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Mortgage Rate

Mortgage Rate FAQs

What are mortgage rates?
Mortgage rates are the term used to refer the interest rate an individual or organization will pay for borrowing funds from a loan institution for purchasing a home or home equity loan.  Mortgage rates come in a fixed or variable form.  In a fixed mortgage rate scenario, the interest rates on the loan remain the same during the course of the mortgage loan.  Variable mortgage rates are subject to change during the lifetime of the loan.

What factors influence mortgage rates? 
Both variable and fixed mortgage rates are influenced by current economic conditions.  Along with these economic factors, the rates are also influenced by an indexes linked to a government security.  Besides the economic factors, the type of loan program one selects as well as the credit history of an individual heavily influences the mortgage rate.

What are the benefits of getting a better mortgage rate?
The obvious benefit of a lower mortgage rate is the lower mortgage payment owed over time.  Being able to manipulate the mortgage rate through negotiations is possible.  Another course of action is simply shopping around to various companies.  A final factor a potential homeowner should consider is the benefits of taking on a large mortgage payment.  For example, in many instances the mortgage rate for a fifteen-year mortgage is significantly lower than the average thirty-year mortgage rate.

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