Today's Rates In Montana
July 08 2020
July 08 2020
July 08 2020
Montana is known for wide open spaces and the Big Sky from which it gets its nickname. But fortunately, you don't have to go a long way when shopping for a home loan to find the best Montana mortgage rates. Thanks to online lending, you can check out lenders, compare rates and even apply for Montana home loans from the comfort of your own home!
Shopping around to find the best mortgage rate is important – small differences can add up to big bucks over the life of a loan. A difference as small as one-eighth of a percentage point can mean thousands of dollars in additional interest costs over a 30-year loan – and an additional bump in your monthly payments as well. So spending a little time to compare offers from half a dozen or so different lenders is well worth it.
Online lending makes that easy and convenient to do. You can quickly obtain and compare offers for rates and different types of loans right from home. It also expands your options, giving you more lenders to choose from. You're not just limited to lenders or brokers with an office nearby – you can get a home loan from practically any Montana mortgage lender! You can work with lenders outside Montana as well, as long as they're licensed to make loans within the state.
With online lending, Montana borrowers don't have to make special trips to a lender's office to get information, discuss their options with a loan officer, apply for a home loan or submit paperwork – practically the whole process can be done online.
How to start? You can check current Montana mortgage rates, above, to see what are the average rates borrowers are paying in your state. Then check listings for individual lenders to see what rates they're offering. Finally, you want to request rate quotes to see what sort of rates various lenders will offer you personally for the loan you're seeking. You can do that by contacting individual lenders, or by using the rate quote form at the top of this page to request personalized rate quotes from multiple lenders at once.
Comparing Montana home loan rates
When shopping for home loans, it's important to remember that the rate a lender is advertising may not be the rate you get. Mortgage rate pricing varies from borrower to borrower, depending on a variety of factors. Your credit score, down payment, loan amount, debt-to-income ratio, the type of property, where the property is, the fees a lender charges and more can all have an effect on the rate you're offered.
That's why it's important to get personalized rate quotes from lenders when shopping for a mortgage. The rates a lender advertises may draw your interest, but you need to get a quote to find out what rate they'll offer you, based on the type of loan you're seeking and things the type of home, your credit score, down payment and loan amount.
You don't need to have exact numbers at this point – an approximation will do, as long as you're giving the same info to each lender you're seeking quotes from. You do want to request all your quotes on the same day, preferably within an hour or two of each other, because market rates can change from day to day and sometimes even several times a day.
When you're ready to choose a lender and supply, you'll provide detailed information and the lender will provide you with the exact rate they'll offer and which you can lock in at that point. It's not a bad idea to do this with 2-3 lenders to get a final quote of the exact rate they'll offer, then choose the best one and finalize your application with that one.
Watch the fees
When shopping for Montana home loans, don't get too fixated on mortgage rates alone. The fees that are charged along with a loan can have a big impact on how much you pay.
Closing costs on a home loan can vary from 2-6 percent of the loan amount, so a mortgage with a low rate and high fees may not be quite as good a deal as it appears. You want to take into account both the rate and fees. This is where a mortgage calculator comes in handy, as you can add up the total costs of different loan offers over the duration of the loan and see how they compare. See the links at the bottom of this page for mortgage and financial calculators to help you.
A quick way to compare the total costs of various loan offers is to compare the APR on various loans rather than the mortgage rates. The APR, or annual percentage rate, is a way of expressing the total annual cost of a loan as a percentage, taking into account both the rate and fees. The higher the number, the costlier the loan. This works particularly well with fixed-rate loans. By law, the APR must be included with any offers of an interest rate on a loan, including advertisements.
Types of Montana home loans
So what's the right type of home loan for you? Here are some of your options:
- Conforming loans, those backed by Fannie Mae and Freddie Mac, are the most common type of U.S. mortgage for home purchases and refinancing. These are often the first choice for borrowers with good to excellent credit. Borrowers with scores as low as 620 are still eligible, but will pay higher rates.
- FHA loans are a common choice for first-time homebuyers and borrowers with weaker credit. They allow lower credit scores than conforming loans do and may have better rates for borrowers with lower scores as well, while allowing down payments as low as 3.5 percent.
- VA loans allow no-down payment mortgages for eligible military veterans and active duty service members, though you'll save on fees if you can make a down payment of 5-10 percent.
Fees and other requirements can vary among these loan types, so be sure to compare all the costs before making your choice. Don't just automatically choose a VA loan if you're a veteran or an FHA loan if you're buying your first home – explore all your options. Follow the links at the top and bottom of this page for more information on specific loan types.
Within those broad types, you have several other options as well:
- Fixed-rate mortgages –These have mortgage rates that never change over the duration of the loan, offering stability and predictable costs. They're most commonly offered in 30-year and 15-year durations, but many lenders offer other lengths as well.
- Adjustable-rate mortgages – Know by their acronym ARM, these loans have rates that vary over time to reflect market conditions. They're less predictable than fixed-rates but can offer lower rates as well, especially initially. For home purchases and refinancing, these often have a fixed rate for the first few years then readjust every year thereafter. These loans have names like 5/1, 7/1 or 10/1 ARMs, indicating how many years the rate is fixed and then how often it adjusts after that. They're often a good choice for someone who expects to move after a few years, so they don't need to lock in a long-term rate
- Refinance mortgages – Generally speaking, you can do a Montana mortgage refinance with the same types of loans you would use to buy a home. The big difference is that your home equity replaces the down payment made with a purchase. Lenders usually like to see at least 10-20 percent home equity on a refinance but there are a number of options for refinancing with little to no home equity, provided you've stayed current on your mortgage payments.