would not have otherwise qualified for a mortgage at all. A spike in interest rate is a small price to pay to own the home of your dreams.