Buying a new home? Learn about mortgage rates!
Getting a mortgage is a lot like choosing a pet, or a significant other - you're going to be together for a long time, so you want to make sure that you get it right! This can mean a bit more than just finding the lowest mortgage interest rates, so before you commit to a mortgage, make sure that you're getting the best deal and find out what are the current mortgage interest rates.
Types of Mortgages
Basically, mortgages come in two flavors - adjustable rate, and fixed rate. A fixed rate mortgage is one that has the same rate of interest throughout the entire period of the loan. The good news is that you'll always know exactly what you're paying, but the bad news is that if mortgage interest rates should happen to go down, you'll still be locked into the higher rate.
An adjustable rate mortgage usually begins with a low short term rate. Once the initial period is over, however, the rate fluctuates according to current market conditions. If rates are currently low, of course, you'll pay less, but if the rates go up, so does your monthly payment.
Right now, 30-year mortgages are the most common, but you can also consider terms of 20, 15 or 10 years. Over the course of a shorter term, your monthly payments will be higher, but you'll end up paying less mortgage interest rates.
Current mortgage interest rates can vary from lender to lender, and are very much subject to economic factors, market conditions, and of course, to your own financial background. Generally speaking, people who have high credit scores and steady jobs will get the best home mortgage rates. However, if you have a blemished credit report, your home mortgage rate is likely to be higher.
Already a Homeowner?
If you currently own your home in Orange County, California, but you're looking to move into a larger home or perhaps a better neighborhood, it's likely that you'll be able to qualify for a mortgage. However, you could end up paying a higher mortgage interest rate. Right now, millions of homeowners are locked in at low home mortgage rates. By the time you sell your current home in Orange County, California, home mortgage rates could go up considerably. You might even end up paying more for a home that really isn't all that different from your current one.
This is what's known as "mortgage rate lock", and it's estimated that it could impact a lot of people by the middle of next year when experts predict that fixed mortgage rates could increase by more than 5%.
What this means is that you could find yourself unable to sell your existing home, and you could end up carrying two mortgages. Obviously, this isn't the outcome you're looking for. So what do you do?
If you're thinking about buying a new home in Orange County, California right now, while the mortgage interest rates are low, make sure that you've taken a cold, hard look at your situation, both as it is now and as it's likely to become. Keep in mind that current mortgage interest rates are low, but are unlikely to go on forever, and ask yourself if you'll be able to afford a higher home mortgage rate in the not-too-distant future, and if buying a new home is really something that's going to make you happy over the long term.
If you do decide to buy a new home (or possibly refinance your existing home) in Orange County, California, then it would be advisable to know about current mortgage interest rates and lock in your mortgage for as many years as possible. Reputable lenders will always be willing to advise you on the best course of action for home mortgage rates.